10KSB

UNITED STATES SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-KSB

þ Annual report under Section 13 or 15(d) of the Securities Exchange Act of 1934 for the fiscal year ended September 30, 2006.

o Transition report under Section 13 or 15(d) of the Exchange Act.

Commission file number: 333-123473

SIOUXLAND ETHANOL, LLC

(Name of small business issuer in its charter)

Nebraska
(State or other jurisdiction of
incorporation or organization) 22-3902184
(I.R.S. Employer Identification No.)

1501 Knox Boulevard
Jackson, NE 58743
(Address of principal executive offices)

(402) 632-2676
(Issuer’s telephone number)

Securities registered under Section 12(b) of the Exchange Act: None

Securities registered under Section 12(g) of the Exchange Act: None

Check whether the issuer is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. o Yes þ No

Check whether the issuer: (1) filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the past 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. þ Yes o No

Check if there is no disclosure of delinquent filers in response to Item 405 of Regulation S-B is not contained in this form, and no disclosure will be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-KSB or any amendment to this Form 10-KSB. þ

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). o Yes þ No

State issuer’s revenues for its most recent fiscal year. None

As of December 22, 2006, the aggregate market value of the membership units held by non-affiliates (computed by reference to the most recent offering price of such membership units) was $32,980,000.

As of December 22, 2006, there were 3,789 membership units outstanding.

DOCUMENTS INCORPORATED BY REFERENCE None.

Transitional Small Business Disclosure Format (Check one): o Yes þ No

TABLE OF CONTENTS

PART I
Item 1.	DESCRIPTION OF BUSINESS	1
Item 2.	DESCRIPTION OF PROPERTY	8
Item 3.	LEGAL PROCEEDINGS	8
Item 4.	SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS	8
PART II
Item 5.	MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES	9
Item 6.	MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION	10
Item 7.	FINANCIAL STATEMENTS	14
Item 8.	CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE	28
Item 8A.	CONTROLS AND PROCEDURES	28
Item 8B.	OTHER INFORMATION	28
PART III
Item 9.	DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE ACT	28
Item 10.	EXECUTIVE COMPENSATION	30
Item 11.	SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS	32
Item 12.	CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS	33
Item 13.	EXHIBITS	34
Item 14.	PRINCIPAL ACCOUNTANT FEES AND SERVICES	37
SIGNATURES		38
Standard Form of Agreement and General Conditions
Equipment and Services Agreement
Redevelopment Contract
Guaranty Agreement
Subordinate Deed of Trust, Assignment of Leases and Rents and Security Agreement
Debt Subordination Agreement
Certification
Certification
Section 1350 Certification
Section 1350 Certification

Information Regarding Forward Looking Statements

          This report contains forward-looking statements that involve future events, our future performance and our expected future operations and actions. In some cases you can identify forward-looking statements by the use of words such as “may,” “should,” “anticipate,” “believe,” “expect,” “plan,” “future,” “intend,” “could,” “estimate,” “predict,” “hope,” “potential,” “continue,” or the negative of these terms or other similar expressions. These forward-looking statements are only our predictions and involve numerous assumptions, risks and uncertainties. Our actual results or actions may differ materially from these forward-looking statements for many reasons, including the following factors:

• Changes in our business strategy, capital improvements or development plans;

• Construction delays and technical difficulties in constructing the plant;

• Changes in the environmental regulations that apply to our plant site and operations;

• Changes in general economic conditions or the occurrence of certain events causing an economic impact in the agriculture, oil or automobile industries;

• Changes in the availability and price of natural gas and corn

• Changes in the markets for ethanol and distillers grains, including the effects of possible overproduction of ethanol or distillers grain;

• Changes in federal and/or state laws (including the elimination of any federal and/or state ethanol tax incentives);

• Changes and advances in ethanol production technology; and

• Competition from alternative fuel additives.

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          Our actual results or actions could and likely will differ materially from those anticipated in the forward-looking statements for many reasons, including the reasons described in this report. We are not under any duty to update the forward-looking statements contained in this report. We cannot guarantee future results, levels of activity, performance or achievements. We caution you not to put undue reliance on any forward-looking statements, which speak only as of the date of this report. You should read this report and the documents that we reference in this report and have filed as exhibits completely and with the understanding that our actual future results may be materially different from what we currently expect. We qualify all of our forward-looking statements by these cautionary statements.

          All references to “we,” “us,” “our” and the “company” in this report refer to Siouxland Ethanol, LLC.

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PART I

Item 1. DESCRIPTION OF BUSINESS.

          Siouxland Ethanol, LLC is a development-stage Nebraska limited liability company that was formed on August 12, 2004 for the purpose of constructing and operating a dry mill corn-based ethanol plant near Jackson, Nebraska. We are in the process of building a plant with an anticipated capacity to produce 50 million gallons of denatured fuel grade ethanol and 160,000 tons of dried distillers’ grains per year. This plant is under construction and is expected to be completed in April 2007.

          On January 9, 2006, we entered into a design-build agreement with Fagen, Inc. (“Fagen”) for the construction of the initial 50 million gallon per year dry grind ethanol production facility. Under the terms of the design-build agreement, we will pay Fagen $56,619,000, subject to any mutually agreed-upon adjustments and subject to a credit for any amounts previously paid to Fagen Engineering, LLC for engineering performed pursuant to a Phase I and Phase II Engineering Services Agreement for the plant. On January 20, 2006, we entered into a license agreement with ICM, Inc. for limited use of ICM, Inc.’s proprietary technology and information to assist us in operating, maintaining, and repairing our ethanol plant. We are not obligated to pay any fee to ICM, Inc. for use of the proprietary information and technology because our payment to Fagen for the construction of the plant under the design-build agreement is inclusive of these costs. We expect that the total cost to complete the construction of the initial plant and the associated infrastructure, land acquisition and development, and various start-up costs will be approximately $88 million by the time the plant commences operations.

          In January 2006, we announced our intent to double the production capacity of our plant from an annual ethanol production capacity of 50 million gallons to 100 million gallons as quickly as that may be feasible. On December 11, 2006, we entered into a binding letter of intent with Fagen under which Fagen will provide us with certain services necessary for us to develop a detailed description of a 50 million gallon per year expansion to our ethanol production facility which is currently under construction in Jackson, Nebraska and to establish a price for which Fagen would provide design, engineering, procurement of equipment and construction services for such an expansion. The purpose of the description is to develop pro forma cost data to determine if the expansion can be financed. Under the letter of intent, Fagen has an exclusive right to provide design, engineering, procurement of equipment and construction services for the proposed expansion. Construction costs of the proposed 50 million gallon expansion are expected to approximate the total costs associated with bringing the first 50 million gallon plant into production. If we determine that the expansion of the plant is economically feasible, we will enter into a Lump Sum Design-Build contract with Fagen for the design, engineering, procurement of equipment and construction services for the expansion. Certain of the terms of such a Design-Build contract are described in the letter of intent. The letter of intent has a term ending December 31, 2007 unless the basic size and design of the expansion has been determined and we have raised at least 10% of the necessary equity to finance the project. The term may be extended by mutual agreement of the parties.

Principal Products

          Our principal product will be ethanol to be used as a motor fuel. In addition to replacing part of the volume of gasoline used for motor fuel, ethanol acts as a high-quality octane enhancer and an oxygenate capable of reducing air pollution and improving automobile performance. Ethanol can also be used as a virtual replacement of gasoline in flexible fuel vehicles which can operate on fuels such as E85, which is a blend of 85% ethanol and 15% unleaded gasoline. In addition to ethanol, the distillers’ grain which will be produced by our plant as a co-product of ethanol production can be sold as high grade cattle feed. Currently, we do not intend to capture and market any carbon dioxide produced by our plant.

          Ethanol is produced by the fermentation of sugars found in grains and other biomass. While ethanol can be produced from a number of different types of grains as well as from agricultural waste products, we will produce ethanol primarily from corn. Corn produces large quantities of carbohydrates, which convert into sugars more easily than most other kinds of biomass.

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Markets and Distribution

          The principal end users of the ethanol produced at our plant will be refiners and blenders of gasoline. However, rather than market directly to these end users, we plan to market all of the ethanol produced at our plant through ethanol marketing agreements with one or more ethanol redistributors that have access to numerous markets and customers. By marketing our ethanol production in this manner, we will not need to develop a significant internal sales organization. On April 3, 2006, we entered into an Ethanol Marketing Agreement with Archer Daniels Midland Co. (“ADM”) for the marketing and sale of the ethanol we produce. Pursuant to this agreement, ADM will pool between 40 and 60 million gallons of our ethanol per year with ethanol it produces. If we produce more than 60 million gallons of ethanol in a year, we may sell the excess to a third party only with ADM’s prior written consent. Alternatively, if we do not produce the minimum amount of 40 million gallons of ethanol, ADM may purchase ethanol elsewhere to cover the shortfall and charge us for any resulting excess costs or expenses it incurs. Pursuant to the Ethanol Marketing Agreement, ADM will pay us the amount it receives from its customers, less expenses and a marketing fee, which is a percentage of the final average net ethanol selling price. The initial term of the Ethanol Marketing Agreement will run for two years from the date we begin production. After that, it will automatically renew for successive one-year terms unless terminated by either party upon six months written notice, by mutual agreement, or for cause.

          The principal end users of the dried distiller grain produced at our plant will be cattle feeding operations. On March 2, 2006, we entered into a Distiller’s Grains Marketing Agreement with Commodity Specialist Company (“CSC”) under which CSC will market all of the distiller’s dried grains with solubles (“DDGS”) we produce at our ethanol plant, except any that we may sell to a single potential customer located near the plant. Further, the agreement confers no opportunity or obligation for CSC to market any of the wet distiller’s grains (“WDG”) produced at our plant, which we intend to sell ourselves. We will receive a price equal to 98% of the amount CSC receives from its buyers, which shall be not be less than $1.50 per ton, less CSC’s freight costs. The agreement imposes quality standards on our DDGS. The term of the agreement is one year commencing with the start-up of our ethanol plant. After the one-year period, the agreement will continue until terminated by either party

          Currently, we do not intend to capture and market any carbon dioxide produced by our plant.

Ethanol Demand and Supply

          Currently, ethanol represents only up to 3% of the total annual gasoline supply in the United States. However, according to the Renewable Fuels Association, the national trade association for the U.S. ethanol industry, demand for fuel ethanol in the United States is growing and reached 4.0 billion gallons per year in 2005. The recent implementation of a Renewable Fuels Standard (“RFS”) contained in the Energy Policy Act of 2005, which was signed into law on August 8, 2005 (the “2005 Energy Act”), is expected to stimulate both the production and use of ethanol through the creation of a RFS which increases steadily from 4.0 billion gallons per year in 2006 to 7.5 billion gallons per year by 2012. The implementation of the Volumetric Ethanol Excise Tax Credit (“VEETC”) on January 1, 2005, is also expected to help expand the use of ethanol into higher concentration blends such as E85, E diesel and fuel cell markets. According to the Energy Information Administration, E85 consumption is projected to increase from a national total of 11 million gallons in 2003 to 47 million gallons in 2025. Ethanol can also be used as an aviation fuel and as a hydrogen source for fuel cells. According to the National Ethanol Vehicle Coalition, there are currently about 4.5 million flexible fuel vehicles capable of operating on E85 in the U.S. and nearly 1,000 retail stations supplying it. Automakers have announced plans to significantly expand the production of flexible fuel vehicles in the future, beginning in 2007.

          Ethanol is also a replacement for methyl tertiary-butyl ether (“MTBE”) which has been used as an oxygenate for gasoline. While the Energy Policy Act eliminated the Clean Air Act’s 2% oxygenate requirement for reformulated gasoline, the Clean Air Act still contains an oxygenated fuel requirement for areas classified as carbon monoxide non-attainment areas. These areas are required to establish an oxygenated fuels program for a period of no less than three months each winter. The minimum oxygenate requirement for gasoline sold in these areas is 2.7% by weight which is the equivalent of 7.7% ethanol by volume in a gasoline blend. Also, while the Energy Policy Act did not impose a national ban of MTBE, it did not include liability protection for manufacturers of MTBE. As a result, most refiners have elected to switch to ethanol rather than MTBE and an oxygenate for gasoline.

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          Although overall demand for ethanol as a motor fuel is expected to continue to increase, the market price of ethanol will be subject to a number of factors which may result in significant short-term fluctuations or long-term decreases in ethanol prices. In particular, the supply of ethanol available as a motor fuel additive is also expected to increase and it is possible that the available supply will grow faster than the demand for ethanol. As of January 2006, the Renewable Fuels Association estimated that 1.98 billion gallons per year of additional ethanol production capacity was under construction in the United States which would raise total domestic production capacity to 6.32 billion gallons per year.

Federal Ethanol Support Programs

          There are several federal programs designed to provide additional economic incentives for the production of fuel ethanol. The most recent ethanol supports are contained in the 2005 Energy Act which creates a 7.5 billion gallon RFS which requires refiners to use 4 billion gallons of renewable fuels in 2006, increasing to 7.5 billion gallons by 2012. A number of bills have been introduced in the U.S. Congress to double the RFS to 15 billion gallons per year, however, there can be no assurance that such legislation will be ultimately enacted. In addition to the recently-enacted federal renewable fuel standard, the federal government and various state governments have created incentive programs to encourage ethanol production and to enable ethanol-blended fuel to compete in domestic fuel markets with gasoline blended with MTBE. State incentive programs include production payments and income tax credits. Current federal tax supports for ethanol consist of the following:

• Volumetric Ethanol Excise Tax Credit. On January 1, 2005, the Volumetric Ethanol Excise Tax Credit (“VEETC”) went into effect. Prior to VEETC, the federal excise tax on 10% ethanol-blended gasoline was 13.2 cents per gallon compared to 18.4 cents per gallon on regular gasoline. Under VEETC, the lower federal excise tax on ethanol-blended gasoline was eliminated. In place of the lower excise tax, the VEETC created a new volumetric ethanol excise tax credit of $0.51 per gallon of ethanol. Gasoline distributors apply for this credit on the same tax form as before only it is a credit from government’s general revenue, not the highway trust fund. Based on volume, the VEETC is expected to allow greater refinery flexibility in blending ethanol since it makes the tax credit available on all ethanol blended with all gasoline, diesel and ethyl tertiary butyl ether (“ETBE”), including ethanol in E-85. The VEETC is scheduled to expire on December 31, 2010. A number of bills have been introduced in the Congress to extend ethanol tax credits, including some bills that would make the ethanol tax credits permanent. There can be no assurance, however, that such legislation will be enacted.

• Small Ethanol Producer Tax Credit. Small ethanol producers are allowed an income tax credit equal to 10 cents per gallon on up to 15 million gallons of ethanol production annually. The tax credit is capped at $1.5 million per year per producer. Historically, a small ethanol producer was one with the capacity to produce up to 30 million gallons per annum. Under the 2005 Energy Act, the size limitation on the production capacity for small ethanol producers was increased from 30 million to 60 million gallons per year. This credit is available through 2008 and will be available to us unless our production exceeds the 60 million gallons per year limit by that time.

• Other Tax Credits. The 2005 Energy Act created a new tax credit that permits taxpayers to claim a 30% credit (up to $30,000) for the cost of installing clean-fuel vehicle refueling equipment, such as an E85 fuel pump, to be used in a trade or business of the taxpayer or installed at the principal residence of the taxpayer. Under the provision, clean fuels are any fuel of which at least 85% of the volume consists of ethanol, natural gas, compressed natural gas, liquefied natural gas, liquefied petroleum gas, and hydrogen and any mixture of diesel fuel and biodiesel containing at least 20% biodiesel. The provision is effective for equipment placed in service after December 31, 2005, and before January 1, 2010.

• Tariffs on Imported Ethanol. Ethanol imported into the United States is generally subject to an ad valorem tariff of 2.5% of the product value. A secondary duty of 14.27 cents per liter or 54 cents per gallon is also imposed on ethanol imports. The secondary duty was created to offset the value of the ethanol tax credit taken by the petroleum industry when ethanol, both domestic and imported, is blended with gasoline. Some bilateral trade agreements like the U.S.-Israel Free Trade Agreement and the North American Free Trade Agreement, allow ethanol that is produced completely with feedstocks from countries that are parties to these agreements to enter the U.S. duty-free. Congress has also created unilateral trade preference programs, such as the Caribbean Basin Initiative and the Andean Trade Preference Act, that allow ethanol

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produced in those countries to enter the U.S. duty free. This means that ethanol producers in those countries avoid the secondary tariff as long as the ethanol is produced from within their own country.

          There can be no assurance that these tax incentives will positively affect the demand for ethanol or that the federal government will continue to provide such supports to the ethanol industry or continue them at their current levels. The elimination or reduction of any of these federal ethanol supports may reduce ethanol demand or reduce the margins available to us when we sell our ethanol production. Other types of federal supports, designed to stimulate the production of ethanol for non-grain feed stocks or tax credits for reductions of greenhouse gases, have been proposed and may be enacted in the future. However, there can be no assurance that any additional federal supports or incentives for ethanol production will be enacted.

Competition

          The fuel ethanol industry is characterized by a large number of small participants all producing a commodity product that cannot be differentiated from the product of any other market participant. There are currently over 100 producers of fuel ethanol in the United States with capacities ranging from less than 500,000 gallons per year to over 1.0 billion gallons per year. The largest ethanol producers include Archer Daniels Midland, VeraSun Energy Corporation, Cargill, Inc., New Energy Corp., Abengoa Bioenergy Corp. and Aventine Renewable Energy, Inc. The average producer has a capacity of less than 50 million gallons per year. We may also compete with foreign ethanol producers, many of which have lower production costs than domestic ethanol producers. Many of these foreign producers, particularly those located in the Caribbean basin and Central America, may import ethanol into the United States at low tariff rates or free of tariffs. Additional ethanol producers are expected to continue to enter the market if the demand for ethanol continues to increase. We plan to compete with other ethanol producers primarily on the basis of price by being an efficient and low cost producer. However, there is no assurance that we will be able to produce ethanol at a lower overall price than competitors or that new technologies or methods of ethanol production will not be developed that allow competitors to produce ethanol less expensively than us.

          Ethanol also competes with other fuels and fuel additives. In particular, as a fuel additive and gasoline oxygenate, ethanol competes with alternative chemicals such as MTBE and ETBE. These alternative gasoline oxygenates are generally less expensive than ethanol and, in the case of ETBE, may be transported by pipeline and held in storage tanks due to its low affinity for water.

          Alternative fuels and alternative ethanol production methods are continually under development. The major oil companies have significantly greater resources than we have to develop alternative products and to influence legislation and public perception of ethanol. New ethanol products or methods of ethanol production developed by larger and better-financed competitors could provide them competitive advantages and harm our business.

          We also face competition in connection with the sale of distillers’ grains. The principal end users of the dried distiller grain produced at our plant will be cattle feeding operations. We will compete with other ethanol plants and other sources of distillers’ grains as well as with other types of cattle feed. As domestic ethanol production increases, the amount of distillers’ grains entering the market is also expected to increase and may reach the point of market saturation.

Corn Feedstock

          We anticipate that our plant will need approximately 18.5 million bushels of grain per year for our dry milling process. In general, we expect to obtain corn primarily from farmers in the six county area around the site of the plant and expect corn production in this area to be adequate for our needs. We anticipate establishing ongoing business relationships with local farmers and grain elevators to acquire the corn needed for the project. However, we have no contracts, agreements or understandings with any grain producer in the area at this time. We will compete with other users of corn in the area including other producers of ethanol, livestock feeders and corn processing companies. The availability of corn, and the price at which we will be able to purchase corn, will depend on prevailing market conditions, which can be volatile. There can be no assurance that a corn shortage will not develop, particularly if there are other ethanol plants competing for corn, an extended drought or other production

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problems. Because the market price of ethanol is not necessarily tied to grain prices, ethanol producers are generally not able to compensate for increases in the cost of grain feedstock through adjustments in prices charged for their ethanol. Therefore, it can be expected that the profitability of ethanol production will be reduced during periods of high grain prices.

          We have recently hired a grain procurement manager to ensure the consistent scheduling of corn deliveries and to establish and fill forward contracts through grain elevators. The grain procurement manager will utilize forward contracting and hedging strategies, including certain derivative instruments such as futures and option contracts, to manage our commodity risk exposure and optimize finished product pricing on our behalf. We anticipate that most of our grain will be acquired in this manner. Forward contracts allow us to purchase corn for future delivery at fixed prices without using the futures market. The corn futures market allows us to trade in standard units of corn for delivery at specific times in the future. Option contracts consist of call options (options to purchase a fixed amount of a commodity) and put options (options to sell a fixed amount of a commodity). We expect to use a combination of these derivative instruments in our hedging strategies to help guard against corn price volatility. In October 2006, we obtained a $3.5 million revolving term note which we intend to use to finance hedging activities with respect to corn. Hedging means protecting the price at which we buy corn and the price at which we will sell our products in the future. It is a way to attempt to reduce the risk caused by price fluctuation. The effectiveness of such hedging activities will depend on, among other things, the cost of corn and our ability to sell enough ethanol and distillers grains to use all of the corn subject to futures and option contracts we have purchased as part of our hedging strategy. Although we will attempt to link hedging activities to sales plans and pricing activities, such hedging activities themselves can result in costs because price movements in corn contracts are highly volatile and are influenced by many factors that are beyond our control. We may incur such costs and they may be significant.

Utilities

          Our ethanol plant will require a significant and uninterrupted supply of electricity, natural gas and water to operate. We plan to enter into agreements with gas, electric and water utilities to provide our needed energy and water. There can be no assurance that those utilities will be able to reliably supply the gas, electricity and water that we need. If there is an interruption in the supply of energy or water for any reason, such as supply, delivery or mechanical problems, we may be required to halt production. If production is halted for an extended period of time, our financial performance may suffer.

          Natural Gas. The plant will produce process steam from its own boiler system and dry the distillers dried grains co-product via a direct gas-fired dryer. According to engineering specifications, we anticipate that our plant will require a natural gas supply of approximately 4,400 Million British Thermal Units (“MMBtu”) per day when drying. If the direct gas-fired dryer operates 100% of the time for an entire year, the plant could consume approximately 1,600,000 MMBtu per year. Natural gas is expected to be the second largest component of our production costs. Natural gas prices have historically fluctuated dramatically, which could significantly affect the profitability of our operations. On March 14, 2006, we entered into natural gas throughput service agreement with Northern Natural Gas Company of Omaha, Nebraska (“Northern”). Pursuant to the agreement, Northern will provide us natural gas transportation through a dedicated pipeline. We have agreed to pay Northern approximately $1,044,000 for the capital expenditures required for Northern to provide natural gas transportation to our plant. In addition, the agreement provides that we must pay a reservation fee of approximately $138,000, which Northern will retain until we are deemed creditworthy. Also on March 14, 2006, we signed an amendment to the natural gas throughput service agreement with Northern. The effective date of the amendment is February 1, 2007 and will run for a period of 10 years. Pursuant to the amendment, Northern will transport natural gas to our plant, subject to the successful installation of the necessary facilities. We will pay Northern a monthly fee for the natural gas transportation, and a commodity rate equal to the maximum rate provided for in Northern’s Federal Energy Regulatory Commission (“FERC”) gas tariff.

          On July 28, 2006, we entered into a Landfill Gas Purchase and Sale Agreement with L.P. Gill, Inc. (“L.P.”) for the purchase of landfill gas and reimbursement of equipment and systems for combustion of such gas to power our ethanol plant. Pursuant to this agreement, L.P. is required to design, construct, operate, maintain and repair all equipment used to extract, capture, handle, store and/or transport the landfill gas from a nearby sanitary landfill to the northern edge of our site. We are required to design, install, and maintain specific equipment and systems

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required for the combustion of landfill gas in our plant. As part of the agreement, L.P. will reimburse us for all expenses we may incur for the design and installation of equipment necessary for the combustion of the landfill gas at the ethanol plant. Such reimbursement is limited to $400,000, which must be paid by L.P. prior to the end of the fifth year after the commencement date. In addition, we are required to purchase from L.P. all of the landfill gas extracted from L.P.’s landfill. We are required to pay L.P. for each MMBtu provided to the plant at a price set forth in the contract. The Agreement is for a term of fifteen years from the commencement date. The Agreement is subject to termination by either party after a period of thirty days following the occurrence of certain events as set forth in the contract.

          Electricity. Based on engineering specifications, we anticipate that our ethanol plant will require approximately 4.5 million kilowatts of electricity at peak demand. In the State of Nebraska, electricity is supplied by Northeast Nebraska Public Power District, a utility owned by the people of Nebraska. Northeast Nebraska Public Power District has high voltage 69kV level transmission lines located on easements on our plant site that may be available to supply us with an on-site substation at primary voltage. We have not yet negotiated, reviewed or executed any agreement with Northeast Nebraska Public Power District to provide electricity to the site. The price at which we will be able to purchase electric services has not yet been determined. We have entered into an agreement with U.S. Energy Services, Inc. to help manage our energy supplies.

          Water. The production of ethanol requires a significant amount of water. While much of the water used in an ethanol plant is recycled back into the process, certain areas of production require fresh water. Those areas include boiler makeup water and cooling tower water. Boiler makeup water is treated on-site to minimize all elements that will harm the boiler and recycled water cannot be used for this process. Cooling tower water is deemed non-contact water because it does not come in contact with the mash, and, therefore, can be regenerated back into the cooling tower process. The makeup water requirements for the cooling tower are primarily a result of evaporation. Engineering specifications show our plant water requirements to be approximately 384 gallons per minute when producing 50 million gallons of ethanol per year. That is approximately 552,960 gallons per day. In order to meet this anticipated demand for water, we have installed two 900 gallon per minute wells at the site to handle our water needs. Soil borings performed at the plant location indicate the presence of an adequate water supply.

          Recycling water back into the process also reduces the amount of discharge water and wastewater treatment costs. Our plant design incorporates the ICM/Phoenix Bio-Methanator wastewater treatment process resulting in a zero discharge of plant process water. Based upon the water quality in Dakota County, we estimate that there will be 75 gallons per minute of non-contact cooling water discharge.

          On September 26, 2006, we entered into an Equipment and Services Agreement with U.S. Water Services of Cambridge, Minnesota(“USWS”) for the acquisition and installation of certain water treatment equipment at our ethanol plant. USWS also agrees to provide chemicals and ongoing support and services for the water treatment equipment. The chemical and servicing provisions of this agreement have an initial term of three years from the date our plant becomes operational and is renewable for additional one-year terms. Pursuant to this agreement, we will pay USWS approximately $1.7 million in connection with the acquisition and installation of the water treatment equipment. Under the chemical and service provisions of the agreement, we will pay USWS approximately $9,400 per month for necessary chemicals and support services. An additional initial payment $22,000 will be made to USWS for one-time use chemicals and laboratory equipment. Annual chemical cost is limited to approximately $113,000 based on 50 million gallons per year of ethanol production at the plant. For every one million gallons per year of ethanol production in excess of 50 million, we will pay USWS approximately $2,250 per year. If this agreement is renewed, prices are subject to increase.

Transportation

          Unlike gasoline and diesel fuel, ethanol cannot be shipped by pipeline because ethanol can be easily contaminated by water present in the pipelines. Water dilutes ethanol and creates significant quality control issues. Therefore, ethanol must be transported by rail or by truck. In general, we expect to transport our ethanol primarily by rail. On November 11, 2006, we entered into a Rail Service and Construction Agreement with Nebraska Northeastern Railroad (the “Railroad”) pursuant to which the Railroad will provide rail service to our Jackson, Nebraska ethanol production facility. Pursuant to this agreement, we are responsible for the construction of a

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sidetrack of approximately 0.8 mile in length running from the Railroad’s mainline to the entrance to our plant and of the tracks inside the plant yard. The Railroad will reimburse us for up to $537,000 of the cost of constructing the sidetrack subject to the condition that we complete and operate our ethanol plan. Upon completion of 50% of the plant, we will be entitled to $150,000 of such reimbursement, with the remainder due upon the first revenue movement of railcars to the plant. As a further condition to this reimbursement, we have guaranteed a minimum of 1,500 railcars per year to the plant for the first five years after completion of our ethanol plant. The Railroad will lease the sidetrack to us at no additional cost for our non-exclusive use. Any use by the Railroad of the sidetrack for other customers may not unreasonably interfere with our use of the sidetrack. We are required to maintain the sidetrack and the rails inside our plant yard at our own expense. If, after five year, the Railroad determines that there is insufficient rail traffic to our plant, it may require the payment of an annual continuation charge in order to keep the sidetrack in place.

          On December 7, 2006, we entered into two Railroad Car Lease Agreements (the “Car Leases”) with Trinity Industries Leasing Company (“Trinity”), pursuant to which we agreed to lease a total of 50 hopper cars which we will use to transport commodities to and from our ethanol plant. The first Car Lease is for 15 cars and provides for a base monthly rental per car of $668 and has a minimum lease term of 60 months. The second Car Lease is for 35 cars and provides for a base monthly rent per car of $618 and has a minimum term of 120 months. Each Car Lease will continue beyond the minimum term on a month-to-month basis until either party notifies the other of its intent to cancel such Car Lease. The base monthly rents under the Car Leases are subject to one-time adjustments as of the delivery dates of the first cars delivered based on (i) changes in yield to maturity of on-the-run ten year U.S. Treasury Notes yielding 4.42% at January 12, 2006 versus the yield to maturity on such notes as of the delivery date and (ii) changes to steel and other raw material costs over the estimated raw materials cost implicit in a sale price per car of $72,310. Monthly rates are also subject to escalation in the event of changes in car design required by the Department of Transportation, Association of American Railroads or other regulatory authorities. In addition, a surcharge of $0.03 per mile will be assessed for each mile in excess of 36,000 miles per year a car travels. We have secured our obligations under the Car Leases with an irrevocable standby bank letter of credit in the amount of $381,000.

          In addition to rail, we may try to service this market by truck. While truck transportation can be more expensive than rail transportation, there may be opportunities to reduce truck transport costs by negotiating backhaul rates from trucking companies which would normally drive to the refined fuels terminals empty.

Compliance with Environmental Laws

          We will be subject to extensive air, water and other environmental regulations and we will be required to obtain a number of environmental permits to construct and operate the plant. We anticipate incurring costs and expenses of approximately $200,000 in complying with environmental laws, including the cost of obtaining permits. Even if we are successful in obtaining all of the permits currently required, any retroactive change in environmental regulations, either at the federal or state level, could require us to obtain additional or new permits or spend considerable resources on complying with such regulations.

          We will be subject to oversight activities by the United States Environmental Protection Agency and a state environmental department. Both federal and state environmental rules are subject to change, and any such changes could result in greater regulatory burdens on our operations. In addition, we could become subject to environmental or nuisance claims from adjacent property owners or residents in the area arising from possible environmental contamination.

          It also is possible that federal or state environmental rules or regulations could be adopted that could have an adverse effect on the use of ethanol. For example, changes in the environmental regulations regarding ethanol’s use due to currently unknown effects on the environment could have an adverse effect on the ethanol industry.

7

Employees

          We currently have two full-time employees. Upon completion of our ethanol plant, we anticipate that we will employ approximately 32 full-time equivalent employees. The following table represents some of the anticipated positions within the plant and the minimum number of individuals we expect will be full-time personnel:

	Full-Time
Position	Personnel
General Manager		1
Plant Manager		1
Commodities Manager		1
Controller		1
Lab Manager		1
Lab Technician		2
Secretary/Clerical		3
Shift Supervisors		4
Office Manager		1
Maintenance Supervisor		1
Maintenance Craftsmen		4
Plant Operators		12
TOTAL		32

Item 2. DESCRIPTION OF PROPERTY.

          The ethanol plant is being constructed on an undeveloped 77.25-acre site located approximately one mile west of the Village of Jackson, Nebraska, in eastern Nebraska. We own fee title to the site and consider it to be adequate for our intended purpose. The property is encumbered by a first mortgage loan in favor of Farm Credit Services of America, FLCA in order to secure a $43,025,000 senior credit facility used to provide construction financing of the ethanol plant.

Item 3. LEGAL PROCEEDINGS.

          None.

Item 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

          None.

8

PART II

Item 5. MARKET FOR COMMON EQUITY, RELATED STOCKHOLDER MATTERS AND SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES.

          There is no public trading market for our units.

          As of September 30, 2006, we had 696 unit holders of record.

          We have not declared or paid any distributions on our units. Our Board of Directors has complete discretion over the timing and amount of distributions to our unit holders, however, our operating agreement requires the board of directors to endeavor to make cash distributions at such times and in such amounts as will permit our unit holders to satisfy the portion of their income tax liability resulting from their respective share of our taxable income. Under the terms of certain borrowing agreements, are ability to make distributions to our members will be restricted beginning in fiscal 2008 to an amount designed to approximate our members’ income tax liability on our net profit, if any. We will be able to pay distributions in excess of this amount during any fiscal years only if we have made the required free cash flow payment to the lender for such fiscal year. Our expectations with respect to our ability to make future distributions are discussed in greater detail in “MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.”

          During the time period beginning on our formation on August 12, 2004 and ending on November 19, 2004, we raised $975,000 in seed capital through a private placement of membership units. These units were sold pursuant to an exemption from registration provided for in Section 4(2) of the Securities Act and Rule 504 of Regulation D. We sold these units directly without use of an underwriter or placement agent and without payment of commissions or other remuneration.

          The Securities and Exchange Commission declared our Registration Statement on Form SB-2 (SEC Registration No. 333-123473) effective on August 8, 2005 and we commenced a public offering of our units shortly thereafter. We registered a total of 4,600 units at $10,000 per unit for an aggregate maximum gross offering price of $46,000,000. The Board of Directors terminated the offering on November 3, 2005 prior to the sale of the maximum number of registered units. During the offering, we sold 3,588 units for gross offering proceeds of $35,880,000. Certain of our officers and directors offered and sold the units on a best efforts basis without the assistance of an underwriter. We did not pay these officers or directors any compensation for services related to the offer or sale of the units. Expense incurred in connection with the offering of these units totaled approximately $424,000, resulting in net offering proceeds of approximately $35,456,000. As of September 30, 2006, all of the net proceeds of the offering had been applied to the payment of construction and start-up costs of our Jackson, Nebraska ethanol plant.

9

Item 6. MANAGEMENT’S DISCUSSION AND ANALYSIS OR PLAN OF OPERATIONS.

Overview

          Siouxland Ethanol, LLC is a development-stage Nebraska limited liability company that was formed on August 12, 2004 for the purpose of constructing and operating a dry mill corn-based ethanol plant near Jackson, Nebraska. We are in the process of building a plant with an anticipated capacity to produce 50 million gallons of denatured fuel grade ethanol and 160,000 tons of dried distillers’ grains per year. This plant is under construction and is expected to be completed in April 2007. In January 2006, we announced our intent to double the production capacity of our plant from an annual ethanol production capacity of 50 million gallons to 100 million gallons as quickly as that may be feasible.

Results of Operation

          We are still in the development phase and until the first phase of our ethanol plant is operational we will generate no revenues other than interest income earned on our cash balances. During the year ended September 30, 2006, we incurred operating expenses of $640,122, which consisted primarily of professional fees and general and administrative expenses, resulting in an operating loss of $640,122. During the year, we earned net interest income of $888,636, resulting in net income for the year of $246,454 or $71.46 per unit. At September 30, 2006, our accumulated deficit equaled $213,639. The results of operations during the year ended September 30, 2006 are not indicative of the future results of operations that we anticipate for the company once the initial phase of our ethanol plant begins commercial operations.

Liquidity and Capital Resources

          We expect that the total cost to complete the construction of the initial 50 million gallon per year ethanol plant and the associated infrastructure, land acquisition and development, and various start-up costs will be approximately $88 million by the time the plant commences operations in April 2007. We have expended approximately $58.5 million to date in connection with these activities. Construction costs of the proposed 50 million gallon per year expansion are expected to approximate the total costs associated with bringing the first 50 million gallon plant into production.

          We are financing the costs of the initial plant with a combination of equity and debt as described below. We are still considering financing options with respect to the proposed plant expansion and have no commitments with respect to providing such financing at this time.

          Equity Financing. Through November 19, 2004, we raised $975,000 in seed capital through a private placement of membership units. We filed a Registration Statement for an initial public offering of our units with the Securities and Exchange Commission on Form SB-2 (SEC Registration No. 333-123473), as amended, which became effective on August 8, 2005 and sold 3,588 units for $35,880,000 in our registered offering which closed on November 3, 2005.

          Credit Facility. On May 4, 2006, we entered into a credit agreement with Farm Credit Services of America, FLCA (“Farm Credit”) establishing a senior credit facility with Farm Credit for the construction of our ethanol plant. The construction financing is in the amount of $43,025,000 consisting of a $32,268,750 term loan and a $10,756,250 revolving loan. In October 2006, we amended our credit agreement with Farm Credit to add a revolving term note for up to $3,500,000, subject to borrowing base limitations, until November 2007. Borrowings under the revolving term note will be primarily used for corn hedging activities. The amount available to us under the new revolving term note is also reduced by the amount of a standby letter of credit totaling $381,000 that we provided under the terms of two rail car leases.

          We must pay interest on the borrowed funds at a variable rate equivalent to LIBOR Short Term Index Rate plus 3.0%. The variable rate shall be adjusted at the LIBOR Short Term Index Rate plus 2.85% for any year after 2006 in which, at the end of the preceding year, our owners’ equity is equal to or greater than 60% provided we are not otherwise in default. Interest will be calculated on a 360 day basis. We paid an origination fee of $322,687 to

10

Farm Credit for the loans. We will pay an annual administration fee of $25,000 to Farm Credit. For the revolving loan and the revolving term loan, we will pay commitment fees of ¹/2 of 1% per annum and 0.35% per annum, respectively on the unused portions of the borrowing capacity. The revolving term note is secured a common credit agreement along with the revolving promissory note and the term note described above.

          We are obligated to repay the term construction loan in 30 equal, consecutive, quarterly principal installments of $1,075,625 plus accrued interest, with the first installment due on December 1, 2007 or no later than 6 months after substantial completion of the ethanol plant, and the last installment due on June 1, 2015. During construction we will make monthly payments of interest only. On the earlier of September 1, 2015 or three months following repayment of the term loan we will begin repayment on the revolving term loan in 10 equal, consecutive, quarterly principal installments of $1,075,625 plus accrued interest with the last installment due on the later of December 1, 2017 or ten calendar quarters from the date repayment begins. During the term of the loan, we are required to make special principal payments in an annual amount equal to 65% of our excess cash flow for each year, not to exceed $2,000,000 in any fiscal year. These payments will continue until an aggregate sum of $6,000,000 has been paid to Farm Credit.

          The loans will be secured by a first mortgage on our real estate and a lien on all of our personal property. If we prepay any portion of the construction loans prior to December 1, 2008, we will pay a prepayment charge of 3% in addition to certain surcharges. This prepayment charge will be reduced by 1.0% each year thereafter and any prepayment made on the construction loan after December 1, 2010 will not be subject to a prepayment charge. During the term of the loans, we will be subject to certain financial loan covenants consisting of minimum working capital, minimum debt coverage, and minimum tangible net worth. After the construction phase, we will only be allowed to make annual capital expenditures up to $500,000 annually without prior approval. The loan agreements also impose restrictions on our ability to make cash distributions to our members. For each fiscal year commencing with fiscal 2008, we may make a distribution to our members of 40% of the net profit for such fiscal year, provided that no event of default or potential default exists. We may make distributions in a fiscal year exceeding 40% of net profit only if we have made the required excess cash flow payment to Farm Credit for that fiscal year. We must be in compliance with all financial ratio requirements and loan covenants before and after any distributions to our members.

          Upon an occurrence of an event of default or an event which will lead to our default, Farm Credit may upon notice terminate its commitment to loan funds and declare the entire unpaid principal balance of the loans, plus accrued interest, immediately due and payable. An event of default includes, but is not limited to, our failure to make payments when due, insolvency, any material adverse change in our financial condition or our breach of any of the covenants, representations or warranties we have given in connection with the transaction.

          Tax Increment Financing. On September 28, 2006, we completed a tax increment financing transaction through the placement and sale of $4,030,000 Tax Increment Revenue Bonds, Taxable Series 2006A (the “Bonds”) issued by the Community Redevelopment Authority of the Village of Jackson, Nebraska (the “Issuer”) for the purpose of financing certain public redevelopment costs in connection with the Facility. We received net proceeds of approximately $3,819,000 from the issuance of the Bonds, of which approximately $838,000 are held in a capitalized interest fund and a debt service reserve fund. In connection with this financing, we entered into the following agreements:

     (i) a Redevelopment Contract, dated July 20, 2006, by and between us and the Issuer (the “Redevelopment Contract”);

     (ii) a Guaranty Agreement, dated September 28, 2006, from us to the Issuer (the “Guaranty”);

     (iii) a Subordinate Deed of Trust, Assignment of Leases and Rents and Security Agreement Fixture Filing Statement, dated September 28, 2006, made by us in favor of Wells Fargo Bank, National Association, as trustee of the Bonds (the “Deed of Trust”); and

     (iv) a Debt Subordination Agreement, dated September 28, 2006, by and among us, Wells Fargo Bank, National Associations, as trustee of the Bonds, and Farm Credit Services of America FLCA (the “Subordination Agreement”).

11

          The Bonds bear interest at a fixed rate of 10% per annum on the outstanding principal. Principal of, and interest on, the Bonds are payable semi-annually, on June 1 and December 1, commencing on June 1, 2007 for interest and June 1, 2008 for principal. The Bonds mature on December 1, 2021, but are subject to early redemption on or after June 1, 2011.

          In general, principal and interest on the Bonds is payable solely from (i) proceeds of the Bonds deposited into a capitalized interest fund and (ii) incremental real estate taxes paid by us on the Facility allocable to the Issuer (the “Tax Increment Revenues”). However, under the terms of the Redevelopment Contract, we are obligated to make payments to the Issuer in lieu of real estate taxes if for any reason the Tax Increment Revenues are not sufficient to pay principal and interest on the Bonds. This obligation is represented by the Guaranty under which we have guaranteed to the holders of the Bonds full and prompt payment of principal, premium, if any, and interest on the Bonds when due, whether at maturity, upon acceleration or otherwise. Our obligations under the Redevelopment Contract and the Guaranty are secured by the pledge of the real property on which the Facility is located, along with all improvements, equipment and fixtures making up the Facility, rents and profits from the Facility and certain other assets made in favor of the trustee of the Bonds under the Deed of Trust. Under the Subordination Agreement, the trustee of the Bonds has agreed to subordinate its rights to exercise its remedies against us to the rights of Farm Credit Services of America, FLCA with respect to the $43,025,000 senior credit facility that we obtained on May 4, 2006.

          Under the terms of the Redevelopment Agreement, we are obligated to construct the Facility and operate it until at least January 1, 2022. Until that date, we may not sell, transfer or encumber the Facility without the consent of the Issuer.

          As of September 30, 2006, we had cash and cash equivalents (other than restricted cash) of approximately $4.2 million and total assets of approximately $56.5 million. We expect that the funds available to us from our equity and debt financings will be sufficient to cover all costs associated with construction of the initial 50 million gallon per year ethanol plant and the associated infrastructure, including, but not limited to, site acquisition and development, utilities, construction and equipment acquisition and to provide adequate working capital, when combined with anticipated revenues produced from the sale of ethanol and distillers grains produced at the plant, to meet our operating expenses going forward. However, there is no assurance that the funds available to us will be sufficient to cover our anticipated capital needs and operating expenses, particularly if there are unanticipated delays in the commencement of commercial production of ethanol and distillers grains from the initial phase of the ethanol plant, if the sale of ethanol and distillers grains do not produce revenues in the amounts currently anticipated or if our operating costs, including specifically the cost of corn and other inputs, are greater than anticipated. In addition, if we determine to proceed with the expansion of the ethanol plant’s productive capacity from 50 million to 100 million gallons per year, we will need to obtain additional funds of approximately $80,000,000. We would expect to finance the costs of any such expansion through a combination of additional debt and equity financing along with retained earnings from the operation of the initial 50 million gallon per year phase of the ethanol plant.

          Employment and Investment Growth Act Project Agreement. On March 15, 2006, we entered into an Employment and Investment Growth Act Project Agreement with the State of Nebraska Department of Revenue. The Agreement provides that upon our hiring at least 30 new individuals, and our involvement in a qualified business activity resulting in an investment of at least $3,000,000 in qualified property prior to September 30, 2011, the State agrees to allow the Company the use of several incentives. We may elect annually to determine taxable income for Nebraska income tax purposes by multiplying federal taxable income by the sales factor only. This calculation was first available to be used for 2005, and is available for each year thereafter for a period of fourteen years beginning in the year the required employees are hired and the applicable investment in property is made. In addition, upon meeting the required minimum levels of employments and investments required by the Employment and Investment Growth Act, we will be entitled to: (1) claim a refund once each quarter, for a period of six years, for sales and use taxes paid on purchases and leases of tangible property used or incorporated into an improvement of real estate as part of the project and placed in service after January 14, 2005; (2) tax credits equal to 5% of the amount of compensation paid during the year to employees who are Nebraska employees or who have been employed by the Company since September 30, 2004 (base-year employees) that exceeds the average compensation paid at the project multiplied by the number of base-year employees; and (3) a tax credit of 10% of the investment made in qualified property located and used at the project calculated by the total cost of property required to be capitalized, less the amount of Nebraska state and local option sales or use taxes subject to refund. The tax credits

12

are available to us for a period of six years. If at any time we fail to meet the required levels of employment and investment during the six year period following the year the Application was submitted for the incentives, all or a portion of the incentives and any penalties applicable thereto will be recaptured or disallowed.

Application of Critical Accounting Estimates

          Management uses estimates and assumptions in preparing our financial statements in accordance with accounting principles generally accepted in the United States. These estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. We do not believe that any of the significant accounting policies described in the notes to the financial statements is critical at this time, however we expect to continue to review our accounting policies as we commence operation of our ethanol plant in order to determine if any of these accounting policies are critical.

Off-Balance Sheet Arrangements

          We do not have any off-balance sheet arrangements.

13

Item 7. FINANCIAL STATEMENTS.

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

Audit Committee and
Board of Directors
Siouxland Ethanol, LLC
Jackson, Nebraska

We have audited the accompanying balance sheet of Siouxland Ethanol, LLC (a development stage company), as of September 30, 2006 and 2005, and the related statements of operations, changes in members’ equity, and cash flows for the fiscal years ended September 30, 2006 and 2005 and for the period from inception (August 12, 2004) to September 30, 2006. These financial statements are the responsibility of the Company’s management. Our responsibility is to express an opinion on these financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Siouxland Ethanol, LLC, (a development stage company) as of September 30, 2006 and 2005, and the results of its operations and its cash flows for the fiscal years ended September 30, 2006 and 2005 and for the period from inception (August 12, 2004) to September 30, 2006, in conformity with U.S. generally accepted accounting principles.

/s/ Boulay, Heutmaker, Zibell & Co. P.L.L.P.

Certified Public Accountants

Minneapolis, Minnesota
December 26, 2006

14

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Balance Sheet

	September 30,			September 30,
	2006			2005
ASSETS
Current Assets
Cash and equivalents	$	4,160,253		$	213,598
Restricted cash		246,550			—
Other receivables		5,437			—
Prepaid and other		39,168			28,920
Total current assets		4,451,408			242,518
Property and Equipment
Land		752,302			—
Office equipment		28,294			11,042
Construction in progress		50,186,153			—
		50,966,749			11,042
Less accumulated depreciation		(2,865	)		(626	)
Net property and equipment		50,963,884			10,416
Other Assets
Restricted cash		591,198			—
Deferred loan costs and other		517,628			—
Deferred offering costs		—			387,133
Land options and other		—			7,000
		1,108,826			394,133
Total Assets	$	56,524,118		$	647,067
LIABILITIES AND EQUITY
Current Liabilities
Accounts payable	$	142,833		$	129,709
Accrued expenses		9,081			2,451
Construction payable		11,064,425			—
Total current liabilities		11,216,339			132,160
Long-Term Debt		9,030,000			—
Commitments and Contingencies
Members’ Equity
Member contributions, net of cost of raising capital, 3,789 and 195 units outstanding at September 30, 2006 and 2005, respectively		36,491,418			975,000
Deficit accumulated during development stage		(213,639	)		(460,093	)
Total members’ equity		36,277,779			514,907
Total Liabilities and Members’ Equity	$	56,524,118		$	647,067

Notes to Financial Statements are an integral part of this Statement.

15

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Statement of Operations

	Year Ended			Year Ended			From Inception
	September 30,			September 30,			(August 12, 2004) to
	2006			2005			September 30, 2006
Revenues	$	—		$	—		$	—
Operating Expenses
Professional fees		362,675			338,053			733,358
General and administrative		277,447			91,242			368,976
Total operating expenses		640,122			429,295			1,102,334
Operating Loss		(640,122	)		(429,295	)		(1,102,334	)
Other Income (Expense)
Interest income		888,636			—			888,636
Other income		1,463			2,119			3,582
Interest expense		(3,523	)		—			(3,523	)
Total other income, net		886,576			2,119			888,695
Net Income (Loss)	$	246,454		$	(427,176	)	$	(213,639	)
Weighted Average Units Outstanding		3,449			175			1,698
Net Income (Loss) Per Unit	$	71.46		$	(2,441.01	)	$	(125.82	)

Notes to Financial Statements are an integral part of this Statement.

16

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)
Period from August 12, 2004 (Date of Inception) to September 30, 2006

Statement of Changes in Members’ Equity

Balance — August 12, 2004	$	—
Capital contributions - 10 units, $5,000 per unit, August 2004		50,000
Net loss for the year ended September 30, 2004		(32,917	)
Balance — September 30, 2004		17,083
Capital contributions - 185 units, $5,000 per unit, November 2004		925,000
Net loss for the year ended September 30, 2005		(427,176	)
Balance — September 30, 2005		514,907
Capital contributions - 3,588 units, $10,000 per unit, November 2005		35,880,000
Cost of raising capital		(423,582	)
Equity units exchanged for services, 6 units, $10,000 per unit, September 2006		60,000
Net income for the year ended September 30, 2006		246,454
Balance — September 30, 2006	$	36,277,779

Notes to the Financial Statements are an integral part of this Statement.

17

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Statement of Cash Flows

	Year Ended			Year Ended			From Inception
	September 30,			September 30,			(August 12, 2004) to
	2006			2005			September 30, 2006
Cash Flows from Operating Activities
Net income (loss)	$	246,454		$	(427,176	)	$	(213,639	)
Adjustments to reconcile net income (loss) to net cash from operations:
Depreciation and amortization		2,239			626			2,865
Equity units exhanged for services		60,000			—			60,000
Change in assets and liabilities
Restricted cash		(837,748	)		—			(837,748	)
Other receivable		(5,437	)		—			(5,437	)
Prepaid and other		(7,748	)		(28,920	)		(36,668	)
Accounts payable		18,527			92,926			142,833
Accrued expenses		6,630			2,451			9,081
Net cash provided used in operating activities		(517,083	)		(360,093	)		(878,713	)
Cash Flows from Investing Activities
Payment for land options and other		—			(7,000	)		(7,000	)
Capital expenditures		(39,886,782	)		(11,042	)		(39,897,824	)
Net cash used in investing activities		(39,886,782	)		(18,042	)		(39,904,824	)
Cash Flows from Financing Activities
Proceeds from bridge financing loan		760,000			—			760,000
Payments on bridge financing loan		(760,000	)		—			(760,000	)
Proceeds from long-term debt		5,000,000			—			5,000,000
Payments for financing costs and other		(362,486	)		—			(362,486	)
Proceeds from TIF financing		3,874,858			—			3,874,858
Member contributions		35,880,000			925,000			36,855,000
Payments for deferred offering costs		(41,852	)		(380,480	)		(423,582	)
Net cash provided by financing activities		44,350,520			544,520			44,943,790
Net Increase in Cash and Equivalents		3,946,655			166,385			4,160,253
Cash and Equivalents – Beginning of Period		213,598			47,213			—
Cash and Equivalents – End of Period	$	4,160,253		$	213,598		$	4,160,253
Supplemental Cash Flow Information
Cash paid during the period for:
Interest	$	3,523		$	—		$	3,523
Supplemental Disclosure of Noncash Investing and Financing Activities
Land options exercised for land purchased	$	4,500		$	—		$	4,500
Construction in progress in construction payable	$	11,064,425		$	—		$	11,064,425
Debt loan costs financed with TIF financing	$	155,142		$	—		$	155,142
Deferred offering costs offset against member contributions	$	423,582		$	—		$	423,582
Deferred offering costs included in accounts payable	$	—		$	5,403		$	—
Equity units exchanged for services	$	60,000					$	60,000

Notes to Financial Statements are an integral part of this Statement.

18

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Notes to Financial Statements

September 30, 2006 and 2005

1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business

Siouxland Ethanol, LLC, (a Nebraska Limited Liability Company) was organized to pool investors to build a 50 million gallon annual production ethanol plant in Dakota County, Nebraska. In January 2006, the Company announced its plans to double the size of the plant which is under construction from a 50 million gallon ethanol plant to a 100 million gallon ethanol plant after the initial plant construction is complete. The Company is still considering financing options for the expansion. As of September 30, 2006, the Company is in the development stage with its efforts being principally devoted to organizational activities and construction of the 50 million gallon plant. The Company anticipates completion of the plant in the spring of 2007.

Fiscal Reporting Period

The Company has adopted a fiscal year ending September 30 for reporting financial operations.

Accounting Estimates

Management uses estimates and assumptions in preparing these financial statements in accordance with generally accepted accounting principles of the United States of America. Those estimates and assumptions affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities, and the reported revenues and expenses. Actual results could differ from those estimates.

Cash and Equivalents

The Company considers all highly liquid debt instruments with a maturity of three months or less to be cash and equivalents.

The Company maintains its accounts primarily at three financial institutions. At times throughout the year, the Company’s cash and equivalents balances may exceed amounts insured by the Federal Deposit Insurance Corporation.

Restricted Cash

The Company maintains cash accounts set aside for capital interest and debt service requirements as part of the tax increment revenue financing. At September 30, 2006, the total of these accounts was approximately $838,000. There were no restricted cash amounts at September 30, 2005.

Property and Equipment

Property and equipment is stated at the lower of cost or estimated fair value. Depreciation and amortization are provided over estimated useful lives by use of the straight-line method. Maintenance and repairs are expensed as incurred; major improvements and betterments are capitalized.

Deferred Loan Costs

Costs associated with the issuance of loans are recorded as deferred loan costs. Loan costs will be amortized over the life of the loan using the effective interest method. There were no amortization expenses related to deferred loan costs in fiscal 2006 or 2005.

19

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Notes to Financial Statements

September 30, 2006 and 2005

Deferred Offering Costs

The Company deferred the costs incurred to raise equity financing until that financing occurred. In November 2005, the issuance of new equity occurred and costs of approximately $424,000 were netted against the proceeds received.

Grants

The Company recognizes grant income as other income for reimbursement of expenses incurred upon complying with the conditions of the grant. For reimbursements of capital expenditures, the grants are recognized as a reduction of the basis of the asset upon complying with the conditions of the grant.

Income Taxes

Siouxland Ethanol, LLC is treated as a partnership for federal and state income tax purposes, and generally does not incur income taxes. Instead its earnings and losses are included in the income tax returns of the members. Therefore, no provision or liability for federal and state income taxes has been included in these financial statements.

Fair Value of Financial Instruments

The carrying value of cash and equivalents, receivables and payables approximates their fair value.

It is not currently practicable to estimate the fair value of the debt financing. Because these agreements contain certain unique terms, covenants, and restrictions, as discussed in Note 6, there are no readily determinable similar instruments on which to base an estimate of fair value.

Recently Issued Accounting Pronouncements

Management has reviewed recently issued, but not yet effective, accounting pronouncements and does not expect the implementation of these pronouncements to have a significant effect on the Company’s financial statements.

2. DEVELOPMENT STAGE ENTERPRISE

The Company was formed on August 12, 2004 to have a perpetual life. The Company was initially capitalized by members who contributed an aggregate of $100,000 for 20 membership units. Additionally, the Company was further capitalized by additional members, contributing an aggregate of $875,000 for 175 units in November 2004.

The Company raised additional equity through a Form SB-2 Registration Statement with the Securities and Exchange Commission. The equity offering was closed effective November 3, 2005 along with the termination of the escrow agreement and issuance of the 3,588 membership units totaling $35,880,000. The Company offset proceeds from the equity offering with offering costs of $423,582.

Income and losses are allocated to all members based upon their respective percentage of units held. See Note 3 for further discussion of members’ equity.

3. MEMBERS’ EQUITY

As specified in the Company’s operating agreement, the Company is authorized to issue up to 7,000 membership units. The Company has one class of membership units, which include certain transfer restrictions as specified in the operating agreement and pursuant to applicable tax and securities laws.

20

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Notes to Financial Statements

September 30, 2006 and 2005

4. CONSTRUCTION IN PROGRESS

Amounts included in construction in progress as of September 30, 2006 are as follows:

Construction costs	$	50,052,656
Capitalized interest		20,070
Insurance and other costs		113,427
	$	50,186,153

The Company capitalizes construction costs and construction period interest until the assets are placed in service. The construction payable of approximately $11,064,000 includes approximately $2,923,000 of retainage.

5. INCOME TAXES

The differences between financial statement basis and tax basis of assets are as follows:

	September 30,		September 30,
	2006		2005
Financial statement basis of total assets	$	56,524,118	$	647,067
Organizational costs expensed for financial reporting purposes		1,091,930		456,456
Taxable income tax basis of total assets	$	57,616,048	$	1,103,523

There were no differences between the financial statement basis and tax basis of the Company’s liabilities.

21

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Notes to Financial Statements

September 30, 2006 and 2005

6. LONG-TERM DEBT

Long-term debt consists of the following at September 30:

	2006		2005
Term note payable to lending institution, see terms below	$	5,000,000	$	—
Tax increment financing, see terms below		4,030,000		—
Total long-term debt	$	9,030,000	$	—

Term Note

The Company obtained debt financing for the construction of the ethanol plant from a lending institution in the form of a revolving promissory note, as described below, and a term note. The term note provides for borrowings up to $32,268,750. The Company is required to make interest payments for both loans during the construction phase at the three-month LIBOR plus 3%, which totaled 8.37% at September 30, 2006. The Company is required to make 30 quarterly principal installments of $1,075,625 plus accrued interest beginning six months following substantial completion, but no later than December 1, 2007, payable in full in June 2015. In addition to the scheduled payments, the Company will be required to make additional principal payments equal to 65% of the Company’s excess cash flow not to exceed $2,000,000 per fiscal year and an aggregate total of $6,000,000. As part of the financing agreement, the premium above LIBOR may be reduced to 2.85% for any year after 2006 based on a financial ratio.

The financing agreement requires an annual servicing fee of $25,000. The Company is initially permitted to make distributions up to 40% of net income. For fiscal 2008 and thereafter, the Company may make distributions which exceed 40% of net income as long as the Company has made the required excess cash flow payments and maintained the required financial covenants. The financing agreement contains certain prepayment fees in the first three years of the scheduled payments.

Revolving Promissory Note

The Company has a revolving promissory note of up to $10,756,250 as part of the construction loan described above with its lending institution. The Company is required to pay interest on the principal advances monthly at the three-month LIBOR rate plus 3%. Beginning in September 2015 or three months after the repayment of the term note described above, the Company is required to make 10 quarterly installments of $1,075,625 plus accrued interest until December 1, 2017. The Company did not have an outstanding balance on the revolving promissory note at September 30, 2006 or 2005. The Company pays a commitment fee of .5% on the unused portion of the revolving promissory note. The revolving promissory note as well as the term note described above are subject to a common credit agreement with various financial and non-financial covenants that limit distributions, require minimum debt service coverage, net worth and working capital requirements, and secured by all business assets.

Revolving Term Note

In October 2006, the debt financing agreement with the lending institution was amended to add a revolving term note for up to $3,500,000, subject to borrowing base limitations, until November 2007. Interest accrues at the three-month LIBOR plus 3% and is payable monthly beginning in December 2006. The Company will be obligated to pay the lender an unused commitment fee equal to .35% on the unused portion. The Company has issued a standby letter of credit totaling $381,000 related to rail car leases described in Note 9, which reduces the amounts available

22

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Notes to Financial Statements

September 30, 2006 and 2005

on the revolving term note. The revolving term note is secured with a common credit agreement along with the revolving promissory note and the term note described above.

Tax Increment Financing (TIF)

In July 2006 the Community Redevelopment Authority of the Village of Jackson, Nebraska (“Authority”) approved the issuance of Tax Increment Revenue Bonds, Taxable Series 2006A (Siouxland Ethanol, LLC Project) in the total amount of $4,030,000 on behalf of Siouxland Ethanol, LLC (“the Company”). The Bond issuance is for the purpose of providing financing for a portion of the costs of construction of the Company’s ethanol plant (the “Project”). These bonds were issued in one series in September 2006 and bear an interest rate of 10%. The bonds are secured by a subordinate deed of trust in which the Company’s land and facilities have been pledged as collateral, in subordination to the Company’s senior debt holder. The Company has also guaranteed the bonds. As such, the bond liability and related accounts have been recorded on the Company’s balance sheet.

In connection with the issuance of the bonds, the Authority and the Company entered into a Redevelopment Contract (“Contract”). Under the terms of the Contract, the bond proceeds are to be used for Project costs, for the establishment of special funds held by the bond trustee for interest and principal payments and reserves (the “Capitalized Interest Fund” and the “Debt Service Reserve Fund”), and for debt issuance costs. The approximate amounts of the uses of the bond proceeds are as follows: available for Project costs $2,981,000; Capitalized Interest Fund $435,000; Debt Service Reserve Fund $403,000; and debt issuance costs $211,000.

Under the Contract, the Company agreed that it intends to create taxable real property in the Project of at least $25 million no later than January 1, 2007. Additionally, the Company agrees to complete the Project and then operate it not less than 15 years from January 1, 2007. The Company may not convey, assign, or transfer the Project prior to the expiration of the 15 year period without the prior written consent of the Authority. If the Company were to default on the Contract, including not completing the Project on or before July 1, 2007 under circumstances construed to be within the Company’s control, liquidated damages plus interest could be charged against the Company.

The Company will be assessed taxes on the value of the Project (“Tax Increment Revenues”) which will be paid by the Company to a special debt service fund and then used to pay the payments required on the bonds. The Company has guaranteed that if such assessed Tax Increment Revenues are not sufficient for the required bond payments, the Company will provide such funds as are needed to fund the shortfall.

The bonds mature in semi-annual increments commencing June 1, 2008. The semi-annual increments commence at $5,000 and increase to $615,000, with a final maturity of December 31, 2021. Interest on the bonds is payable semi-annually on June 1 and December 1, commencing on June 1, 2007. The Company has the option to redeem or purchase the bonds in whole or in part on or after June 1, 2011. The Bonds are also subject to special semi-annual redemption provisions commencing June 1, 2008.

In connection with the bond issuance, the Authority also authorized a Series 2006B Note to the Company under which additional funding to the Company is contingently committed. Under the terms of the agreement the Authority may provide additional funding to the Company up to $2,000,000 to reimburse the Company for Project costs the Company has paid. However, any such funding to the Company would only be paid if there were Tax Increment Revenues remaining once the bonds have been fully paid. This funding commitment bears no interest and no amounts have been recorded in the accompanying financial statements due to the contingent nature of the agreement.

23

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Notes to Financial Statements

September 30, 2006 and 2005

Bridge Financing

In October 2005, the Company obtained a bridge financing loan to purchase land under option for approximately $760,000. The loan incurred interest at the 7.05% and was due on December 1, 2005. In November 2005, the Company repaid the loan with proceeds from the equity offering.

The estimated maturities of long-term debt at September 30, 2006 are as follows:

2007	$	—
2008		4,307,500
2009		772,500
2010		155,000
2011		170,000
After 2011		3,625,000
Total long-term debt	$	9,030,000

7. COMMITMENTS AND CONTINGENCIES

Land Contracts

In October 2005, the Company exercised options on the primary site for the ethanol plant and purchased some additional land for a total of approximately 77 acres at a total cost of approximately $752,000. The remaining option on the alternative site was not exercised and expired in December 2005.

Construction Contracts

The total cost of the project, including the construction of the ethanol plant and start-up expenses is expected to approximate $80,500,000. In January 2006, the Company signed a lump-sum design-build agreement with a general contractor, a related party, for a fixed contract price of $56,619,000. As part of the contract, the Company paid a mobilization fee, subject to retainage. Monthly applications are submitted for work performed with final payment due upon final completion. The design-build agreement includes a provision whereby the general contractor receives an early completion bonus for each day the construction is complete prior to 485 days. The contract may be terminated by the Company upon a ten day written notice subject to payment for work completed, termination fees, and any applicable costs and retainage. An employee of the general contractor is an investor and director of the Company. An affiliate of the general contractor is an investor in the Company. As of September 30, 2006, the Company has incurred approximately $41,159,000 for these services with approximately $10,038,000 included in construction payable including retainage amounts.

In October 2005, the Company entered into an agreement with an unrelated party for Phase I grading and drainage at the plant site for approximately $1,500,000 including change orders. Work began on the contract in October 2005 and was completed in March 2006.

In January 2006, the Company entered into an agreement with an unrelated party for foundation and site preparation for approximately $1,353,000 including change orders. Work related to this agreement was completed in March 2006.

In February 2006, the Company entered into an agreement with an unrelated party to provide pre-cast concrete bridge construction for approximately $1,043,000. The agreement is terminable by the Company upon a twenty-one day written notice subject to payment for work completed. Work has begun on the bridge construction and is

24

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Notes to Financial Statements

September 30, 2006 and 2005

expected to be completed in December 2006. As of September 30, 2006, the Company has incurred approximately $599,000 for these services.

In April 2006, the Company entered into an agreement with an unrelated party for foundation and site preparation for the grain handling and storage system for approximately $819,000. Work related to this agreement was completed August 2006.

In May 2006, the Company entered into an agreement with an unrelated party for construction of the office building for approximately $275,000. Work related to this agreement was completed in November 2006.

In June 2006, the Company entered into an agreement with an unrelated party for site primary electrical distribution system services for approximately $527,000. The agreement is terminable by either party subject to specific guidelines and payment for work completed. Work related to this agreement was completed in November 2006. As of September 30, 2006, the Company has incurred approximately $240,000 for these services.

In June 2006, the Company entered into an agreement with an unrelated party for the rail spur track construction for approximately $679,000. Work has begun on this contract and is expected to be completed in January 2007.

In September 2006, the Company entered into an agreement with an unrelated party for the site underground utility package for approximately $810,000. The agreement is terminable by either party subject to specific guidelines and payment for work completed. Work has begun on the underground utility package and is expected to be completed in December 2006. In November 2006, the Company signed a change order for approximately $423,000, resulting in a total cost of approximately, $1,233,000. As of September 30, 2006, the Company has incurred approximately $500,000 for these services.

Consulting Contracts

In January 2005, the Company entered into a consulting agreement with two related parties to provide services relating to contract negotiation, marketing, and the securing of debt financing. The Company paid these consultants cash bonuses of $40,000 in November 2005 and issued six units in September 2006. These consultants are investors of the Company. One is a current director of the Company and the other is a former director.

In October 2005, the Company entered into an agreement with an unrelated party to locate a suitable production water supply for the plant which includes test drilling. The estimated costs for these services are approximately $319,000. Work was completed in November 2006.

In September 2006, the Company entered into an agreement with an unrelated party to establish a risk management plan with respect to the Company’s grain origination, energy and transportation, procurement and output sales. The Company will pay a monthly fee of $0.001 per gallon of ethanol produced estimated to be approximately $4,200 per month. The initial term of the agreement is for one year from the date the Company begins ethanol production and will automatically renew for an additional term unless notice is given four months prior to the end of the initial term.

Marketing Agreements

In February 2006, the Company entered into a marketing agreement with an unrelated party to purchase all of the distillers dried grains with solubles (DDGS) the Company is expected to produce. The buyer agrees to pay the Company a percentage of the selling price, subject to a minimum amount per ton. The agreement commences when the Company begins producing DDGS and continues for one year initially and is terminable thereafter by either party with four months notice.

In March 2006, the Company entered into a marketing agreement with an unrelated party for the sale of ethanol the Company is expected to produce. The Company agrees to pay the buyer a percentage of the sales price for certain

25

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Notes to Financial Statements

September 30, 2006 and 2005

marketing, storage, and transportation costs. The initial term is for two years beginning in the month when ethanol production begins with renewal options thereafter in one year increments.

Utility Contracts

In March 2006, the Company entered into an agreement with an unrelated party to provide all natural gas required by the Company for the period from February 2007 or the date the facilities are installed and for ten years thereafter. The agreement requires minimum charges over the ten year period of approximately $50,000 per month beginning at the start of production. The Company also is required to make a construction security payment and demand payment totaling approximately $1,182,000 related to the pipeline construction which may be partially refundable based on the Company’s credit history.

In September 2006, the Company entered into an agreement with an unrelated party for the acquisition and installation of water treatment equipment. The agreement also provides for chemicals and ongoing support and services for the water treatment equipment for an initial term of three years from the date the plant becomes operational and is renewable for additional one year terms. The Company will pay approximately $1,700,000 for the equipment and then $9,400 per month beginning in April 2007 for the necessary chemicals and support services based on name plate production.

Landfill Gas Contract

In July 2006, the Company entered into an agreement with a related party to purchase all of the extracted landfill gas for use as fuel in one or more burners at the plant. The Company agrees to purchase all gas extracted from the landfill at a specified price per MMBtu as set forth in the contract. In addition, the Company will be reimbursed up to $400,000 for the design, installation and maintenance of specific equipment and systems required to be paid by the end of the fifth year from the commencement date. The initial term is for fifteen years beginning when operations commence. Either party may terminate the agreement subject to specific guidelines in the agreement. The owner of the landfill is an investor of the Company.

Grant

In June 2006, the Company was a beneficiary of a Community Development Block Grant received by Dakota County from Nebraska’s Department of Economic Development. The grant will not exceed $77,500 and will be used to assist with constructing a road to the plant. As part of the grant, the Company must create and maintain a specified number of jobs, which principally benefit low to moderate income persons. If the grant conditions are not fulfilled, the Company and the County will be obligated to repay the grant to the Department of Economic Development.

8. RELATED PARTY TRANSACTIONS

The Company has incurred costs from related party transactions as further described in Note 7. As of September 30, 2006, the Company has incurred approximately $41,159,000 in costs related to the design-build agreement of which approximately $10,038,000 is included in construction payable. During fiscal 2006, the Company paid two consultants $40,000 and issued six units as part of the services performed. The Company has not incurred costs related to the landfill gas agreement as of September 30, 2006.

9. SUBSEQUENT EVENTS

Rail Service and Construction Agreement

In November 2006, the Company entered into a rail service and construction agreement with an unrelated party to provide rail service to the ethanol plant. The Company will be responsible for the construction of a sidetrack from

26

SIOUXLAND ETHANOL, LLC
(A Development Stage Company)

Notes to Financial Statements

September 30, 2006 and 2005

the mainline to the entrance of the plant and the tracks inside the plant. The Company will be reimbursed approximately $537,000 for the cost of constructing the sidetrack of which $150,000 is due upon 50% completion of the plant. The remainder will be due when operations begin. The Company guarantees it will ship a minimum of 1,500 rail cars in each of the first five years after completion of the ethanol plant. In the event the minimum is not met in any of the years, the Company will pay $75 for each car short of the minimum. In addition, the Company will lease, at no additional cost, the sidetrack for their non-exclusive use. Either party may terminate the agreement following the five year term with thirty days notice.

Rail Car Lease Agreement

In December 2006, the Company entered into a five-year lease agreement for fifteen covered hopper cars and a ten-year lease agreement for thirty-five covered hopper cars with an unrelated party. The Company will pay approximately $1,286 per car per month for the first five years and then approximately $618 per car per month for the remaining five years of the lease agreement starting when the rail cars are delivered. The base monthly rents under the lease agreements are subject to a one-time adjustment as of the delivery of the first cars based on interest rate changes and raw material cost increases. In addition, a surcharge of $0.03 per mile will be assessed for each mile in excess of 36,000 miles per year a car travels. The Company provided a standby letter of credit for approximately $381,000 as described in Note 6.

Expansion Design Build Letter of Intent

In December 2006, the Company signed a letter of intent with the current general contractor as discussed in Note 7 to design and build a 50 million gallon expansion of the ethanol plant at a total contract price of approximately $56,875,000. This letter of intent does not include all costs of the expansion. The contract price is subject to price increases based on factors including increases in construction costs and the timing until notice to proceed is given. The letter of intent shall terminate on December 31, 2007 unless the basic size and design of the expansion have been agreed upon and minimum funding is met. As part of the letter of intent, the Company paid a $500,000 non-refundable commitment fee in December 2006, which was recorded in construction in progress. It is reasonably possible that the expansion may not proceed, at which point this payment will be expensed.

27

Item 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURE.

     None.

Item 8A. CONTROLS AND PROCEDURES.

     Our management, including Tom Lynch, our President and Chairman (principal executive officer), and John Kingsbury, our Treasurer (principal financial officer), have reviewed and evaluated the effectiveness of our disclosure controls and procedures as of September 30, 2006. Based upon their review and evaluation, these officers believe that our disclosure controls and procedures are effective in ensuring that material information related to us is recorded, processed, summarized and reported within the time periods required by the forms and rules of the Securities and Exchange Commission.

     Our management, consisting of our President and Chief Executive Officer and our Treasurer, have reviewed and evaluated any changes in our internal control over financial reporting that occurred during the quarter ended September 30, 2006 and there has been no change that has materially affected or is reasonably likely to materially affect our internal control over financial reporting.

Item 8B. OTHER INFORMATION.

     None.

PART III

Item 9. DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS AND CONTROL PERSONS; COMPLIANCE WITH SECTION 16(a) OF THE EXCHANGE AC.

Directors and Executive Officers

     The following persons serve as our executive officers and directors:

     Tom Lynch, Chairman, President and Director. Mr. Lynch, age 66, has served on our board of directors since the company’s inception. Mr. Lynch retired from the Burlington Northern Santa Fe Rail Road in July of 1995 where he held the position of General Superintendent of Operations. For the past five years and continuing through the present, he manages Lynch Properties, Inc., a family owned farm and recreational property in Dakota County, Nebraska. Mr. Lynch will serve as a director until the first member meeting following substantial completion of our plant, and until a successor is elected and qualified, or until his earlier death, resignation, removal or disqualification. He will serve as Chairman and President until his resignation or removal from office by the board.

     Pam Miller, Vice Chairperson, Vice President and Director. Ms. Miller, age 47, has served on our board of directors since the company’s inception. Ms. Miller has been employed by Northeast Community College since January of 2005 as the South Sioux City Education Center Coordinator. In addition, since January of 2003, she has also been employed on a part-time basis as the Dakota County Commissioner. Ms. Miller also owns a construction company with her husband in Homer, Nebraska. Beginning in August of 1996 through December of 2004, she was an adjunct facility member at Morningside College. Ms. Miller was also an adjunct faculty member at Western Iowa Tech Community College from June of 1997 until May of 2004. Ms. Miller serves on several boards in the region, including the Nebraska Loess Hills RC&D, Dakota County Interagency Team (DCIT), South Sioux City Chamber of Commerce Legislative Committee, Siouxland Interstate Metropolitan Planning Council (SIMPCO), and Siouxland Regional Economic Development Committee. Ms. Miller will serve as a director until the first member meeting following substantial completion of our plant, and until a successor is elected and qualified, or until her earlier death, resignation, removal or disqualification. She will serve as Vice Chairman and Vice President until her resignation or removal from office by the board.

28

     John Kingsbury, Director and Treasurer. Mr. Kingsbury, age 59, has served on our board of directors since the company’s inception. Mr. Kingsbury is the President and CEO of the Bank of Dixon County since 1997. The Bank of Dixon County has several locations throughout northeast Nebraska, including a branch in Jackson. Mr. Kingsbury also is the principal owner of BDC Insurance since 1974. Mr. Kingsbury also serves on the Nebraska Department of Roads Highway Commission. He is a member of the Nebraska Chamber of Commerce and Industry. Mr. Kingsbury will serve as a director until the first member meeting following substantial completion of our plant, and until a successor is elected and qualified, or until his earlier death, resignation, removal or disqualification. He will serve as Treasurer until his resignation or removal from office by the board.

     Doug Garwood, Secretary and Director. Mr. Garwood, age 63, has served on our board of directors since the company’s inception. Since January of 1999, Mr. Garwood has been the co-owner and operator of Garwood Enterprises, which consists of a 2,400 acre farming operation and trucking company. Mr. Garwood currently serves on the Dakota County Economic Development Committee, South Sioux Chamber of Commerce, and the Nebraska Boys and Girls Home Board of Directors. Mr. Garwood will serve as a director until the first member meeting following substantial completion of our plant, and until a successor is elected and qualified, or until his earlier death, resignation, removal or disqualification. He will serve as Secretary until his resignation or removal from office by the board.

     Ronald Wetherell, Director. Mr. Wetherell, age 61, has served on our board of directors since the company’s inception. Mr. Wetherell is the current chairman of the board of directors of Little Sioux Corn Processors, LLC in Marcus, Iowa. Little Sioux Corn Processors, LLC is a public company and files reports with the Securities and Exchange Commission. He is also the owner and operator of Wetherell Manufacturing Company in Cleghorn, Iowa and has been for 40 years. Mr. Wetherell is currently the chairman of the Cherokee County Board of Supervisors. He also owns numerous farming operations throughout northwest Iowa. Mr. Wetherell will serve as a director until the first member meeting following substantial completion of our plant, and until a successor is elected and qualified, or until his earlier death, resignation, removal or disqualification.

     Darrell Downs, Director. Mr. Downs, age 68, has served on our board of directors since the company’s inception. Prior to his retirement in 1994, Mr. Downs was employed by Moorman Manufacturing Company for 38 years. He has also been the mayor of Marcus, Iowa for the past 6 years and he has served as a consultant for Cherokee County Economic Development in Cherokee County, Iowa since 2003. Mr. Downs is on the board of directors of Little Sioux Corn Processors, LLC in Marcus, Iowa. Little Sioux Corn Processors, LLC is a public company and files reports with the Securities and Exchange Commission. Mr. Downs also rents out farmland throughout northwest Iowa and has been doing this for 20 years. Mr. Downs will serve as a director until the first member meeting following substantial completion of our plant, and until a successor is elected and qualified, or until his earlier death, resignation, removal or disqualification.

     Shennen Saltzman, Director. Mr. Saltzman, age 39, has served on our board of directors since the company’s inception. Since August of 1997, Mr. Saltzman has been the owner of SEP, LLC, which owns and operates 12 Burger King restaurants with locations in Sioux City, Iowa; Yuma, Arizona; and Imperial Valley, California. He has also been a farmer/rancher who owns farmland in Dakota County since 2001. Beginning in December 1989 until he purchased SEP, LLC in August of 1997, Mr. Saltzman was an executive vice president at Pioneer Bank in Sioux City, Iowa. He serves on the Pioneer Bank Board of Directors, Briar Cliff University Board of Trustees, the Siouxland Initiative, and the Dakota County Economic Development Committee. Mr. Saltzman will serve as a director until the first member meeting following substantial completion of our plant, and until a successor is elected and qualified, or until his earlier death, resignation, removal or disqualification.

     Donald ‘Skip’ Meisner, Director. Mr. Meisner, age 70, has served on our board of directors since the company’s inception. Since March of 2001, Mr. Meisner has operated Meisner Management Services, LLC, which provides management of public works projects for local units of government. Examples of activities of Meisner Management Services, LLC include working to coordinate and manage flood control projects, bridges and housing developments and facilitating strategic planning for governments and their agencies. For the five years prior to March of 2001, Mr. Meisner served as Executive Director of the Siouxland Interstate Metropolitan Planning Council (SIMPCO). He currently serves on the board of the Siouxland Community Foundation and the Tri-State Graduate Study Center. Meisner owns ground in Knox County, Nebraska. Mr. Meisner will serve as a director until the first

29

member meeting following substantial completion of our plant, and until a successor is elected and qualified, or until his earlier death, resignation, removal or disqualification.

     Matt Sederstrom, Director. Mr. Sederstrom, age 33, has served on our board of directors since the company’s inception. Mr. Sederstrom is employed by Fagen, Inc. as a project developer for fuel ethanol facilities and has been since June of 2001. Prior to his employment with Fagen, Inc., he was employed by Schott Corporation beginning in 1999 as a marketing representative. Mr. Sederstrom will serve as a director until the first member meeting following substantial completion of our plant, and until a successor is elected and qualified, or until his earlier death, resignation, removal or disqualification.

     Craig Ebberson, Director. Mr. Ebberson, age 52, has served on our board of directors since the company’s inception. Mr. Ebberson operates a 10,000 acre farm in northeast Nebraska which consists of corn, soybeans and alfalfa since 1970. He also owned and operated a 6,000 head commercial cattle feed yard since 1970. Mr. Ebberson also owns Kerloo Creek Ranch, Inc., a family owned ranch and Wynot River Farms, LLC. He is a member of the Nebraska Cattlemen’s Association, Nebraska Corn Association and Nebraska Soybean Association. Mr. Ebberson will serve as a director until the first member meeting following substantial completion of our plant, and until a successor is elected and qualified, or until his earlier death, resignation, removal or disqualification.

     David Bailey Aalfs. Mr. Aalfs, age 68, has served on our board of directors since October 27, 2005. Mr. Aalfs is retired. From 1977 to 2006, Mr. Aalfs served as the CEO of Sabre Communications Corporation, a leading manufacturer of communication towers. Mr. Aalfs will serve as a director until the first member meeting following substantial completion of our plant, and until a successor is elected and qualified, or until his earlier death, resignation, removal or disqualification.

Adoption of Code of Ethics

     Our board of directors has adopted a code of ethics that applies to our principal executive officer, Tom Lynch and our principal financial officer, John Kingsbury. Both of these individuals signed an acknowledgment of his receipt of our code of ethics. Our code of ethics is filed as Exhibit 14.1 to this annual report on Form 10-KSB.

     Any person who would like a copy of our code of ethics may contact the company at (402) 632-2676. Upon request the company will provide copies of the code of ethics at no charge to the requestor.

Audit Committee

     The board of directors has appointed an audit committee for the purpose of overseeing the accounting and financial reporting processes of the company and audits of the company’s financial statements. The audit committee consists of Pam Miller, Donald Meisner and D. Bailey Aalfs. The chairperson of the audit committee is Pam Miller.

Audit Committee Financial Expert

     The board of directors has not designated any member of our audit committee as an audit committee financial expert. The board of directors is in the process of evaluating the experience and education of our audit committee members in order to determine whether one or more of our current audit committee members qualifies as an audit committee financial expert.

Item 10. EXECUTIVE COMPENSATION.

     During the fiscal year ended September 30, 2006, we did not compensate any of our executive officers or directors for services provided to the company as such. Darrell Downs, a director, and Bill Riechers, a former director, served as our consultants in connection with, among other things, securing our debt and equity financing for the initial phase of our ethanol plant, and received compensation as such under a written consulting agreement. Mr. Riechers received a one-time cash payment of $25,000 upon execution of the consulting agreement and a weekly payment of $300 per day up to and not exceeding $1,500 per week. In addition, upon obtaining debt

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financing for the project, Mr. Riechers received a one-time cash bonus of $35,000 and four units in Siouxland Ethanol. Mr. Downs received a one-time cash payment of $5,000 upon execution of the consulting agreement and a weekly payment of $150 per day up to and not exceeding $750 per week. In addition, upon obtaining debt financing for the project, Mr. Downs received a one-time cash bonus of $5,000 and two units in Siouxland Ethanol.

     We reimburse our officers and directors for expenses incurred relating to services rendered on our behalf. Other than the consulting agreement we have with Bill Riechers and Darrell Downs, we do not have any employment or compensation agreements with any officer or director.

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Item 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND RELATED STOCKHOLDER MATTERS.

     The following table sets forth the beneficial ownership of the company’s membership units by each director and executive officer of the company, by all executive officers and directors of the company as a group and by each other person believed by the company to beneficially own more than 5% of the outstanding membership units of the company. Unless otherwise noted, all persons listed in the following table have sole voting and investment power over the membership units they beneficially own and own such membership units directly.

	Amount and
	Nature of
	Beneficial	Percent of
Name and Address of Beneficial Owner	Ownership	Class
Tom Lynch, Chairman, President and Director 1221 Monona Blvd. Jackson, NE 68743	14 units		*
Pam Miller, Vice Chairman, Vice President and Director 414 Howard St. Homer, NE 68030	6 units		*
John Kingsbury, Treasurer and Director P.O. Box 570, Ponca, NE 68770	12 units		*
Doug Garwood, Secretary and Director 520 Timberline Dr., South Sioux City, NE 68776	21 units		*
Ronald Wetherell, Director P.O. Box 188, Cleghorn, IA 51015	15 units		*
Darrell Downs, Director P.O. Box 103, Marcus, IA 51035	6 units		*
Shennen Saltzman, Director 729 E. 7th St., Suite 2, South Sioux City, NE 68776	65 units		1.72	%
Donald “Skip” Meisner, Director 3116 Everett St., Sioux City, IA 51106	9 units		*
Matt Sederstrom, Director 1005 Boxelder Ave., Marshall, MN 56258	6 units		*
Craig Ebberson, Director 56521 870th Rd., Belden, NE 68716	37 units		*
David Bailey Aalfs, Director(1) 920 Quail Hollow Circle, Dakota Dunes, SD 57047	300 units		7.93	%
All Directors and Executive Officers as a group (11 persons)	491 units		13.03	%

*	Represents less than 1% of the outstanding membership units
1.	Mr. Aalfs jointly owns all 300 Units with his wife Kathleen M. Aalfs

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Equity Compensation Plans

     The following equity compensation plan information summarizes plans and securities approved and not approved by security holders as of September 30, 2006:

					Number of securities
					remaining available for
	Number of Securities to				future issuance under
	be issued upon the		Weighted-average		equity compensation
	exercise of outstanding		exercise price of		plans (excluding
	options, warrants and		outstanding options,		securities reflected in
Plan Category	rights		warrants and rights		column (a))
Equity compensation plans approved by security holders				n/a		—
Equity compensation plans not approved by security holders1		6		n/a		0

1. Consists of units issued to Messrs. Downs and Riechers under terms of consulting agreements described under Item 10 “EXECUTIVE COMPENSATION”, above.

Item 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS.

Transactions with Fagen, Inc.

     On January 9, 2006, we entered into a design-build agreement with Fagen, Inc. (“Fagen”) for the construction of the initial 50 million gallon per year dry grind ethanol production facility. Matt Sederstrom, an employee of Fagen, is a member and director of Siouxland Ethanol. Under the terms of the design-build agreement, we will pay Fagen $56,619,000, subject to any mutually agreed-upon adjustments and subject to a credit for any amounts previously paid to Fagen Engineering, LLC for engineering performed pursuant to a Phase I and Phase II Engineering Services Agreement for the plant.

     In January 2006, we announced our intent to double the production capacity of our plant from an annual ethanol production capacity of 50 million gallons to 100 million gallons as quickly as that may be feasible. On December 11, 2006, we entered into a binding letter of intent with Fagen under which Fagen will provide us with certain services necessary for us to develop a detailed description of a 50 million gallon per year expansion to our ethanol production facility which is currently under construction in Jackson, Nebraska and to establish a price for which Fagen would provide design, engineering, procurement of equipment and construction services for such an expansion. The purpose of the description is to develop pro forma cost data to determine if the expansion can be financed. Under the letter of intent, Fagen has an exclusive right to provide design, engineering, procurement of equipment and construction services for the proposed expansion. If we determine that the expansion of the plant is economically feasible, we will enter into a Lump Sum Design-Build contract with Fagen for the design, engineering, procurement of equipment and construction services for the expansion. Certain of the terms of such a Design-Build contract are described in the letter of intent. The letter of intent has a term ending December 31, 2007 unless the basic size and design of the expansion has been determined and we have raised at least 10% of the necessary equity to finance the project. The term may be extended by mutual agreement of the parties.

     We have not paid and we do not intend to pay any compensation to Matt Sederstrom in connection with any transaction between us and Fagen. We believe that the terms of our transactions with Fagen are on terms and conditions that are comparable to those that we could have obtained from an unaffiliated third party.

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Transactions with Directors

     During the fiscal year ended September 30, 2006, we did not compensate any of our executive officers or directors for services provided to us as such. Darrell Downs, a director, and Bill Riechers, a former director, served as our consultants in connection with, among other things, securing debt and equity financing for the initial phase of our ethanol plant, and received compensation as such under a written consulting agreement. Mr. Riechers received a one-time cash payment of $25,000 upon execution of the consulting agreement and a weekly payment of $300 per day up to and not exceeding $1,500 per week. In addition, upon obtaining debt financing for the project, Mr. Riechers received a one-time cash bonus of $35,000 and four units in Siouxland Ethanol. Mr. Downs received a one-time cash payment of $5,000 upon execution of the consulting agreement and a weekly payment of $150 per day up to and not exceeding $750 per week. In addition, upon obtaining debt financing for the project, Mr. Downs received a one-time cash bonus of $5,000 and two units in Siouxland Ethanol.

Item 13. EXHIBITS.

Exhibit No.	Exhibit
3.1	Articles of Organization of Siouxland Ethanol, LLC. Filed as Exhibit 3.1 to the company’s registration statement on Form SB-2 (Commission File 333-123473) and incorporated by reference herein.
3.2	Amended and Restated Operating Agreement of Siouxland Ethanol, LLC. Filed as Exhibit 3.2 to the company’s registration statement on Form SB-2 (Commission File 333-123473) and incorporated by reference herein.
4.1	Form of Membership Certificate. Filed as Exhibit 4.1 to the company’s registration statement on Form SB-2 (Commission File 333-123473) and incorporated by reference herein.
4.2	Form of Subscription Agreement. Filed as Exhibit 4.2 to the company’s registration statement on Form SB-2 (Commission File 333-123473) and incorporated by reference herein.
4.3	Amended and Restated Escrow Agreement. Filed as Exhibit 4.3 to Pre-Effective Amendment No. 3 to the company’s registration statement on Form SB-2 (Commission File 333-123473) dated July 22, 2005 and incorporated by reference herein.
10.1	Phase I Grading and Drainage Contract dated October 14, 2005. Filed as Exhibit 10.1 to Annual Report on Form 10-KSB (Commission File 333-123473) filed by the company on December 15, 2005 and incorporated by reference herein.
10.2	Promissory Note (Installment Loan) and Loan Agreement dated October 14, 2005 Filed as Exhibit 10.2 to Annual Report on Form 10-KSB (Commission File 333-123473) filed by the company on December 15, 2005 and incorporated by reference herein.
10.3	Phase I and II Engineering Services Agreement dated November 11, 2005. Filed as Exhibit 10.3 to Annual Report on Form 10-KSB (Commission File 333-123473) filed by the company on December 15, 2005 and incorporated by reference herein
10.4	Standard Form of Agreement and General Conditions between Owner and Contractor for Auger Cast Grout Piles dated January 6, 2006 with Blackhawk Foundation Co. Filed as Exhibit 10.1 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on February 14, 2006 and incorporated by reference herein
10.5	Lump-Sum Design-Build Agreement dated January 9, 2006 with Fagen, Inc. Filed as Exhibit 10.2 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on February 14, 2006 and incorporated by reference herein

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Exhibit No.	Exhibit
10.6	License Agreement dated January 20, 2006 with ICM, Inc. Filed as Exhibit 10.3 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on February 14, 2006 and incorporated by reference herein
10.7	Construction Management Services Agreement dated October 1, 2005 and accepted February 14, 2006 with Timothy R. Smith. Filed as Exhibit 10.1 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on May15, 2006 and incorporated by reference herein
10.8	Standard Form of Agreement and General Conditions between Owner and Contractor for Precast Concrete Bridge Construction dated February 17, 2006 with Elk Horn Construction. Filed as Exhibit 10.2 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on May15, 2006 and incorporated by reference herein
10.9	Distiller’s Grain Marketing Agreement dated March 2, 2006 with Commodity Specialist Company. Filed as Exhibit 10.3 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on May15, 2006 and incorporated by reference herein
10.10	Firm Throughput Service Agreement dated March 14, 2006 with Northern Natural Gas Company. Filed as Exhibit 10.4 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on May15, 2006 and incorporated by reference herein
10.11	Ethanol Marketing Agreement dated March 29, 2006 with Archer Daniels Midland Co. Filed as Exhibit 10.5 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on May15, 2006 and incorporated by reference herein
10.12	Credit Agreement dated May 4, 2006 with Farm Credit Services of America, FLCA. Filed as Exhibit 10.6 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on May15, 2006 and incorporated by reference herein
10.13	Term Note dated May 4, 2006 with Farm Credit Services of America, FLCA. Filed as Exhibit 10.7 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on May15, 2006 and incorporated by reference herein
10.14	Revolving Term Note dated May 4, 2006 with Farm Credit Services of America, FLCA. Filed as Exhibit 10.8 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on May15, 2006 and incorporated by reference herein
10.15	Standard Form of Agreement and General Conditions between Owner and Contractor for Grain Handling and Storage System Auger Piling and Soil Stabilization dated April 13, 2006, with McCormick Construction. Filed as Exhibit 10.1 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on August, 2006 and incorporated by reference herein
10.16	Contract Agreement dated May 1, 2006 with Walsh-Hohenstein and Hohenstein Construction Co. Filed as Exhibit 10.2 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on August, 2006 and incorporated by reference herein
10.17	Standard Form of Agreement and General Conditions between Owner and Contractor for Rail Spur Track Construction dated June 13, 2006 with Volkmann Railroad Builders. Filed as Exhibit 10.3 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on August, 2006 and incorporated by reference herein

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Exhibit No.	Exhibit
10.18	Standard Form of Agreement and General Conditions between Owner and Contractor for Site Primary Electrical Distribution System with Thompson Electric Co. . Filed as Exhibit 10.4 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on August, 2006 and incorporated by reference herein
10.19	Landfill Gas Purchase and Sale Agreement dated July 28, 2006 with L.P. Gill, Inc. Filed as Exhibit 10.5 to Quarterly Report on Form 10-QSB (Commission File 333-123473) filed by the company on August, 2006 and incorporated by reference herein
10.20	Standard Form of Agreement and General Conditions, dated September 18, 2006, between the company and Mark Albenesius, Inc.
10.21	Equipment and Services Agreement, dated September 26, 2006, between the company and U.S. Water Services.
10.22	Redevelopment Contract, dated July 20, 2006, by and between the company and the Community Redevelopment Authority of the Village of Jackson, Nebraska relating to $4,030,000 Tax Increment Revenue Bonds, Taxable Series 2006A
10.23	Guaranty Agreement, dated September 28, 2006, from the company to the Community Redevelopment Authority of the Village of Jackson, Nebraska relating to $4,030,000 Tax Increment Revenue Bonds, Taxable Series 2006A.
10.24	Subordinate Deed of Trust, Assignment of Leases and Rents and Security Agreement Fixture Filing Statement, dated September 28, 2006, made by the company in favor of Wells Fargo Bank, National Association, as trustee of $4,030,000 Tax Increment Revenue Bonds, Taxable Series 2006A issued by the Community Redevelopment Authority of the Village of Jackson, Nebraska.
10.25	Debt Subordination Agreement, dated September 28, 2006, by and among the company, Wells Fargo Bank, National Associations, as trustee of $4,030,000 Tax Increment Revenue Bonds, Taxable Series 2006A issued by the Community Redevelopment Authority of the Village of Jackson, Nebraska and Farm Credit Services of America FLCA.
14.1	Code of Ethics of Siouxland Ethanol, LLC. Filed as Exhibit 14.1 to Annual Report on Form 10-KSB (Commission File 333-123473) filed by the company on December 15, 2005 and incorporated by reference herein
31.1	Certificate pursuant to 17 CFR 240.13a-14(a).
31.2	Certificate pursuant to 17 CFR 240.13a-14(a).
32.1	Certificate pursuant to 18 U.S.C. § 1350.
32.2	Certificate pursuant to 18 U.S.C. § 1350.

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Item 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.

     The aggregate fees billed by the principal independent public accountants (Boulay, Heutmaker, Zibell & Co. P.L.L.P.) to the company for the fiscal year ended September 30, 2006, and the fiscal year ended September 30, 2005 are as follows:

Category	Year		Fees
Audit Fees		2006	$	83,336
		2005	$	57,174
Audit-Related Fees		2006		—
		2005		—
Tax Fees		2006		—
		2005		—
All Other Fees		2006		—
		2005		—

     The performance of all audit, audit-related and tax services for the company by Boulay, Heutmaker, Zibell & Co. P.L.L.P. were pre-approved by our Audit Committee.

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SIGNATURES

     In accordance with Section 13 or 15(d) of the Exchange Act, the registrant caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

	SIOUXLAND ETHANOL, LLC
Date: December 22, 2006	/s/ Tom Lynch
	Tom Lynch
	Chairman and President (Principal Executive Officer)
Date: December 22, 2006	/s/ John Kingsbury
	John Kingsbury
	Treasurer (Principal Financial and Accounting Officer)

     In accordance with the Exchange Act, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Date: December 22, 2006	/s/ Tom Lynch
	Tom Lynch, Chairman, President and Director
Date: December 22, 2006	/s/ Pam Miller
	Pam Miller, Vice Chairman, Vice President and Director
Date: December 22, 2006	/s/ John Kingsbury
	John Kingsbury, Treasurer and Director
Date: December 22, 2006	/s/ Doug Garwood
	Doug Garwood, Secretary and Director
Date: December 22, 2006	/s/ Ronald Wetherell
	Ronald Wetherell, Director
Date: December 22, 2006	/s/ Darrell Downs
	Darrell Downs, Director
Date: December 22, 2006	/s/ Shennen Saltzman
	Shennen Saltzman, Director
Date: December 22, 2006	/s/ Donald Meisner
	Donald Meisner, Director
Date: December 22, 2006	/s/ Matt Sederstrom
	Matt Sederstrom, Director
Date: December 22, 2006	/s/ Craig Ebberson
	Craig Ebberson, Director
Date: December 22, 2006	/s/ David B. Aalfs
	David B. Aalfs, Director

38

EX-10.20

Exhibit 10.20

THE ASSOCIATED GENERAL CONTRACTORS OF AMERICA

STANDARD FORM OF AGREEMENT AND
GENERAL CONDITIONS BETWEEN OWNER
AND CONTRACTOR
(Where the Contract Price is a Lump Sum)

TABLE OF ARTICLES

1. AGREEMENT

2. GENERAL PROVISIONS

3. CONTRACTOR’S RESPONSIBILITIES

4. OWNER’S RESPONSIBILITIES

5. SUBCONTRACTS

6. CONTRACT TIME

7. CONTRACT PRICE

8. CHANGES

9. PAYMENT

10. INDEMNITY, INSURANCE AND WAIVERS

11. TERMINATION OF THE AGREEMENT, SUSPENSION AND NOTICE TO CURE

12. DISPUTE RESOLUTION

13. MISCELLANEOUS PROVISIONS

14. CONTRACT DOCUMENTS

     This Agreement has important legal and insurance consequences. Consultation with an attorney and insurance consultant is encouraged with respect to its completion or modification.

AGC DOCUMENT NO. 200 STANDARD FORM OF AGREEMENT AND GENERAL CONDITIONS BETWEEN OWNER AND CONTRACTOR
(Where the Contract Price is a Lump Sum)
1997, The Associated General Contractors of America

1

STANDARD FORM OF AGREEMENT AND
GENERAL CONDITIONS BETWEEN OWNER AND CONTRACTOR
(Where the Contract Price is a Lump Sum)

ARTICLE 1

1) AGREEMENT

This Agreement is made this 18th day of September in the year 2006 by and between the

     a) OWNER

Siouxland Ethanol, LLC
Box 147
Jackson, NE 68743

and the

     b) CONTRACTOR

Mark Albenesius, Inc.
970 Ithaca Way
Dakota City, NE 68731

for services in connection with the following

     c) PROJECT

Siouxland Ethanol, LLC 50 MGY Ethanol Plant

Phase 2, Site Underground Utility Package

Notice to the parties shall be given at the above addresses.

AGC DOCUMENT NO. 200 STANDARD FORM OF AGREEMENT AND GENERAL CONDITIONS BETWEEN OWNER AND CONTRACTOR
(Where the Contract Price is a Lump Sum)
1997, The Associated General Contractors of America

2

Section 1.02 ARTICLE 2

GENERAL PROVISIONS

2.1 RELATIONSHIP OF PARTIES The Owner and the Contractor agree to proceed with the Project on the basis of good faith and fair dealing.

2.1.1 The Contractor shall furnish construction administration and management services and use the Contractor’s best efforts to perform the Work in an expeditious manner consistent with the Contract Documents. The Owner shall endeavor to promote harmony and cooperation among the Owner, Contractor and Others.

2.1.2 The Contractor represents that it is an independent contractor and that in its performance of the Work it is and shall act as an independent contractor.

2.1.3 Neither Contractor nor any of its agents or employees will act on behalf of or in the name of Owner unless authorized in writing by Owner’s Representative.

2.2 EXTENT OF AGREEMENT This Agreement is solely for the benefit of the parties, represents the entire and integrated agreement between the parties, and supersedes all prior negotiations, representations or agreements, either written or oral. The Owner and Contractor agree to look solely to each other with respect to the performance of the Contract. The Contract and each and every provision thereof is for the exclusive benefit of the Owner and Contractor and not for the benefit of any third party nor any third party beneficiary thereof, except to the extent expressly provided in the Contract.

2.3 DEFINITIONS

.1 Changed Work means work which is deleted or omitted from, or different from the original scope of Work.

.2 The Contract Documents consist of this Agreement, the drawings, specifications, addenda issued prior to execution of the Contract, approved Shop Drawings, subsurface information, if available, and other documents listed in this Agreement and any modifications issued after execution of this Agreement.

.3 The Contract Time is the period between the Date of Commencement and final completion. See Article 6.

.4 The Date of Commencement of the Work is the date established in the Agreement. See Subparagraph 6.1.1.

.5 The term Day shall mean calendar day unless otherwise specifically defined.

.6 Defective Work is any portion of the Work which is not in conformance with the Contract Documents as more fully described in Paragraphs 3.5 and 3.8.

.7 Designer means the licensed design professional, and its consultants, retained by Owner to perform design services for the Project.

.8 Extra Work means work which is in addition to the original scope of the Work.

.9 Fee means salaries and other mandatory or customary compensation of the Contractor’s employees at its principal and branch offices; general and administrative expenses of the Contractor’s principal and branch offices other than the field office; and the Contractor’s capital expenses, including interest on the Contractor’s capital employed for the Work; and profit.

.10 Materials means any tangible item to be incorporated into the Work including, but not limited to, all materials, equipment, machinery, and parts, whether furnished by Contractor, its Subcontractors or material suppliers, the Owners or Others.

.11 Others means other contractors and all persons at the Worksite who are not employed by Contractor, its subcontractors or material suppliers.

.12 Owner is the person or entity identified as such in this Agreement and includes the Owner’s representative or the Owner’s representative’s designers, and the Designer.

.13 The Project, as identified in Article 1, is the building, facility and/or other improvements for which the Contractor is to provide services under this Agreement. It may also include construction by the Owner or Others.

.14 A Subcontractor is a party or entity retained by the Contractor as an independent contractor to provide the labor, materials, equipment and/or services necessary to complete a specific portion of the Work. The term Subcontractor does not include the Designer or Others as defined in this Paragraph.

.15 Substantial Completion of the Work, or of a designated portion, occurs on the date when the Contractor’s obligations are sufficiently complete in accordance with the Contract Documents so that the Owner may occupy or utilize the Project, or a designated portion, for the use for which it is intended. The issuance of a certificate of occupancy is not a prerequisite for Substantial Completion if the inability to obtain the Certificate of Occupancy is due to factors beyond the Contractor’s control. This date shall be confirmed by a certificate of Substantial Completion signed by the Owner and Contractor. The certificate shall state the respective responsibilities of the Owner and Contractor for security, maintenance, heat, utilities, damage to the Work, and insurance. The certificate shall also list the items to be completed or corrected, and establish the time for their completion and correction.

.16 A Subsubcontractor is a person or entity who has a contract with a Subcontractor to perform any portion of the Work. The term “Subsubcontractor” is referred to throughout the Contract Documents as if singular in number and means a Subsubcontractor or an authorized representative of the Subsubcontractor.

AGC DOCUMENT NO. 200 STANDARD FORM OF AGREEMENT AND GENERAL CONDITIONS BETWEEN OWNER AND CONTRACTOR
(Where the Contract Price is a Lump Sum)
1997, The Associated General Contractors of America

3

.17 Supplies means any tangible item which is used to perform the Work or is necessary to perform the Work but will not be incorporated into the Work including, but not limited to, equipment, tools, machinery, apparatus and scaffolding.

.18 The term Work means the construction and services necessary or incidental to fulfill the Contractor’s obligations for the Project in conformance with this Agreement and the other Contract Documents. The Work may refer to the whole Project or only a part Of the Project if work is also being performed by the Owner or Others.

.19 Worksite means the geographical area at the location mentioned in Article 1 where the Work is to be performed.

ARTICLE 3

CONTRACTOR’S RESPONSIBILITIES

3.1 GENERAL RESPONSIBILITIES

3.1.1 The Contractor shall provide all labor, materials, equipment, and services necessary to complete the following Work for the Project, all of which shall be provided in full accord with and reasonably inferable from the Contract Documents as being necessary to produce the indicated results.

3.1.2 The Contractor is responsible for the supervision and coordination of all of the Work, including the construction means, methods, techniques, sequences and procedures utilized, unless the Contract Documents give other specific instructions. In such case, the Contractor shall not be liable to the Owner for damages resulting from compliance with such instructions unless the Contractor recognized and failed to timely report to the Owner any error, inconsistency, omission or unsafe practice that it discovered in the specified construction means, methods, techniques, sequences or procedures.

3.1.3 The Contractor shall confine operations at the site to areas permitted by law, ordinances, permits and the Contract Documents and shall not unreasonably encumber the site with materials or equipment.

3.2 COOPERATION WITH WORK OF OTHERS

3.2.1 The Owner reserves the right to perform construction or operations related to the Project with the Owner’s own forces, and to award separate contracts in connection with other portions of the Project or other construction or operations on the site under contractual provisions identical or substantially similar to those in this agreement, including those portions related to insurance, waiver of subrogation and safety.

3.2.2 The Owner shall provide for coordination of the activities of the Owner’s own forces and those of Others with the Work of the Contractor, who shall cooperate with them. The Contractor shall participate with the Owner and Others in reviewing their construction schedules when directed to do so. The Contractor shall make any revisions to the schedule of the Work, Contract Time and Contract Price deemed necessary after a joint review and mutual agreement. The construction schedules shall then constitute the schedules to be used by the Contractor, separate contractors and the Owner until subsequently revised.

3.2.3 With regard to the work of the Owner and Others, the Contractor shall (a) proceed with the Work in a manner which does not hinder, delay or interfere with the work of the Owner or Others or cause the work of the Owner or Others to become defective, (b) afford the Owner or Others a reasonable opportunity for introduction and storage of their materials and equipment and performance of their activities, and (c) connect and coordinate the Contractor’s construction and operations with theirs as required by the Contract Documents.

3.2.4 Before proceeding with any portion of the Work affected by the construction or operations of the Owner or Others, the Contractor shall give the Owner prompt, written notification of any defects the contractor discovers in their work which will prevent the proper execution of the Contractor’s Work. The Contractor’s obligations in this paragraph do not create a responsibility for the work of Others, but are for the purpose of facilitating the Contractor’s Work. If the Contractor does not notify the Owner of patent defects interfering with the performance of the Work, the Contractor acknowledges that the work of the Owner or Others is not defective and is acceptable for the proper execution of the Contractor’s Work.

3.3 RESPONSIBILITY FOR CONTRACT DOCUMENTS

3.3.1 In order to facilitate its responsibilities for completion of the Work in accordance with and as reasonably inferable from the Contract Documents, prior to commencing the Work the Contractor shall examine and compare: the Contract Documents; information furnished by the Owner pursuant to Paragraph 4.3; relevant field measurements made by the Contractor; and any visible conditions at the site affecting the Work.

3.3.2 If in the course of the performance of the obligations in Subparagraph 3.3.1 the Contractor discovers any errors, omissions or inconsistencies in the Contract Documents, the Contractor shall promptly report them to the Owner. It is recognized, however, that the Contractor is not acting in the capacity of a licensed design professional, and that the Contractor’s examination is to facilitate construction and does not create an affirmative responsibility to detect errors, omissions or inconsistencies or to ascertain compliance with applicable laws, building codes or regulations.

3.3.3 The Contractor has no liability for errors, omissions or inconsistencies described in Subparagraphs 3.3.1 and 3.3.2 unless the Contractor knowingly failed to report a recognized problem to the Owner. If, however, the Contractor fails to perform the examination and reporting obligations of these provisions, the Contractor shall be responsible for any avoidable costs or direct damages.

3.3.4 The Contractor may be entitled to additional costs and/or time because of clarifications or instructions growing out of the Contractor’s reports described in the three preceding subparagraphs.

3.4 CONSTRUCTION PERSONNEL AND SUPERVISION

3.4.1 The Contractor shall provide a competent level of supervision for the performance of the Work at the Project,

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including a Contractor’s Representative who shall possess full authority to receive instructions from Owner and to act on those instructions.

3.4.2 Before beginning performance of the Work, Contractor shall notify Owner in writing of the name and qualifications of its proposed superintendent (or foreman) so Owner may review the individual’s qualifications. If, for reasonable cause, the Owner refuses to approve the individual, or withdraws its approval after once giving it, Contractor shall name a different superintendent for Owner’s review. Any disapproved superintendent will not perform in that capacity thereafter at the Owner’s Worksite.

3.4.3 As between the Owner and Contractor, the Contractor shall be responsible to the Owner for acts or omissions of parties or entities performing portions of the Work for or on behalf of the Contractor or any of its Subcontractors.

3.4.4 Contractor shall permit only fit and skilled persons to perform the Work. Contractor shall enforce safety procedures, strict discipline and good order among persons performing the Work. If Owner determines that a particular person does not follow safety procedures, or is unfit or unskilled for the assigned work, Contractor shall immediately reassign the person on receipt of Owner’s written notice to do so.

3.5 WORKMANSHIP

3.5.1 Every part of the Work shall be executed in accordance with the Contract Documents and submittals approved pursuant to paragraph 3.13 in a workerlike manner. All materials used in the Work shall be furnished in sufficient quantities to facilitate the proper and expeditious execution of the Work and shall be new except such materials as may be expressly provided in the Contract Documents to be otherwise.

3.6 MATERIALS FURNISHED BY THE OWNER OR OTHERS

3.6.1 In the event the scope of the Work includes installation of materials or equipment furnished by the Owner or Others, it shall be the responsibility of the Contractor to examine the items so provided and thereupon handle, store and install the items, unless otherwise provided in the Contract Documents, with such skill and care as to provide a satisfactory and proper installation. Loss or damage due to acts or omissions of the Contractor shall be the responsibility of the Contractor and may be deducted from any amounts due or to become due the Contractor.

3.7 TESTS AND INSPECTIONS

3.7.1 The Contractor shall schedule all required tests, approvals and inspections of the Work or portions thereof at appropriate times so as not to delay the progress of the Work or other work related to the Project. The Contractor shall give proper written notice to all required parties of such tests, approvals and inspections. The Owner and Others may observe the tests promptly at the normal place of testing if feasible. The Owner shall bear all expenses associated with tests, inspections and approvals required by the Contract Documents which, unless otherwise agreed to, shall be conducted by an independent testing laboratory or entity approved by the Owner. Unless otherwise required by the Contract Documents, required certificates of testing approval or inspection shall be secured by the Contractor and promptly delivered to the Owner.

3.7.2 If the Owner or appropriate authorities determine that testing, inspection or approval in addition to those required by the Contract Documents will be necessary, the Contractor shall arrange for the procedures and give timely notice to the Owner and Others who may observe the procedures. Costs of the additional tests, inspections or approvals are at the Owner’s expense except as provided in Subparagraph 3.7.3.

3.7.3 If the procedures described in Subparagraphs 3.7.1 and 3.7.2 indicate that portions of the Work fail to comply with the Contract Documents, the Contractor shall be responsible for costs of correction and retesting.

3.8 WARRANTY

3.8.1 The Contractor warrants to the Owner that to the extent consistence with the standards of care and diligence normally practiced by construction contractors in performing Work of a similar nature and to the extent either required or permitted by the Contract Documents, materials used and equipment furnished shall be new and of good quality. At the Owner’s request, the Contractor shall furnish satisfactory evidence of the quality and type of materials and equipment furnished. The Contractor further warrants that the Work will be free from material defects not intrinsic to the design or materials required in the Contract Documents. The Contractor’s warranty does not include remedies for defects or damages caused by normal wear and tear during normal usage, use for a purpose for which the Project was not intended, improper or insufficient maintenance, modifications performed by the Owner or Others, or abuse.

3.8.2 If within one year after the date of Substantial Completion of the Work as defined in Subparagraph 2.3.15, any Work is found to be defective as defined in Subparagraph 2.3.6, Paragraph 3.5, and Subparagraph 3.8.1 above, the Owner shall promptly notify the Contractor in writing. Unless the Owner provides written acceptance of the condition, the Contractor shall promptly correct the Defective Work. If within the one-year correction period the Owner discovers and does not promptly notify the Contractor or give the Contractor an opportunity to test and/or correct Defective Work as reasonably requested by the Contractor, the Owner waives the Contractor’s obligation to correct that Defective Work as well as the Owner’s right to claim a breach of the warranty with respect to that Defective Work.

3.8.3 With respect to any portion of Work first performed after Substantial Completion, the warranty period of one year shall be extended by the period of time between Substantial Completion and the actual performance of the Work. Correction periods shall not be extended by corrective work performed by the Contractor.

3.8.4 The Contractor shall obtain from its Subcontractors and Suppliers any special or extended warranties required by the Contract documents. Contractor’s liability for such warranties shall be limited to the one year correction period referred to in Subparagraph 3.8.2. After that period Contractor shall assign them to the Owner and provide reasonable assistance to the Owner in enforcing the obligations of Subcontractors or suppliers.

3.8.5 If after the one-year correction period but before the applicable limitation period the Owner discovers any Defective Work, the Owner shall, unless the Defective Work requires emergency correction, promptly notify the Contractor. The Owner may either (a) allow the Contractor at its option to correct the Work or (b) have the Work corrected by itself or Others and charge the Contractor for the reasonable cost of the correction.

3.8.6 If the Contractor fails to correct Defective Work within a reasonable time after receipt of written notice from the Owner, the Owner may correct it in accordance with the Owner’s right to

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carry out the Work in Paragraph 11.2. In such case, an appropriate Change Document shall be issued deducting the cost of correcting such deficiencies from payments then or thereafter due the Contractor. If payments then or thereafter due Contractor are not sufficient to cover such amounts, the Contractor shall pay the difference to the Owner.

3.8.7 If the Contractor’s correction or removal of Defective Work causes damage to or destroys other completed or partially completed construction, the Contractor shall be responsible for the cost of correcting the destroyed or damaged construction. The Owner shall be responsible for the cost of correcting damaged or destroyed, completed or partially completed construction, when the damage or destruction is caused by the Owner or Others.

3.8.8 The one-year period for correction of Defective Work does not affect a limitation period with respect to the enforcement of the Contractor’s other obligations under the Contract Documents.

3.8.9 At the Owner’s option and with the Contractor’s agreement, the Owner may elect to accept Defective Work rather than require its removal and correction. In such case the Contract Price shall be equitably adjusted, whether or not the Owner has made final payment.

3.9 CORRECTION OF COVERED WORK

3.9.1 On request of the Owner, Work which has been covered without a requirement that it be inspected prior to being covered may be uncovered for the Owner’s inspection. The Owner shall pay for the costs of uncovering and replacement if the Work proves to be in conformance with the Contract Documents, or if the defective condition was caused by the Owner or Others. If the uncovered Work proves to be defective, the Contractor shall pay the costs of uncovering and replacement.

3.9.2 If contrary to specific requirements in the Contract Documents or contrary to a specific request from the Owner, a portion of the Work is covered, the Owner, by written request, may require the Contractor to uncover the Work for the Owner’s observation. In this circumstance the Work shall be replaced at the Contractor’s expense and with no adjustment to the Contract Time.

3.9.3 The Contractor is required to correct in a timely fashion any Work rejected by the Owner which fails to comply with the Contract Documents prior to the commencement of the warranty period(s) or during the warranty period(s) established under Paragraph 3.8. The Contractor shall correct at its own cost and time and bear the expense of additional services for any Defective Work for which it is responsible.

3.10 SAFETY OF PERSONS AND PROPERTY

3.10.1 SAFETY PRECAUTIONS AND PROGRAMS The Contractor shall have overall responsibility for safety precautions and programs in the performance of the Work. While the provisions of this Paragraph establish the responsibility for safety between the Owner and Contractor, they do not relieve Subcontractors of their responsibility for the safety of persons or property in the performance for their work, nor for compliance with the provisions of applicable laws and regulations.

3.10.2 The Contractor shall seek to avoid injury, loss or damage to persons or property by taking reasonable steps to protect:

.1 employees and other persons at the site;

.2 materials and equipment stored at on-site or off-site locations for use in performance of the Work; and

.3 the Project and all property located at the site and adjacent to work areas, whether or not said property or structures are part of the Project or involved in the Work.

3.10.3 CONTRACTOR’S SAFETY REPRESENTATIVE The Contractor shall designate an individual at the site in the employ of the Contractor who shall act as the Contractor’s designated safety representative with a duty to prevent accidents. Unless otherwise identified by the Contractor in writing to the Owner, the designated safety representative shall be the Contractor’s project superintendent. The Contractor will report immediately in writing all accidents and injuries occurring at the Worksite to the Owner. When the Contractor is required to file an accident report with a public authority, the Contractor shall furnish a copy of the report to the Owner.

3.10.4 The Contractor shall provide the Owner with copies of all notices required of Contractor by law or regulation. The Contractor’s safety program shall comply with the requirements of governmental and quasi-governmental authorities having jurisdiction.

3.10.5 Damage or loss not insured under property insurance which may arise from the performance of the Work, to the extent of the negligence attributed to such acts or omissions of the Contractor, or anyone for whose acts the Contractor may be liable, shall be promptly remedied by the Contractor. Damage or loss attributable to the acts or omissions of the Owner or Others and not to the Contractor shall be promptly remedied by the Owner.

3.10.6 If the Owner deems any part of the Work or Worksite unsafe, the Owner, without assuming responsibility for the Contractor’s safety program, may require the Contractor to stop performance of the Work or take corrective measures satisfactory to the Owner, or both. If the Contractor does not adopt corrective measures, the Owner may perform them and deduct their cost from the Contract Price. The Contractor agrees to make no claim for damages, for an increase in the Contract Price, or for a change in the Contract Time based on the Contractor’s compliance with the Owner’s reasonable request.

3.11 HAZARDOUS MATERIALS

3.11.1 A Hazardous Material is any substance or material identified now or in the future as hazardous under any federal, state or local law or regulation, or any other substance material which may be considered hazardous or otherwise subject to statutory or regulatory requirement governing handling, disposal and/or clean-up. The Contractor shall not be obligated to commence or continue work until any Hazardous Material discovered at the project site has been removed, rendered or determined to be harmless by the Owner as certified by an independent testing laboratory and approved by the appropriate government agency.

3.11.2 If after the commencement of the Work, Hazardous Material is discovered at the project site, the Contractor shall be entitled to immediately stop Work in the affected area. The Contractor shall report the condition to the Owner and, if required, the government agency with jurisdiction.

3.11.3 The Contractor shall not be required to perform any work relating to or in the area of Hazardous Material without written mutual agreement.

3.11.4 The Owner shall be responsible for retaining an independent testing laboratory to determine the nature of the material

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encountered and whether it is a Hazardous Material requiring corrective measures and/or remedial action. Such measures shall be the sole responsibility of the Owner, and shall be performed in a manner minimizing any adverse effects upon the work of the Contractor. The Contractor shall resume Work in the area affected by any Hazardous Material only upon written agreement between the parties after the Hazardous Material has been removed or rendered harmless and only after approval, if necessary, of the governmental agency with jurisdiction.

3.11.5 If the Contractor incurs additional costs and/or is delayed due to the presence or remediation of Hazardous Material, the Contractor shall be entitled to an equitable adjustment in the Contract Price and/or the Contract Time.

3.11.6 To the extent not caused by the negligent acts or omissions of the Contractor, its Subcontractors and subsubcontractors, and the agents, officers, directors and employees of each of them, the Owner shall defend, indemnify and hold harmless the Contractor, its Subcontractors and sub- subcontractors, and the agents, officers, directors and employees of each of them, from and against any and all direct claims, damages, losses, costs and expenses, including but not limited to attorney’s fees, costs and expenses incurred in connection with any dispute resolution process, arising out of or relating to the performance of the Work in any area affected by Hazardous Material. To the fullest extent permitted by law, such indemnification shall apply regardless of the fault, negligence, breach of warranty or contract, or strict liability of the Owner.

3.11.7 Material Safety Data (MSD) sheets as required by law and pertaining to materials or substances used or consumed in the performance of the Work, whether obtained by the Contractor, Subcontractors, the Owner or Others, shall be maintained at the Site by the Contractor and made available to the Owner, Subcontractors and Others.

3.11.8 During the Contractor’s performance of the Work, the Contractor shall be responsible for the proper handling of all materials brought to the site by the Contractor. Once the Owner takes possession of the Worksite, the Owner shall be responsible under this Paragraph for materials and substances brought to the site by the Contractor if such materials or substances were required by the Contract Documents.

3.11.9 The terms of this Paragraph shall survive the completion of the Work under this Contract and/or any termination of this Contract.

3.12 EMERGENCIES

3.12.1 The Contractor shall act as it deems appropriate in an emergency situation threatening personal injury or property damage. An equitable adjustment in compensation and/or time may be determined in a Change Document.

3.13 SUBMITTALS

3.13.1 The Contractor shall submit to the Owner for review and approval all shop drawings, samples, product data, and similar submittals required by the Contract Documents. The Contractor shall be responsible to the Owner for the accuracy and conformity of its submittals to the Contract Documents. The Contractor shall prepare and deliver its submittals to the Owner in a manner consistent with the Project Schedule and in such time and sequence so as not to delay the performance of the Work or the work of the Owner and Others. The review and approval of any Contractor submittal shall not be deemed to authorize deviations, substitutions or changes in the requirements of the Contact Documents unless express written approval is obtained from the Owner specifically authorizing such deviation, substitution or change. In the event that the Contract Documents do not contain submittal requirements pertaining to the Work, the Contractor agrees upon request to submit in a timely fashion to the Owner for review and approval by the Owner any shop drawings, samples, product data, manufacturers’ literature or similar submittals as may reasonably be required by the Owner.

3.13.2 The Owner shall be responsible for review and approval of submittals with reasonable promptness to avoid causing delay.

3.13.3 The Contractor shall perform all Work strictly in accordance with approved submittals. Approval of shop drawings is not authorization to Contractor to perform Extra Work or Changed Work, unless the procedures of Article 8 are followed. The Owner’s approval does not relieve the Contractor from responsibility for Defective Work resulting from errors or omissions of any kind on the approved Shop Drawings.

3.13.4 Current record copies incorporating field changes and selections made during construction of the following are to be maintained at the Project site and available to the Owner upon request: drawings, specifications, addenda, Change Document and other modifications, and required submittals including product data, samples and shop drawings.

3.13.5 No substitutions shall be made in the Work unless permitted in the Contract Documents and then only after the Contractor obtains all approvals required under the Contract Documents for substitutions.

3.14 PROFESSIONAL SERVICES The Owner, through its Designer, shall provide all professional services required for the completion of the Work. The Contractor shall not be required to provide professional services which constitute the practice of architecture or engineering unless the Contractor needs to provide such services in order to carry out its responsibilities for construction means and methods. The Contractor shall not be required to provide such services in violation of existing taws, rules and regulations in the jurisdiction where the Project is located.

3.15 SITE CONDITIONS

3.15.1 PRE-BID SITE VISIT The Contractor acknowledges that it has visited, or has had the opportunity to visit, the Project site to visually inspect the general and local conditions which could affect the Work.

3.15.2 POST-CONTRACT FIELD CONDITIONS The Contractor shall compare its field measurements and observations with the Contract Documents and any other information before commencing the Work. The Contractor shall promptly report any recognized errors, inconsistencies or omissions to the Owner. If the Contractor fails to report to the Owner any recognized errors, inconsistencies or omissions, the Contractor shall be liable to the Owner for damages resulting therefrom.

3.15.3 CONCEALED OR UNKNOWN SITE CONDITIONS If the conditions at the site are (a) subsurface or other physical conditions which are materially different from those indicated in the Contract Documents, or (b) unusual or unknown physical conditions which are materially different from conditions ordinarily encountered and generally recognized as inherent in Work provided for in the Contract Documents, then prompt notice shall be given to all affected parties before the conditions are disturbed, but in no event later than seven (7) days after discovery. If appropriate, an equitable adjustment to the Contract Price and Contract Time shall be made by Change Document. If agreement cannot be reached by the parties, the party seeking an adjustment in the Contract Price or

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Contract Time may assert a Claim in accordance with the Contract Documents.

3.16 PERMITS AND TAXES

3.16.1 Contractor shall give public authorities all notices required by law and, except for permits and fees which are the responsibility of the Owner pursuant to Paragraph 4.4, shall obtain and pay for all necessary permits, licenses and renewals pertaining to the Work. The entire cost of obtaining all necessary notices, permits, licenses and renewals is included in the Contract Price. Contractor will provide to Owner copies of all notices, permits, licenses and renewals required under this Contract.

3.16.2 Contractor shall pay all applicable taxes legally enacted when bids are received or negotiations concluded for the Work provided by the Contractor.

3.16.3 The Contractor shall be compensated for additional costs resulting from laws, ordinances, rules, regulations and taxes enacted after the date of this Agreement.

3.16.4 If in accordance with the Owner’s direction an exemption is claimed for taxes, the Owner agrees to defend, indemnify and hold the Contractor harmless from any liability, penalty, interest, fine, tax assessment, attorneys fees or other expense or cost incurred by the Contractor as a result of any action taken by the Contractor in accordance with the Owner’s direction.

3.17 CUTTING, FITTING AND PATCHING

3.17.1 The Contractor shall ensure the performance of all cutting, fitting and patching required to coordinate the various parts of the Work and to prepare its Work for the work of the Owner or Others by the Contract Documents.

3.17.2 Cutting, patching, or altering the Work or the work of the Owner or Others shall be done with the prior written approval of the Owner and the consent of the Contractor or Others as appropriate. Such consent shall not be unreasonably withheld.

3.18 CLEANING UP

3.18.1 The Contractor shall at all times during its performance of the Work keep the Worksite clean and free from debris resulting from the Work. Prior to discontinuing Work in an area, the Contractor shall clean the area and remove all rubbish and its construction equipment, tools, machinery, waste and surplus materials. Contractor shall make provisions to minimize and confine dust and debris resulting from construction activities.

3.18.2 If the Contractor fails to immediately commence compliance with cleanup duties within forty-eight (48) hours after written notification from the Owner of non-compliance, the Owner may implement appropriate cleanup measures without further notice and the cost thereof shall be deducted from any amounts due or to become due the Contractor.

3.19 ACCESS TO WORK The Contractor shall facilitate the access of the Owner and Others to Work in progress.

3.20 CONFIDENTIALITY Contractor agrees that it will treat as confidential information and not disclose to third persons or use for its own benefit any of Owner’s developments, confidential information, know-how, discoveries, production methods and the like that may be disclosed to Contractor or which Contractor may acquire in connection with the Work.

3.20.1 Any drawings, plans, specifications, analyses, proposals, reports, photographs, models or other information, data or documents proprietary to the Owner but not relating to the Contractor’s means, methods, techniques or processes (whether in raw, preliminary or final form) which are developed by the Contractor while performing Work under this Agreement belong to the Owner and are Owner’s confidential information.

ARTICLE 4

OWNER’S RESPONSIBILITIES

4.1 INFORMATION AND SERVICES Any information or services to be provided by the Owner shall be provided in a timely manner.

4.2 FINANCIAL INFORMATION Prior to commencement of the Work and thereafter at the written request of the Contractor, the Owner shall provide the Contractor with evidence of Project financing. Evidence of such financing shall be a condition precedent to the Contractor’s commencing or continuing the Work. The Contractor shall be notified prior to any material change in Projects financing.

4.3 SITE INFORMATION Except to the extent that the Contractor knows of any inaccuracy, the Contractor is entitled to rely on the following site information to be furnished at the Owner’s expense and with reasonable promptness.

.1 information describing the physical characteristics of the site, including surveys, site evaluations, legal descriptions, data or drawings depicting existing conditions, subsurface and environmental studies, reports and investigations;

.2 structural, mechanical, chemical, air and water pollution tests, tests for hazardous materials, and other laboratory and environmental tests, inspections and reports required by law; and

.3 any other information or services requested in writing by the Contractor which is relevant to the Contractor’s performance of the Work and under the Owner’s control.

The surveys and legal information shall include, as applicable, grades and lines of streets, alleys, pavements and adjoining property and structures; adjacent drainage; rights-of-way, restrictions, easements, encroachments, zoning, deed restrictions, boundaries and contours of the site; locations, dimensions and necessary data pertaining to existing buildings, other improvements and trees; and information concerning available utility services and lines, both public and private, above and below grade, including inverts and depths. All information on the survey shall be referenced to a project benchmark.

4.4 BUILDING PERMIT, FEES AND APPROVALS Except for those permits and fees related to the Work which are the responsibility of the Contractor pursuant to Paragraph 3.16, the Owner shall secure and pay for all other permits, approvals, easements, assessments and fees required for the development, construction, use or occupancy of permanent structures or for permanent changes in existing facilities, including the building permit.

4.5 MECHANICS LIEN INFORMATION Within seven (7) days after receiving the Contractor’s written request, the Owner shall provide the Contractor with the information necessary to give notice of or enforce mechanics lien rights and where applicable stop notices. This information shall include the Owner’s interest in the

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real property on which the Project is located and the record legal title.

4.6 CONTRACT DOCUMENTS Unless otherwise specified, Owner shall provide a reasonable number of the Contract Documents to the Contractor without cost.

4.7 OWNER’S REPRESENTATIVE The Owner’s representative is Tim Smith, Construction Manager for Siouxland Ethanol, LLC.

The representative or the representative’s designee:

.1 shall be fully acquainted with the Project;

.2 agrees to furnish the information and services required of the Owner pursuant to Paragraph 4.3 so as not to delay the Contractor’s Work; and

.3 shall have authority to bind the Owner in all matters requiring the Owner’s approval, authorization or written notice.

If the Owner changes its representative or the representative’s authority as listed above, the Owner shall immediately notify the Contractor in writing.

4.8 STOPPING THE WORK If the Contractor is continually negligent in its performance of the Work in accordance with the Contract Documents or fails to correct Defective Work as required in Paragraph 3.8, the Owner may order the Contractor in writing to stop the Work or any portion of the Work until such negligent performance or failure is rectified. The Owner’s right to stop the Work, however, does not create a responsibility to do so except in an emergency or in the mitigation of damages.

4.9 CUTTING AND PATCHING As described in Subparagraph 3.17.2, the Owner and Others have the same responsibility for cutting, patching, or altering the Work as the Contractor.

4.10 OWNER’S RIGHT TO CLEAN UP In case of a dispute between the Contractor and Others with regard to respective responsibilities for cleaning up at the site, the Owner may implement appropriate cleanup measures and apportionately allocate the cost among those responsible.

ARTICLE 5

SUBCONTRACTS

5.1 SUBCONTRACTORS The Work not performed by the Contractor with its own forces shall be performed by Subcontractors.

5.2 AWARD OF SUBCONTRACTS AND OTHER CONTRACTS FOR PORTIONS OF THE WORK

5.2.1 As soon after the award of the Contract as possible the Contractor shall provide the Owner with a written list of the proposed Subcontractors and significant material suppliers. If the Owner has a reasonable objection to any proposed Subcontractor or material supplier, the Owner shall notify the Contractor in writing. Failure to promptly object shall constitute acceptance.

5.2.2 If the Owner has reasonably and promptly objected as provided in Subparagraph 5.2.1, the Contractor shall not contract with proposed Subcontractor or material supplier, and the Contractor shall propose another acceptable to the Owner. An appropriate Change Document shall reflect any increase or decrease in the Contract Price or Contract Time required by the substitution.

5.3 BINDING OF SUBCONTRACTORS AND MATERIAL SUPPLIERS The Contractor agrees to bind every Subcontractor and material supplier (and require every Subcontractor to so bind its subcontractors and material suppliers) to all the provisions of this Agreement and the Contract Documents as they apply to the Subcontractor’s and material supplier’s portions of the Work.

5.4 LABOR RELATIONS

Contractor shall conduct his operations without any disruptions to other work operations on the project site. Contractor shall be solely responsible for his own labor relations.

5.5 CONTINGENT ASSIGNMENT OF SUBCONTRACTS

5.5.1 If this Agreement is terminated, each subcontract agreement is assigned by the Contractor to the Owner, subject to the prior rights of any surety provided that:

.1 the Contract is terminated by the Owner pursuant to Paragraphs 11.3 or 11.4; and

.2 the Owner accepts such assignment after termination by notifying the Subcontractor and Contractor in writing.

5.5.2 If the Owner accepts such an assignment, and the Work has been suspended for more than thirty (30) consecutive days, the Subcontractor’s compensation shall be equitably adjusted as a result of the suspension.

ARTICLE 6

CONTRACT TIME

6.1 PERFORMANCE OF THE WORK

6.1.1 DATE OF COMMENCEMENT The Date of Commencement is the effective date of this Agreement as first written in Article 2 unless otherwise set forth below:

Contractor shall mobilize the jobsite and commence work by No later than 9/20/06.

6.1.2 TIME Substantial Completion of the Work shall be as follows subject to adjustments provided for in the contract documents. Complete all work by 12/15/06.

6.1.3 Time limits stated in the Contract Documents are of the essence.

6.1.4 Unless instructed by the Owner in writing, the Contractor shall not knowingly commence the Work before the effective date of insurance that is required to be provided by the Contractor or the Owner.

6.2 OWNER’S RIGHT TO DETERMINE THE ORDER OF CONTRACTOR’S ACTIVITIES

6.2.1 Before submitting the first application for payment, the Contractor shall submit to the Owner a progress construction schedule document which will specify the dates on which the Contractor plans to begin and complete various parts of the Work, including dates on which information and approvals are required from the Owner. On the Owner’s written approval of the schedule,

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the Contractor shall comply with it unless directed by the Owner to do otherwise. The Contractor will update the schedule on a monthly basis or at appropriate intervals as required by the conditions of the Work and the Project.

6.2.2 The Owner may determine the sequence in which the Work is performed, provided it does not unreasonably interfere with the approved project schedule. The Owner may require the Contractor to make reasonable changes in the sequence at any time during the performance of the Work in order to facilitate the performance of work by the Owner or Others. To the extent such changes increase Contractor’s time and costs the Contract Price and Contract Time shall be equitably adjusted including a reasonable overhead and profit resulting from the change in sequence.

6.2.3 The Owner, for any reason, may require the Contractor at any time to perform any portion of the Work on an overtime basis or may require the Contractor not to perform any portion of the Work on an overtime basis. If the Owner requires overtime Work, the overtime portion will be considered Extra Work, provided the Owner exercised its right to accelerate the scheduled completion date or to promote the Owner’s interests. Overtime Work required to enable the Contractor to meet a scheduled completion date or to correct Defective Work is not Extra Work. The Contract Price, the Contract Time or both will be increased or changed under Article 8 for all overtime Work constituting Extra Work. In no event will an increase in the Contract Price be greater than an amount equal to the additional costs incurred by the Contractor as a result of the overtime Work (i.e., the overtime premium portion of the applicable wage rates plus the payroll taxes, insurance, and overhead and profit applicable to the overtime premium portion of the applicable wage rates).

6.3 DELAYS AND EXTENSIONS OF TIME

6.3.1 The Contract Time shall be equitably extended by Change Document if the Contractor is delayed at any time in the commencement or the progress of the Work by any justifiable cause beyond the Contractor’s control including but not limited to any of the following: an act or omission of the Owner or Others; changes ordered in the Work, including multiple changes issued in a short period of time whose cumulative impact may cause delay; labor disputes; fire; hazardous materials; adverse weather conditions not reasonably anticipated; concealed or unknown conditions; or delay authorized by the Owner pending dispute resolution.

6.3.2 In the event delays to the Work are encountered for any reason, the Owner and Contractor agree to undertake reasonable steps to mitigate the effect of such delays. Subject to the provisions of Article 12, if either party is entitled to additional costs as a result of such mitigation, they shall be recoverable.

6.4 DELAY CLAIMS Subject to the provisions of Articles 8 and 12, if the Contractor is entitled to recover additional costs incurred and/or to have an adjustment in the Contract Time as a result of events set forth in Subparagraph 6.3.1, those costs shall be recoverable and an equitable time extension granted. Subject to Paragraph 10.2, to the extent the Contractor causes delay in the completion of the Work, the Owner shall be entitled to recover its additional costs following the procedures established in Article 12.

ARTICLE 7

CONTRACT PRICE

7.1 LUMP SUM As full compensation for performance by the Contractor of this Agreement, the Owner agrees to pay the Contractor the lump sum price of $810,366.00 Eight hundred ten thousand three hundred sixty six dollars and no cents subject to additions and deductions as provided for in this Agreement. The lump sum price is hereinafter referred to as the Contract Price.

7.2 ADJUSTMENTS The Contract Price is subject to increase or decrease solely as provided in Article 8. The Contract Price, including authorized adjustments, is the total amount payable by the Owner to the Contractor for performance of the Work under the Contract Documents.

7.3 ALLOWANCES

7.3.1 All allowances stated in the Contract Documents shall be included in the Contract Price. While the Owner may direct the amounts of and particular suppliers for specific allowance items, if the Contractor reasonably objects to a supplier, it cannot be required to contract with them. The Owner shall select allowance items in a timely manner so as not to delay the Work.

7.3.2 Allowances shall include the costs of materials and equipment delivered to the site less applicable trade discounts and including requisite taxes, unloading and handling at the Project site, and labor and installation. The Contractor’s overhead and profit for the allowances shall be included in the Contract Price, but not in the allowances. The Contract Price shall be adjusted by Change Document to reflect the actual

ARTICLE 8

CHANGES

8.1 CHANGE DOCUMENTS

8.1.1 The Owner, without invalidating the Contract, may order changes in the Work within the general scope of the Contract consisting of additions, deletions or other revisions, the Contract Price and the Contract Time being adjusted accordingly. All such changes in the Work shall be authorized by applicable Change Document, and shall be performed under the applicable conditions of the Contract Documents. The Owner and Contractor shall negotiate in good faith an appropriate adjustment to the Contract Price and Contract Time and shall conclude these negotiations as expeditiously as possible. Acceptance of the Change Document and any adjustment in the Contract Price or the Contract Time shall not be unreasonably withheld.

8.1.2 A Change Document is a written order signed by the Owner and the Contractor after execution of this Agreement, indicating changes in the Work and substitutions proposed by the Contractor and accepted by the Owner within the general scope of the Agreement. All such changes in the Work shall be performed under the applicable conditions of the Contract Documents. The Contract Price and the Contract Time may be modified only by Change Document. A Change Document signed by the Contractor indicates agreement therewith, including the adjustment in the Contract Price or the Contract Time.

8.2 COST OR CREDIT DETERMINATION

8.2.1 The cost or credit to the Owner resulting from a change in the Work shall be determined in one or more of the following ways:

.1 by mutual acceptance of an itemized lump sum;

.2 by unit prices as indicated in the Contract Documents or as subsequently agreed to by the parties;

.3 by costs determined in a manner acceptable to the

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     parties and a mutually acceptable fixed or percentage fee; or

     .4 by the method provided below.

If none of the methods set forth above is agreed upon, or if the proposed work must be expedited, the Contractor, provided it receives from the Owner a written order to proceed with a representation that a Change Document will be promptly signed by the Owner, shall promptly proceed with the Work involved. Absent an agreement to one of the above methods, the cost of such Work shall then be determined on the basis of reasonable expenditures and savings of those performing the Work attributable to the change, including, in case of an increase in the Contract Price, a reasonable allowance for overhead and profit. The Contractor shall keep and present, in such form as the Owner may prescribe, an itemized accounting together with appropriate supporting data for inclusion in a Change Document. Unless otherwise provided in the Contract Documents, costs shall be limited to the following: cost of materials, supplies and equipment, including sales tax and cost of delivery; costs of labor, including employee benefits, social security, retirement, unemployment, and workers compensation insurance required by law, agreement or under Contractor’s standard personnel policy; bond and insurance premiums; rental value of equipment and machinery; costs of field office personnel and supervision; and fees and taxes related to the change. Pending final determination of cost to the Owner, interim Change Documents shall be issued each month for costs incurred in the past month. Payments on account for such costs shall be made on the Certificate of Payment, and the Contract Price shall be increased accordingly.

8.2.2 Adjustments shall be based on net change in Contractor’s reasonable cost of performing the changed Work plus, in the case of a net increase in cost, an agreed upon Fee not to exceed Ten percent (10 %). For purposes of determining such adjustment, the allowable cost of equipment rental for any Extra Work, if a lump sum is not agreed on, shall be subject to guidelines established by the Owner and set forth in Paragraph 13.9.

8.3 UNIT PRICES If unit prices are indicated in the Contract Documents or are subsequently agreed to by the parties, but the character or quantity of such unit items as originally contemplated is so different in a proposed Change Document that the original unit prices will cause substantial inequity to the Owner or the Contractor, such unit prices shall be equitably adjusted.

8.4 PERFORMANCE OF CHANGED WORK The Contractor shall not be obligated to perform Changed Work until a Change Document has been executed by the Owner and Contractor.

ARTICLE 9

(a) PAYMENT

9.1 SCHEDULE OF VALUES

9.1.1 Within twenty-one (21) calendar days from the date of execution of this Agreement, the Contractor shall prepare and submit to the Owner a Schedule of Values apportioned to the various divisions or phases of the Work. Each line item contained in the Schedule of Values shall be assigned a monetary price such that the total of alt such items shall equal the Contract Price.

9.2 PROGRESS PAYMENTS

9.2.1 APPLICATIONS The Contractor shall submit to the Owner a Monthly application for payment no later than: the 25^th day of the month Subcontractor’s applications for payment shall be itemized and supported by the Contractor’s Schedule of Values and any other substantiating data as required by this Agreement. Payment applications may include payment requests on account of properly authorized interim Change Documents. The Owner shall pay the amount otherwise due on any payment application, less any amounts as set forth below, no later than twenty (20) calendar days after the Contractor has submitted a complete and accurate payment application. The Owner may deduct, from any progress payment, such amounts as may be retained pursuant to Subparagraph 9.2.4 below.

9.2.2 STORED MATERIALS AND EQUIPMENT If approved by the Owner, applications for payment may include materials and equipment not incorporated into the Work but delivered to and suitably stored on-site, or off-site and applicable insurance, storage and transportation costs to the site. Approval of payment applications for stored materials and equipment shall be conditioned on submission by the Contractor of bills of sale and proof of applicable insurance, or such other procedures satisfactory to the Owner to establish the proper valuation of the stored materials and equipment, the Owner’s title to such materials and equipment, and to otherwise protect the Owner’s interests therein, including transportation to the site

9.2.3 PARTIAL LIEN WAIVERS AND AFFIDAVITS As a prerequisite for payment, the Contractor shall provide, if requested by the Owner, partial lien and claim waivers in the amount of the application for payment and affidavits from its subcontractors, materialmen and suppliers for the completed Work. Such waivers may be conditional upon payment. In no event shall the Contractor be required to sign an unconditional waiver of lien or claim, either partial or final, prior to receiving payment or in an amount in excess of what it has been paid.

9.2.4 RETAINAGE From each progress payment made prior to the time Substantial Completion of the Work has been reached, the Owner shall retain ten percent (10 %), of the amount otherwise due after deduction of any amounts as provided in Paragraph 9.3 of this Agreement.

.1 at the time the Work is fifty percent (50%) complete and thereafter, the Owner shall withhold no more retainage and pay the Contractor the full amount of what is due on account of progress payments;

.2 once each early finishing trade contractor has completed its work and that work has been accepted by the Owner, the Owner may release final retention on such Work;

.3 the Owner may, in its sole discretion, reduce the amount to be retained at any time.

9.3 ADJUSTMENT OF CONTRACTOR’S PAYMENT APPLICATION The Owner may adjust or reject a Contractor payment application or nullify a previously approved Contractor payment application, in whole or in part, as may reasonably be necessary to protect the Owner from loss or damage based upon the following, to the extent that the Contractor is responsible therefor under this Agreement:

.1 the Contractor’s repeated failure to perform the Work as required by the Contract Documents;

.2 loss or damage arising out of or relating to this Agreement and caused by Contractor to the Owner, or others to whom the Owner may be liable;

.3 the Contractor’s failure to properly pay Subcontractors for labor, materials, equipment or supplies

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     furnished in connection with the Work;

     .4 nonconforming or Defective Work not corrected in a timely fashion;

     .5 reasonable evidence of delay in performance of the Work such that the Work will not be completed within the Contract Time, and that the unpaid balance of the Contract Price is not sufficient to offset any direct damages that may be sustained by the Owner as a result of the anticipated delay caused by the Contractor; and

     .6 reasonable evidence demonstrating that the unpaid balance of the Contract Price is insufficient to fund the
cost to complete the Work.

The Owner shall give written notice to the Contractor at the time of disapproving or nullifying an application for payment of the specific reasons therefor. When the above reasons for disapproving or nullifying an application for payment are removed, payment will be made for the amounts previously withheld.

9.4 RESPONSIBILITY FOR LIENS If Owner has made payments in the time required by this Article 9, the Contractor shall , within thirty (30) days after filing, cause the removal of any liens filed against the premises or public improvement fund by any party or parties performing labor or services or supplying materials in connection with the Work. If the Contractor fails to take such action on a lien, the Owner may cause the lien to be removed at the Contractor’s expense, including bond costs and reasonable attorney’s fees. This Paragraph shall not apply if there is a dispute pursuant to Article 12 relating to the subject matter of the lien.disapproving or nullifying an application for payment of the specific reasons therefor. When the above reasons for disapproving or nullifying an application for payment are removed, payment will be made for the amounts previously withheld.

9.5 ACCEPTANCE OF WORK Neither the Owner’s payment of progress payments nor its partial or full use or occupancy of the Project constitutes acceptance of Work not complying with the Contract Documents.

9.6 PAYMENT DELAY If for any reason not the fault of the Contractor, the Contractor does not receive a progress payment from the Owner within seven (7) calendar days after the time such payment is due, as defined in Subparagraph 9.2.1, then the Contractor, upon giving seven (7) calendar days’ written notice to the Owner, and without prejudice to and in addition to any other legal remedies, may stop Work until payment of the full amount owing to the Contractor has been received. The Contract Price and Contract Time shall be equitably adjusted by a Change Document if reasonable cost and delay resulting from shutdown, delay and start-up are incurred by the Contractor.

9.7 SUBSTANTIAL COMPLETION

9.7.1 The Contractor shall notify the Owner when it considers the Substantial Completion of the Work or a portion thereof to have been achieved. The Owner shall promptly conduct an inspection to determine whether the Work or designated portion thereof can be occupied or utilized for its intended use by the Owner without excessive interference by the Contractor in completing any remaining unfinished Work. If the Owner determines that the Work or designated portion thereof has not reached Substantial Completion, the Owner shall promptly compile a list of items to be completed or corrected so the Owner may occupy or utilize the Work or designated portion thereof for its intended use. The Contractor shall promptly complete all items on the list.

9.7.2 When Substantial Completion of the Work or a designated portion thereof is achieved, the Contractor shall prepare a Certificate of Substantial Completion which shall establish the date of Substantial Completion, recommending the respective responsibilities of the Owner and Contractor for interim items such as security, maintenance, utilities, insurance, and damage to the Work, and fixing the time for completion of all items on the list accompanying the Certificate. The Certificate of Substantial Completion shall be submitted by the Contractor to the Owner for written acceptance of responsibilities assigned in the Certificate.

9.7.3 Unless otherwise provided in the Certificate of Substantial Completion, warranties required by the Contract Documents shall commence on the date of Substantial Completion of the Work or a designated portion.

9.7.4 Upon acceptance by the Owner of the Certificate of Substantial Completion, the Owner shall pay to the Contractor the remaining retainage held by the Owner for the Work described in the Certificate of Substantial Completion less a sum equal to two hundred percent (200%) of the estimated cost of completing or correcting remaining items on that part of the Work, as agreed to by the Owner and Contractor as necessary to achieve final completion.

9.8 PARTIAL OCCUPANCY OR USE

9.8.1 The Owner may occupy or use completed or partially completed portions of the Work when (a) the portion of the Work is designated in a Certificate of Substantial Completion, (b) appropriate insurer(s) consent to the occupancy or use, and (c) appropriate public authorities authorize the occupancy or use. Such partial occupancy or use shall constitute Substantial Completion of that portion of the Work. The Contractor shall not unreasonably withhold consent to partial occupancy or use. Owner shall not unreasonably refuse to accept partial occupancy.

9.9 FINAL PAYMENT

9.9.1 Upon notification from the Contractor that the Work is complete and ready for final inspection and acceptance the Owner will promptly conduct an inspection to determine if the Work has been completed and is acceptable under the Contract Documents. Uncompleted items shall be completed by the Contractor in a mutually agreed time frame. The Owner shall pay the Contractor monthly the amount retained for unfinished items as each item is completed.

9.9.2 When final completion has been achieved, the Contractor shall prepare for the Owner’s acceptance a final application for payment staling that to the best of the Contractor’s knowledge, and based on the Owner’s inspections, the Work has reached final completion in accordance with the terms and conditions of the Contract Documents.

9.9.3 Final payment of the balance of the Contract Price shall be made to the Contractor within twenty (20) days after the Contractor has submitted a complete and accurate application for final payment.

9.9.4 Final payment and any retained amounts shall be due on the Contractor’s submission of the following to the Owner:

.1 an affidavit declaring any indebtedness connected with the Work, e.g. payrolls or invoices for materials or equipment, to have been paid, satisfied or to be paid with the proceeds of final payment, so as not to encumber the Owner’s property;

.2 as-built drawings, manuals, copies of warranties and all other close out documents required by the Contract Documents;

.3 release of any liens, conditioned on final payment being received;

.4 consent of any surety; and

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.5 a report of any accidents or injuries experienced by the Contractor or its Subcontractors at the Worksite.

9.9.5 If after Substantial Completion of the Work, the final completion of a portion of the Work is materially delayed through no fault of the Contractor, the Owner shall pay the balance due for portion(s) of the Work fully completed and accepted. If the remaining contract balance for Work not fully completed and accepted is less than the retained amount prior to payment, the Contractor shall submit to the Owner the written consent of any surety to payment of the balance due for portions of the Work that are fully completed and accepted. Such payment shall not constitute a waiver of claims, but otherwise shall be governed by these final payment provisions.

9.9.6 Final payment shall constitute a waiver of Claims by the Owner except those arising from:

.1 unsettled liens, claims, security interests or encumbrances arising out of the contract;

.2 failure of the Work to comply with the requirements of the Contract Documents;

.3 terms of warranties required by the Contract Documents; or

.4 latent defects.

9.9.7 ACCEPTANCE OF FINAL PAYMENT Unless the Contractor, Subcontractor or material supplier provides written identification of unsettled claims with an application for final payment, their acceptance of final payment constitutes a waiver of such claims.

9.10 LATE PAYMENT Payments due pursuant to Subparagraph 9.2.1, less any amount retained pursuant to Subparagraphs 9.2.4 and 9.7.4, and Paragraph 9.9 may bear interest from the date payment is due at the prime rate prevailing at the place of the Project.

ARTICLE 10

INDEMNITY, INSURANCE AND WAIVERS

10.1 INDEMNITY

10.1.1 To the fullest extent permitted by law, the Contractor shall defend, indemnify and hold the Owner and Others harmless from all claims for bodily injury and property damage, other than to the Work itself and other property insured under Paragraph 10.3.4, that may arise from the performance of the Work to the extent of the negligence attributed to such acts or omissions by the Contractor, Subcontractors or anyone employed directly or indirectly by any of them or by anyone for whose acts any of them may be liable. The Contractor shall not be required to defend, indemnify or hold harmless the Owner or Others for any acts, omissions or negligence of the Owner or Others.

10.1.2 The Owner shall cause any other contractor who may have a contract with the Owner to perform work in the areas where Work will be performed under this Agreement to agree to indemnify the Contractor, Subcontractors or anyone employed directly or indirectly by any of them or anyone for whose acts any of them may be liable and hold them harmless from all claims for bodily injury and property damage, other than property insured under Paragraph 10.3.4, that may arise from that contractor’s operations. Such provisions shall be in a form satisfactory to the Contractor.

10.2 MUTUAL WAIVER OF CONSEQUENTIAL DAMAGES The Contractor and Owner waive all claims against each other for all consequential damages arising out of or relating to this Contract. This mutual waiver includes:

.1 damages incurred by the Owner for rental expenses for losses of use, income, profit, financing, business and reputation, and for loss of management or employee productivity or of the services of such persons; and

.2 damages incurred by the Contractor for principal office expenses including the compensation of personnel stationed there, for losses of financing, business and reputation, and for loss of profit other than anticipated profits arising directly from this Project

This mutual waiver is applicable, without limitation, to ail consequential damages due to either party’s termination in accordance with Article 11. Nothing contained in this Subparagraph shall be deemed to preclude an award of liquidated direct damages, if applicable in accordance with the requirements of the Contract Documents.

10.3 INSURANCE

10.3.1 Prior to the start of Work, the Contractor shall procure and maintain in force Workers’ Compensation Insurance, Employer’s Liability Insurance, Business Automobile Liability Insurance, and Commercial General Liability Insurance (CGL). The CGL policy shall include coverage for liability arising from premises, operations, independent contractors, products- completed operations, personal injury and advertising injury, contractual liability, and broad form property damage. The CGL will also name the Owner as an additional insured for liability arising out of the Contractor’s Work.

The Contractor’s Employer’s Liability, Business Auto Liability, and Commercial General Liability policies, as required in this Subparagraph 10.3.1, shall be written with limits of liability not less than the following:

Employer’s Liability	$1,000,000.00
	Bodily Injury by Accident
	$1,000,000 – Policy Limit.
	Bodily Injury by Disease
Business Auto Liability	$1,000,000.00
	Each Accident
Commercial General Liability	$1,000,000.00
	Each Occurrence
	$2,000,000.00
	General Aggregate
	$2,000,000.00
	Products/Completed
	Operations Aggregate
	$1,000,000.00
	Personal and Advertising Injury Limit

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10.3.2 Employer’s Liability, Business Auto Liability and Commercial General Liability coverages required under Subparagraph 10.3.1 may be arranged under a single policy for the full limits required or by a combination of underlying policies with the balance provided by Excess and/or Umbrella Liability policies.

10.3.3 The Contractor shall maintain in effect all insurance coverage required under Subparagraph 10.3.1 at the Contractor’s sole expense with insurance companies lawfully authorized to do business in the jurisdiction in which the Project is located. If the Contractor fails to obtain or maintain any insurance coverage required under this Agreement, the Owner may purchase such coverage and charge the expense thereof to the Contractor, or terminate this Contract.

The policies of insurance required under Subparagraph 10.3.1 shall contain a provision that the coverages afforded under the policies will not be cancelled or allowed to expire until at least thirty days prior written notice has been given to the Owner. The Contractor shall maintain completed operations liability insurance for one year after acceptance of the Work, substantial completion of the Project, or to the time required by the Contract Documents, whichever is longer. The Contractor shall furnish the Owner evidence of such insurance at the time of completion of the Work.

Prior to commencement of the Work, Contractor and Owner will furnish each other with reasonably acceptable certificate or certificates of insurance.

10.3.4 The Owner shall be solely responsible for all risk of physical loss or damage to the entire Project including portions of the Work stored off-site, Work in transit, scaffolding, falsework, temporary buildings located at the Project, and tenant improvements. Before the start of Work, the Owner shall obtain and maintain property insurance upon the entire Project for the full cost of replacement at the time of loss. This insurance shall list as named insureds the Owner, Contractor, Subcontractors and Subsubcontractors. This insurance shall be written as a Builder’s Risk, “all risk” or equivalent form to cover all risks or physical loss except those specifically excluded by the policy, and shall insure at least against the perils of fire, lightning, explosion, windstorm, and hail, smoke, aircraft (except aircraft, including helicopter, operated by or on behalf of Contractor) and vehicles, riot and civil commotion, theft, vandalism, malicious mischief, debris removal, flood, earthquake, earth movement, water damage, wind, testing if applicable, collapse however caused, and damage resulting from defective design, workmanship or material. The Owner shall be solely responsible for any deductible amounts or coinsurance penalties.

This insurance shall remain in effect until final payment has been made or until no person or entity other than the Owner has an insurable interest in the property to be covered by this insurance, whichever is sooner. Partial occupancy or use of the Work shall not commence until the Owner has secured the consent of the insurance company or companies providing the coverage required in this Subparagraph 10.3.4.

Upon written request of the Contractor, the Owner will provide a copy of the property policy or policies obtained in compliance with this Subparagraph 10.3.4.

10.3.5 If the Owner does not intend to purchase the property insurance required by this Agreement including all of the coverages and deductibles described herein, the Owner shall give written notice to the Contractor before the Work is commenced. The Contractor may then provide insurance to protect its interests and the interests of the Subcontractors and Subsubcontractors in the Work including the coverage of deductibles. The cost of this insurance shall be charged to the Owner in a Change Document. The Owner shall be responsible for all of Contractor’s costs reasonably attributed to the Owner’s failure or neglect in purchasing or maintaining the coverage described above.

10.3.6 Owner and Contractor waive all rights against each other and their perspective employees, agents, contractors, subcontractors and subsubcontractors for damages caused by risks covered by the property insurance in Subparagraph 10.3.4, except such rights as they may have to the proceeds of such insurance and such rights the Contractor may have for the failure of the Owner to obtain and maintain property insurance in compliance with Subparagraph 10.3.4. To the extent of the limits of Contractor’s Commercial General Liability Insurance specified in Subparagraph 10.3.1 or two million dollars ($ 2,000,000 ) whichever is more, the Contractor shall indemnify and hold harmless the Owner against any and all liability, claims, demands, damages, losses and expenses, including attorney’s fees, in connection with or arising out of any damage or alleged damage to any of Owner’s existing adjacent property that may arise from the performance of the anyone employed directly or indirectly by any of them or by anyone for whose acts any of them may be liable.

10.3.7 BUSINESS INCOME INSURANCE The Owner, at the Owner’s option, may purchase and maintain such insurance as will insure the Owner against loss of use of the Owner’s property due to fire or other hazards, however caused. The Owner waives all rights of action against the Contractor for loss of use of the Owner’s property, including consequential losses due to fire or other hazards however caused.

10.3.8 OWNER’S LIABILITY The Owner shall obtain and maintain its own liability insurance for protection against claims arising out of the performance of this Agreement, including without limitation, loss of use and claims, losses and expenses arising out of the Owner’s errors or omissions.

10.4 ROYALTIES, PATENTS AND COPYRIGHTS The Contractor shall pay all royalties and license fees which may be due on the inclusion of any patented or copyrighted materials, methods or systems selected by the Contractor and incorporated in the Work. The Contractor shall defend, indemnify and hold the Owner harmless from all suits or claims for infringement of any patent rights or copyrights arising out of such selection. The Owner agrees to defend, indemnify and hold the Contractor harmless from any suits or claims of infringement of any patent rights arising out of any patented materials, methods or systems specified by the Owner.

ARTICLE 11

TERMINATION OF THE AGREEMENT,
SUSPENSION AND NOTICE TO CURE

11.1 SUSPENSION BY OWNER FOR CONVENIENCE

11.1.1 OWNER SUSPENSION Should the Owner order the Contractor in writing to suspend, delay, or interrupt the performance of this Agreement or any part which affects the Work for such period of time as may be determined to be appropriate for the convenience of the Owner and not due to any act or omission of the Contractor or any other person or entity for whose acts or omissions the Contractor may be liable, then the Contractor shall immediately suspend, delay or interrupt that portion of the Work as ordered by the Owner.

11.1.1.1 ADJUSTMENTS The Contract Price and the Contract Time shall be equitably adjusted for the cost and delay resulting from any such suspension, including any increases in the cost of materials, equipment, construction equipment, labor and a reasonable overhead and profit on such increase.

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11.1.2 Any action taken by the Owner which is permitted by any other provision of the Contract Documents and which results in a suspension of part or all of the Work, does not constitute a suspension of Work under this Article.

11.2 NOTICE TO CURE If the Contractor refuses or fails to supply enough properly skilled workers, proper materials, and/or equipment, to maintain the approved project schedule in accordance with Article 6, or it fails to make prompt payment to its workers, subcontractors or suppliers, disregards laws, ordinances, rules, regulations or orders of any public authority having jurisdiction, or is otherwise guilty of a material breach of a provision of this Agreement the Contractor may be deemed in default of this Agreement. If the Contractor fails within seven (7) working days after written notification to commence and continue satisfactory correction of such default, with diligence and promptness, then the Owner without prejudice to any other rights or remedies may:

.1 supply such number of workers and quantity of materials, equipment and other facilities as the Owner deems necessary for the satisfactory correction of such default, which the Contractor has failed to complete or perform after the aforesaid notice, and charge the cost thereof to the Contractor, who shall be liable for the payment of same including reasonable overhead, profit and attorneys’ fees;

.2 contract with one or more additional trade contractors, to perform such part of the Work as the Owner shall determine will provide the most expeditious correction of the default and charge the cost thereof to the Contractor;

.3 withhold payment of moneys due the Contractor in accordance with Paragraph 9.3 of this Agreement; and

.4 in the event of an emergency affecting the safety of persons or property, the Owner may immediately commence and continue satisfactory correction of such default per (.1) or (.2) above, without first giving written notice to the Contractor, but shall then give prompt written notice of such action to the Contractor.

11.3 OWNER’S RIGHT TO TERMINATE FOR CAUSE

11.3.1 TERMINATION BY OWNER FOR CAUSE If the Contractor fails to commence and satisfactorily continue correction of a default within seven (7) working days after the written notification issued under Paragraph 11.2, or provide the Owner with written verification of positive action that is in process, then the Owner may, in lieu of or in addition to the remedies set forth in Paragraph 11.2, issue a second written notification to the Contractor. Such notice shall state that if the Contractor fails to commence and continue correction of the default within fourteen (14) working days of the second written notification, this Agreement may be terminated. The Owner also may furnish materials, equipment, appliances or tools and employ such workers or trade contractors as the Owner deems necessary to maintain the orderly progress of the Work. A written notice of termination shall be issued by the Owner to the Contractor at the time this Agreement is terminated.

All costs incurred by the Owner in performing the Work, including attorney’s fees, shall be deducted from any moneys due or to become due the Contractor under this Agreement. The Contractor shall be liable for the payment of any amount by which such expense may exceed the unpaid balance of the Contract Price. If the unpaid balance of the Contract Price for Work performed in accordance with this Agreement exceeds the expense of finishing the Work, Contractor shall be paid for Work performed in accordance with the Contract Documents up to the amount that the unpaid contract balance exceeds the expense of finishing the Work.

Upon request of the Contractor the Owner shall furnish to the Contractor a detailed accounting of the costs incurred by the Owner in finishing the Work.

11.3.2 USE OF CONTRACTOR’S EQUIPMENT If the Owner performs work under this Paragraph 11.3, or subcontracts such work to be so performed, the Owner shall have the right to take and use any materials, implements, equipment, appliances or tools furnished by, belonging or delivered to the Contractor and located at the Project for the purpose of completing any remaining Work. Immediately upon completion of the Work, any remaining materials, implements, equipment, appliances or tools not consumed or incorporated in performance of the Work, and furnished by, belonging to, or delivered to the Project by or on behalf of the Contractor, shall be returned to the Contractor in substantially the same condition as when they were taken, reasonable wear and tear excepted.

11.3.3 If the Contractor files a petition under the Bankruptcy Code, this Agreement shall terminate if the Contractor or the Contractor’s trustee rejects the Agreement or, if there has been a default, the Contractor is unable to give adequate assurance that the Contractor will perform as required by this Agreement or otherwise is unable to comply with the requirements for assuming this Agreement under the applicable provisions of the Bankruptcy Code.

11.4 TERMINATION BY OWNER FOR CONVENIENCE Upon written notice to the Contractor, the Owner may, without cause, terminate this Agreement with the Contractor. The Contractor shall immediately stop the Work, follow the Owner’s instructions regarding shutdown and termination procedures, and strive to mitigate all costs.

11.4.1 ADJUSTMENTS If the Work is so terminated, the Contractor may recover from the Owner payment for all Work performed in accordance with this Agreement, all costs from the termination, plus a reasonable profit.

11.4.2 If the Owner terminates this Contract pursuant to Paragraphs 11.3 or 11.4, the Contractor shall:

.1 execute and deliver to the Owner alt papers and take all action required to assign, transfer and vest in the Owner the rights of the Contractor to all Materials and Supplies for which payment has or will be made in accordance with the Contract Documents and alt subcontracts, orders and commitments which have been made in accordance with the Contract Documents;

.2 exert every effort to reduce to a minimum the Owner’s liability for subcontracts, orders and commitments which have not been fulfilled at the time of the termination;

.3 cancel any subcontracts, orders and commitments as the Owner directs; and

.4 sell at prices approved by the Owner any Materials and Supplies as the Owner directs with all proceeds paid or credited to the Owner as Owner directs.

11.5 CONTRACTOR’S RIGHT TO TERMINATE

11.5.1 Upon seven (7) days’ written notice to the Owner, the Contractor may terminate this Agreement if the Work has been stopped for a thirty (30) day period through no fault of the Contractor for any of the following reasons:

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.1 under court order or order of other governmental authorities having jurisdiction;

.2 as a result of the declaration of a national emergency or other governmental act during which, through no act or fault of the Contractor, materials are not available; or

.3 suspension by Owner for convenience pursuant to Paragraph 11.1.

11.5.2 The Contractor may terminate the Agreement for any of the following reasons:

.1 if the Owner fails to furnish reasonable evidence that sufficient funds are available and committed for the entire cost of the Project in accordance with Paragraph 4.2 of this Agreement, or

.2 if the Owner assigns this Agreement over the Contractor’s reasonable objection,

.3 if the Owner fails to pay the Contractor in accordance with this Agreement and the Contractor has complied with Paragraph 9.6,

.4 if the Owner otherwise materially breaches this Agreement.

11.5.3 Upon termination by the Contractor in accordance with Paragraph 11.5, the Contractor shall be entitled to recover from the Owner payment for all Work executed and for any proven loss, cost or expense in connection with the Work, plus all demobilization costs and reasonable damages plus a reasonable profit.

11.6 OBLIGATIONS ARISING BEFORE TERMINATION Even after termination pursuant to Article 11, the provisions of this Agreement still apply to any Work performed, payments made, events occurring, costs charged or incurred or obligations arising before the termination date.

ARTICLE 12

DISPUTE RESOLUTION

12.1 WORK CONTINUANCE AND PAYMENT Unless otherwise agreed in writing, the Contractor shall continue the Work and maintain the approved schedules during any dispute resolution proceedings. If the Contractor continues to perform, the Owner shall continue to make payments in accordance with the Agreement.

12.2 INITIAL DISPUTE RESOLUTION If a dispute arises out of or relates to this Agreement or its breach, the parties shall endeavor to settle the dispute first through direct discussions. If the dispute cannot be settled through direct discussions, the parties shall endeavor to settle the dispute by mediation under the Construction Industry Mediation Rules of the American Arbitration Association before recourse to the dispute resolution procedures contained in this Agreement. Once one party files a request for mediation with the other contracting party and with the American Arbitration Association, the parties agree to conclude such mediation within sixty (60) days of filing of the request. Either party may terminate the mediation at any time after the first session, but the decision to terminate must be delivered in person by the party’s representative to the other party’s representative and the mediator.

12.3 EXHIBIT NO. 1 If the dispute cannot be settled by mediation within sixty (60) days, the parties shall submit the dispute to any dispute resolution process set forth in Exhibit No. 1 to this Agreement.

12.4 MULTIPARTY PROCEEDING The parties agree that all parties necessary to resolve a claim shall be parties to the same dispute resolution proceeding. Appropriate provisions shall be included in all other contracts relating to the Work to provide for the consolidation of such dispute resolution procedures.

12.5 COST OF DISPUTE RESOLUTION The prevailing party in any dispute arising out of or relating to this Agreement or its breach that is resolved by the dispute resolution process set forth in Exhibit No. 1 to this Agreement shall be entitled to recover from the other party reasonable attorneys fees, costs and expenses incurred by the prevailing party in connection with such dispute resolution process.

12.6 LIEN RIGHTS Nothing in this Article shall limit any rights or remedies not expressly waived by the Contractor which the Contractor may have under lien laws.

ARTICLE 13

MISCELLANEOUS PROVISIONS

13.1 ASSIGNMENT Neither the Owner nor the Contractor shall assign their interest in this Agreement without the written consent of the other except as to the assignment of proceed. The Owner and Contractor respectively bind themselves, their partners, successors, assigns and legal representatives to the other party hereto and to partners, successors, assigns and legal representatives of such other party in respect to covenants, agreements and obligations contained in the Contract Documents. Neither party to this Agreement shall assign the Contract as a whole without written consent of the other except that the Owner may assign the Contract to a wholly owned subsidiary of Owner when Owner has fully indemnified Contractor or to an institutional lender providing construction financing for the Project as long as the assignment is no less favorable to the Contractor than this Agreement. The Contractor shall execute all consents reasonably required to facilitate such assignment. In such event, the wholly owned subsidiary or lender shall assume the Owner’s rights and obligations under the Contract Documents. However, if the Contractor has a reasonable objection to such assignment, it shall have the right to terminate this Agreement as provided in Subparagraph 11.5.2.2. If either party attempts to make such an assignment, that party shall nevertheless remain legally responsible for all obligations under the Contract, unless otherwise agreed by the other party.

13.2 GOVERNING LAW This Agreement shall be governed by the law in effect at the location of the Project.

13.3 SEVERABILITY The partial or complete invalidity of any one or more provisions of this Agreement shall not affect the validity or continuing force and effect of any other provision.

13.4 NO WAIVER OF PERFORMANCE The failure of either party to insist, in any one or more instances, on the performance of any of the terms, covenants or conditions of this Agreement, or to exercise any of its rights, shall not be construed as a waiver or relinquishment of such term, covenant, condition or right with respect to further performance.

13.5 TITLES AND GROUPINGS The title given to the Articles of this Agreement are for ease of reference only and shall not be relied upon or cited for any other purpose. The grouping of the articles in this Agreement and of the Owner’s specifications under the various headings is solely for the purpose of convenient organization and in no event will the grouping of provisions, the use of paragraphs or the use of headings be construed to limit or alter the meaning of any provisions.

13.6 JOINT DRAFTING The parties hereto expressly agree that

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this Agreement was jointly drafted, and that they both had opportunity to negotiate its terms and to obtain the assistance of counsel in reviewing its terms prior to execution. Therefore, this Agreement shall be construed neither against nor in favor of either party, but shall be construed in a neutral manner.

13.7 RIGHTS AND REMEDIES The parties’ rights, liabilities, responsibilities and remedies with respect to this Agreement, whether in contract, tort, negligence or otherwise shall be exclusively those expressly set forth in this Agreement.

13.7.1 The parties agree to look solely to each other with respect to the performance of this Agreement. This Agreement and each and every provision hereof is for the exclusive benefit of Owner and Contractor and not for the benefit of any third party, and no third party shall be entitled to rely upon or enforce the terms of this Agreement, or to be a third party beneficiary thereof, except to the extent expressly provided in this Agreement.

13.8 PRECEDENCE If any provision of this Agreement conflicts with or is inconsistent with any other provision of other Contract Documents, the provision of this Agreement governs, unless the other provision specifically refers to the provision it supersedes and replaces in this Agreement.

13.9 OTHER PROVISIONS

ARTICLE 14

CONTRACT DOCUMENTS

14.1 The Contract Documents in existence at the time of execution of this Agreement are as follows:

.1 Fagen Engineering Drawings Sheet Numbers 212 through 223, Sheet Numbers 228 and 229

.2 Fagen Engineering Drawings:

     Dwg # 616- Natural Gas Plan

     Dwg # 634- Methane Gas Line

.3 Fagen Engineering Site Civil Package Specification Manual

.4 Fagen Engineering Specification 15050

.5 SLE Revised Bid Form

.6 SLE Instructions to Bidders

.7 SLE Bid Addendum #1 Dated 8/25/06

.8 Fagen Inc. Safety and Health Handbook

14.2 INTERPRETATION OF CONTRACT DOCUMENTS

14.2.1 The Owner’s drawings and specifications are complementary. If Work is shown only on one but not on the other, the Contractor shall perform the Work as though fully described on both consistent with the Contract Documents and reasonably inferable from them as being necessary to produce the indicated results.

14.2.2 In case of conflicts between the Owner’s drawings and specifications, the specifications govern. In any case of omissions or errors in figures, drawings or specifications, the Contractor shall immediately submit the matter to the Owner for clarification. The Owner’s clarifications are final and binding on all parties subject to an equitable adjustment in Contract Time or Price pursuant to Article 8.

14.2.3 Where figures or memoranda are given, they will be preferred to scale dimensions.

14.2.4 Any terms which have well-known technical or trade meanings, unless otherwise specifically defined in the Contract Documents, will be interpreted in accordance with their well-known meanings.

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This Agreement is entered into as of the date entered in Article 1.

	OWNER: Siouxland Ethanol, LLC
ATTEST:	BY:
	PRINT NAME: Tom Lynch
	PRINT TITLE: President of the Board
ATTEST:	CONTRACTOR:
	BY:
	PRINT NAME:
	PRINT TITLE:

(i) Exhibit No.l, dated                                         ,

AGC DOCUMENT NO. 200 STANDARD FORM OF AGREEMENT AND GENERAL CONDITIONS BETWEEN OWNER AND CONTRACTOR
(Where the Contract Price is a Lump Sum)
1997, The Associated General Contractors of America

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STANDARD FORM OF AGREEMENT AND GENERAL
CONDITIONS BETWEEN OWNER AND CONTRACTOR
(Where the Contract Price is a Lump Sum)

DISPUTE RESOLUTION MENU

Pursuant to Subparagraph 12.3, if neither direct discussions nor mediation successfully resolve the Claim, the parties agree the following shall be used to resolve the Claim.

(Check the appropriate selection(s). These procedures can be used singularly, or progressively as agreed to by the parties.)

o Dispute Review Board The Dispute Review Board is composed of one member selected by the Owner, one selected by the Contractor, and a third member selected by the two Owner and Contractor selected members. This Board shall be selected by the time construction commences, shall meet periodically, and shall make advisory decisions which may be introduced into evidence at any subsequent dispute resolution process. If a Dispute Review Board is selected, it is understood its review will precede mediation.

o Advisory Arbitration Advisory Arbitration shall be pursuant to the Construction Industry Rules of the American Arbitration Association.

o Mini Trial Each party, in the presence of top management, shall submit its position to a mutually selected individual who shall make a non-binding recommendation to the parties. Such advisory decision may be introduced into evidence at any subsequent dispute resolution process.

þ Binding Arbitration Binding Arbitration shall be pursuant to the Construction Industry Rules of the American Arbitration Association unless the parties mutually agree otherwise. A written demand for arbitration shall be filed with the American Arbitration Association and the other party to the Agreement within a reasonable time after the dispute or claim has arisen, but in no event after the applicable statute of limitations for a legal or equitable proceeding would have run. The location of the arbitration proceedings shall be at the office of the American Arbitration Association nearest the Project site, unless the parties agree otherwise. The arbitration award shall be final. Notwithstanding Paragraph 13.2, this agreement to arbitrate shall be governed by the Federal Arbitration Act and judgment upon the award may be confirmed in any court having jurisdiction.

o Litigation Action may be filed in the appropriate state or federal court located in the jurisdiction in which the Project is located.

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EX-10.21

Exhibit 10.21

	U.S. Water Services/Utility Chemicals 330 South Cleveland St. Cambridge, MN 55008 Tel: (763) 689-3636
	Fax: (763) 689-3660

Date: 9/15/06

SERVICES AND EQUIPMENT QUOTED TO:

          Siouxland Ethanol

          Attn: Tim Smith

          P.O. Box 411

          Jackson                     NE                     68743

U.S. Water Services Equipment and Services Agreement

The undersigned Purchaser hereby instructs U.S. Water Services to proceed with the equipment order described with the understanding that the Terms and Conditions shown on Pages 2 and 3, and are hereby incorporated as part of this Equipment Agreement. The Purchaser further understands that all quotes or estimates, if any, are based on the best information available prior to beginning work. As the scope of work, conditions, or estimated quantities change revised quotations or estimates will not be issued unless requested. All prices are subject to Federal, State and Local Sales and Use Taxes.

     Work Location:            Siouxland Ethanol — Jackson, NE           

     Work Order #:                                                             

QNTY.	DESCRIPTION	ARO			COST
1	USWaterWorks Communication Package	8 weeks			$	13,265.00
1	BlueFalcon Automation	8 weeks			$	4,500.00
7	Stainless Steel Tanks With Sight Glass, Venting Kit, Fill Line	8 weeks			$	22,400.00
1	110 Gal. PE Tank for Non-Oxidizing Biocide	8 weeks			$	750.00
2	1,000 Gal. Tank for Chlorine	8 weeks			$	7,800.00
1	Low-Voltage & Communication Wiring Termination/ Supervision	4 weeks			$	2,000.00
2	Microfiltration Units	16 weeks			$	1,040,000.00
1	USW-300 Reverse Osmosis, With CIP Tank and Pump	16 weeks			$	255,900.00
1	USW-300 Reverse Osmosis, With CIP Tank and Pump	16 weeks			$	255,900.00
1	USW-450 Triplex: Triplex Progressive Flow Water Softener	14 weeks			$	47,083.00
1	PK-12941: Pretreatment Chemical Feed System	6 weeks			$	1,436.00
1	PK-12921: Reverse Osmosis Polymer, Bisulfite, Acid Feed	10 weeks			$	34,168.23
1	Initial Chemical Fill Precleaning Chemicals Testing Equipment RO Prefilters RO CIP Chemical Transfer Pumps	8 weeks			$	63,154.14
	SUB TOTAL				$	1,748,356.37
	CAPITAL EQUIPMENT DISCOUNT		5	%	$	84,160.11
	TOTAL				$	1,664,196.26
	Does the customer agree to allow USWS to purchase and charge up to $5000.00 worth of miscellaneous construction expenses? All expenses will be reconciled at the close of construction.	Yes   6			$	5,000.00

NOTE: All equipment or engineering has been completed by the engineering design firm. Further, NPDES restriction will not be known until some future date and could impact additional equipment and costs. Not all parts of the water systems are included in this proposal and there are sure to be miscellaneous parts and pieces as the project continues through the design and construction phase. It is recommended that the customer budget at least $20,000 for miscellaneous parts and pieces.

     Assumes 3-Year Service Agreement.

CONFIDENTIAL

	U.S. Water Services/Utility Chemicals 330 South Cleveland St. Cambridge, MN 55008
	Tel: (763) 689-3636 Fax: (763) 689-3660

Terms & Conditions

The undersigned Purchaser hereby instructs U.S. Water Services to proceed with the equipment order described with the understanding that the Terms and Conditions shown on Pages 2 and 3, and are hereby incorporated as part of this Equipment Agreement. The Purchaser further understands that all quotes or estimates, if any, are based on the best information available prior to beginning work. As the scope of work, conditions, or estimated quantities change revised quotations or estimates will not be issued unless requested. All prices are subject to Federal, State and Local Sales and Use Taxes.

• The equipment and chemicals were based upon a water quality from samples obtained by the customer and tested by U.S. Water Services. The water results are dependant upon obtaining a representative water sample and that water sample being a stable water quality. Well water quality may change dramatically from test wells. The wells may produce sand or other contaminants not known during initial well testing or the well may be impacted by surface water conditions or the geology in the area over time. These water changes may increase operating costs for chemicals and may require additional capital to provide the necessary water quality to the ethanol plant. Necessary water quality is defined as a “Silt Density Index” of less than 5.0 for the water process equipment, such as the Reverse Osmosis, and of potable water quality for the ethanol process. Additional costs due to these unknown well or makeup water changes shall be the responsibility of the customer.

• Changing water sources could and probably will create the need to add additional capital water treatment equipment and could increase chemical and operating costs.

• Discharge restrictions are usually not known in advance and the NPDES permit is not usually issued prior to the water system engineering process. Many times there are limits or restrictions that may create the need to add additional water treatment equipment or change the operating assumptions on which the chemical and service agreement was based. The chemical and services were selected based on those conditions outlined in Appendix A. U.S. Water Services has no way of knowing in advance of these types of specific restrictions that may be imposed by regulatory agencies. U.S. Water Services has no ability to alter or impact NPDES restrictions. Additional costs due to these unknown restrictions or limitations shall be the responsibility of the customer.

• The ethanol design firm has overall authority in the system and process design. This equipment and chemical agreement is based upon the initial design specifications, which are based on the current design and construction standards from the engineering design firm. These design specifications are outlined in Appendix A. U.S. Water has no control over design changes made by the engineering design firm or the contracted construction firm. It is common for changes to occur. Additional costs incurred due to system design changes, plant layout changes, addition of equipment or systems specified by the design or construction firm, safety additions and/or process improvements shall be the responsibility of the customer.

LIABILITY: U.S. Water Services shall not be liable for any bodily injury, death, or injury to or destruction of tangible property except as the same may have been caused by the negligence of U.S. Water Services. In no event shall U.S. Water Services be liable for any delays of special, indirect, incidental or consequential damages. Purchaser agrees that the total limit of U.S. Water Services’s liability (whether based on negligence, warranty, ??? liability or otherwise) hereunder, shall not exceed the aggregate amount due U.S. Water Services for services rendered under this contract. All claims, including claims for negligence or any other cause whatsoever, shall be deemed waived unless made in writing and received by U.S. Water Services within one (1) year after U.S. Water Services’s completion of work hereunder.

PRICE ADJUSTMENT: Any cost estimates or time frames stated herein are subject to equitable adjustment in the event of differing or unforeseeable conditions, changes in applicable laws after the date of this contract, unforeseeable delays or difficulties caused by acts of God, Purchaser or any third parties. Prices of goods acquired by U.S. Water Services from others shall be adjusted to reflect U.S. Water Services’s price in effect at time of shipment. The price of U.S. Water Services’s goods will be adjusted to the price in effect at time of shipment in accordance with U.S. Water Services’s current escalation policies or as specifically covered in this contract.

TERMS: Payment Payment terms shall be 50% upon order, 40% upon shipment and 10% upon start up or 90 days from shipment whichever is shorter. For extended projects, U.S. Water Services shall submit invoices on a monthly basis for any and all work completed and materials or equipment provide during the previous month. Past due invoices shall be subject to a delinquency charge of one and one-half percent (1-1/2%) per month (eighteen percent (18%) per annum) unless a lower charge is required under applicable law, in which case the lower rate shall apply. Purchaser agrees to pay all collection fees, attorneys’ fees and cost incurred in the collection of any past due amounts arising out of this contract. U.S. Water Services shall have the right to immediately terminate this contract without further liability if Purchaser fails to make timely payment or otherwise materially breaches this contract.

CONFIDENTIAL

	U.S. Water Services/Utility Chemicals 330 South Cleveland St. Cambridge, MN 55008
	Tel: (763) 689-3636 Fax: (763) 689-3660

GUARANTEE AND LIABILITY: U.S. Water Services warrants that its labor supplied hereunder shall be free from defect and shall conform to the standard of care in effect in its industry at the time of performance of such labor for a period of twelve (12) months after substantial completion of U.S. Water Services’s work. U.S. Water Services agrees, to the extent it is permitted, to pass on any warranties provided by the manufactures of materials and/or equipment furnished under this contract. U.S. Water Services itself provides no warranty, express, implied or otherwise, on any such materials or equipment.

TITLE AND OWNERSHIP: In case of default of Purchaser’s part, U.S. Water Services shall have the right to enter the premises upon which any material or equipment furnished herein have been installed and retake such goods not then paid for and pursue any further remedy provided by law, including recovery of attorneys’ fees and any deficiency to the maximum extent and in the manner provide by law. Such materials and equipment shall retain their character as personal property of U.S. Water Services until payment in full is received by U.S. Water Services, regardless of their mode of attachment. Unless prior specific written instructions are received to the contrary, surplus and replaced materials and equipment resulting from repair or installation work shall become the property of U.S. Water Services.

DELIVERY: Shipment schedules and dates, expressed or implied, are contingent on normal conditions. U.S. Water Services will not be responsible fc any delays in shipment or completion caused by factors beyond its control such as, but not limited to, suppliers’ failures, accidents, work stoppages or operation of or changes in the law.

PURCHASER		U.S. WATER SERVICES
By:	/s/ Tom Lynch	By:
Printed:	Tom Lynch	Printed:	Kent K. Herbst
Title:	Board Chairman	Title:	NAM- Ethanol Team Leader
Date:	9-26-06	Date:	9/15/06

CONFIDENTIAL

U.S. Water Services Chemical & Services Agreement

Siouxland Ethanol, LLC

Term

U.S. Water Services agrees to provide the necessary water treatment chemicals (reverse osmosis, cooling tower, and boilers) and service program for a period of three years from the startup of the Siouxland Ethanol, LLC plant, which is expected to be operational April, 2007.

Investment

Beginning April 1, 2007, Siouxland Ethanol, LLC agrees to pay U.S. Water Services $9,404.21 per month for specialty water treatment chemicals, testing reagents, engineering services, environmental support services, and plant start up assistance. The payments will be made in monthly installments according to invoices generated by U.S. Water Services, and this amount is based on the nameplate production of 50 million gallons per year. State and local taxes will be added to each invoice unless a tax exemption is on file with U.S. Water Services. This agreement will automatically renew each year. Price increases may be taken on the anniversary date of the contract provided that a 30-day notice of the increase is provided to the customer. All testing reagents are listed in Schedule A-l and the specialty water treatment chemicals covered under this agreement are listed in Schedule B-l.

Initial Order

Not included under the Chemical and Services Agreement are one-time use chemicals and lab equipment. These items are outlined in Schedule D-l. The amount of these items is estimated to be $22,090.77.

Not To Exceed Costs For Chemicals

U.S. Water Services agrees to limit the annual chemical cost for the products in Schedule A-l and B-l to a maximum of $112,850, provided the chemicals are applied within the recommended limits specified by U.S. Water Services. If annual production and water usage are above nameplate design the customer may be billed at a rate of $2,257.01 / 1,000,000 gallons additional ethanol production. Nameplate design and water efficiencies are outlined in Schedule C-l. Operational variances from the design basis outlined in Schedule C-l may result in additional charges. Charges will be reconciled at the end of every quarter. All efficiencies are based on a quarterly average.

Termination

The customer or U.S. Water Services may terminate the chemical and service agreement with 30 days written notice. If the customer terminates the chemical and service agreement, outstanding equipment balances owed, if any, and bundled discounts taken must be paid in full prior to termination. In addition, all remaining opened chemical inventory that is part of this agreement, (Schedule B-l) must be purchased prior to termination. U.S. Water owned equipment shall be returned within 30 days of termination date. If U.S. Water Services terminates the chemical and service agreement, the customer has the choice of continuing to pay equipment installments per the installment schedule or may pay the outstanding amount in full.

The customer and U.S. Water Services agree that the results of any water treatment program depend on the diligent application of the water treatment program and the proper operation of the operating equipment. U.S. Water Services will not be responsible for any failure, caused in whole or part, by the customer not implementing or following recommendations made by U.S. Water Services personnel. Under no circumstances shall U.S. Water Services or the customer be liable to the other for incidental or consequential damages.

Customer:		Supplier: U.S. Water Services
By:	/s/ Tom Lynch	By:	/s/ Kent K. Herbst
	(Signature)		(Signature)
	Tom Lynch		Kent K. Herbst
	(Printed Name)		(Printed Name)
Title: Board Chairman		Title: Ethanol Team Leader
Date: 9-26-06		Date: 9/15/06

Tax Exempt: Yes o No o

     Schedule A-1

Test Kits Description	# of Units	Part No.
SaniCheck AB	3	854 AN
Total Alkalinity	1	226 A
Total Alkalinity	1	226 C
N/50	4	203 G
Free Cl2 packets	6	H21055-69
TDS Soln 3000 umhos	1	117/300F
High Range Hardness Titrating Soln	4	145 G
Low Range Hardness Titrating Soln	2	144 G
Ca Hard. Buffer soln	1	107 A
Ca Hard. Buffer soln	1	107 E
Ca Indicator powder	1	109 B
Ca Indicator powder	1	109 C
BaCl solution 30%	1	101A
BaCl solution 30%	1	101C
Hard. Buffer Soln	1	138 A
Hard. Buffer Soln	1	138 E
Hard. Indicator Powder	1	139 B
Hard. Indicator Powder	1	139 C
4 Automatic 10 ml Burettes	4	702
P Indicator	1	168 A
P Indicator	1	168 C
Starch Acid/Sulfite Indicator Powder	3	199 B
Potassium Iodide Titrating Soln. N/80	1	175 G
Polymer Buffer	1	511 C
Polymer Buffer	2	511 E
Polymer Titrant	1	512 C
Polymer Titrant	1	512 E
Iron Powder Packets 10 ml	3	H21057-69
25 ml Sample Cells (round)	6	H1730-06
Powder Pour Spout	3	799
140 ml casserole	1	738
Eye Dropper 0.5 and 1.0 ml	4	759
Graduated Cylinder, Plastic 100 m	1	778

Additional Services

Services Description	# of Units	Supplier	Start up
Corrosion coupon	16	USWS	4*

* Corrosion coupons for start up include Copper, Carbon Steel, Stainless Steel and Scaling coupon.

Schedule B-1

System	Chemical	Use
Boiler	BWT-103-L Plus	Oxygen Scavenger
Boiler	Boiler MP	Scale/Corrosion Inhibitor
Boiler	RLT-35	Condensate Treatment
Boiler	BWT-200B	Alkalinity Adjustment
Cooling Tower	CWT-530A	Scale/Corrosion Inhibitor
Cooling Tower	Biotrol 509	Non-Oxidizing Biocide
Reverse Osmosis	RO-503	RO Antiscalant
Reverse Osmosis	BWT-104	Chlorine Scavenger
Reverse Osmosis	ROC-20	RO CIP Chemical
Reverse Osmosis	ROC-50 Plus	CO CIP Chemical

Chemicals and equipment not specifically listed in Schedule B-1 above are excluded from this agreement. These include:

• Sulfuric acid

• Chlorine

• Process chemicals

It is the responsibility of the plant to order totes of 12% Sodium Hypochlorite, 66° Baume Sulfuric Acid, and a pallet of salt prior to start up.

Schedule C-1

Siouxland Ethanol (Jackson, NE)

(City, Well, River, Gray)
(NPDES, POTW, Infiltration, Irrigation)

WATER SOURCE:
DISCHARGE: Well
NPDES

U.S. WATER SERVICES
CONFIDENTIAL
Water Balance

Days of Operation per Year	353			days
Plant Production Capacity	50			MMGPY
TOTAL WATER IN	GPM			GPD		GPY
Cooling Tower (non-RO)		0			0		0
Cooling Tower (RO)		496			714,764		252,311,564
Boiler (RO)		87			125,216		44,201,167
MMFGS Filters (Regeneration Flow)		0			0		0
Softener Regeneration		0.08			109		38,306
Final Ethanol Process (not Included)		78			112,320		39,648,960
Process Demand (with RO)		135			194,793		68,761,833
Total Water In		719/719	p		1,034,881		365,312,870

TOTAL WATER OUT	GPM		GPD		GPY
Cooling Towers		55		78,624		27,754,272
RO Unit		320		460,463		162,543,602
Multimedia Filters		0		0		0
Softeners		0.08		109		38,306
Boiler BD (Going to Cook)		0.0		0		0
Ethanol Process Reoyeled
Tower Evaporaton (not included in total)		218		314,496		111,017,088
Total Discharge		374		539,196		190,336,180
Total Water Out (Includes Evap)		593		853,692		301,353,268

COOLING TOWERS

Cooling Tower Recirculation Rate	26,000	gpm
AT Across Cooling Tower	10	ºF
Evaporation Factor	0.84	% evap / 10ºF
Cycles of Concentration	5
Blowdown Quality	101	TDS
RO Makeup Quality	20	TDS
Well Water Makeup Quality	788	TDS
Evaporation Rate	218	gpm
Blowdown	55	gpm
Total Tower Makeup	273	gpm
Tower Alkalinity Target	300	mg/L as CaCO3
Tower Acid Dosing	0	mg/L H2SO4

BOILER

Boiler Steam Rate	101,000		11/hr
Condensate Return	78	%
Cycles of Concentration	60
Blowdown %	1.67	%	as Percentage of Steam Flow
Blowdown Rate	3.4		gpm      Blowdown to Cook
Makeup Rate	48		gpm

FILTRATION SYSTEM

Location of Filters	None
Type of Filters	Greenland
Number of Filters		8
Filter Diameter		72	inches
Number of Backwashes Per Day Per Vessel		1.0	ite I – every day, 0.5 = every other day)
Backwash Time		20	minutes (for each filter)
% of Backwashes Tank is Sized to Capture		8
Backwash Rate		0	gpm
Total Average Daily Usage Rate		0	gpm      Control Rate
Backwash Holding Tank Capacity		0	gallons
Calculated Flux Rate (Normal Operation)		0.00	gpm/ft2
Calculated Flux Rate (During Backwash)		0.00	gpm/ft2

POLISHING SOFTENERS

Number of Softeners	3
Softener Diameter	30	inches
Cubic Feet of Resin in Each	15	ft3
Days Between Regeneration	23	days
Discharge Rate	3	gpm       Don’t Capture Brine
Volume of Regenerant	2496	gallons

REVERSE OSMOSIS

RO Unit % Recovery		55.00	%
Feedwater Temperature		77		ºF
Feed Rate to RO Unit		727		gpm
RO Machine Selection	USW-400			gpm
RO Corrected Permeate Flow		400		gpm
RO Reject Flow		320		gpm
RO to Boiler		48		gpm
Extra RO to Tower		273		gpm
Extra RO to Process		70		gpm

COOLING TOWER MAKE-UP	RO			WELL
GPM		273			0
Makeup %		100	%		0	%

PROCESS MAKE-UP	RO			WELL
GPM		70			8
Makeup %		90	%		10	%

Date:	September 14, 2006
By:	Kent K. ???
Revision:	2

			Raw Water		RO		RO		RO		Cycled		Process		Combined		RO, Tower		RO, Tower
Constituent (mg/l)	As		Source		Feed		Permeate		Reject		Tower		Make-Up		RO & Tower		& Filters		Filters, Soft
TOC		—		2.2		2.2		0.1		4.8		0.4		0.3		4.2		4.2		3.8
P-Alkalinity (CaCO3)	CaCO3			0		0		0		0		0		0		0		0		0
M-Alkalinity (CaCO3)	CaCO3			437		437		16		952		79		59		824		824		759
Bromide	Br			0.5		0.5		0.0		1.1		0.0		0.1		0.9		0.9		0.9
Chloride	Cl			84		84		2		185		8		10		159		159		494
Fluoride		F		0.7		0.7		0.0		1.5		0.1		0.1		1.3		1.3		1.2
Nitrate	NO3			1.0		1.0		0.1		2.1		0.5		0.2		1.9		1.9		1.7
Nitrite	NO2			0.5		0.5		0.0		1.1		0.2		0.1		0.9		0.9		0.9
Total Phosphate	PO4			1.0		1.0		0.0		2.2		0.0		0.1		1.9		1.9		1.7
Total Inorganic Phosphate	PO4			0.8		0.8		0.0		1.8		0.1		0.1		1.5		1.5		1.4
Dissolved Ortho Phosphate	PO4			0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0		0.0
Reactive Silice	SiO2			22.0		22.0		0.8		47.9		4.0		3.0		41.5		41.5		38.2
Sulfur	SO4			135		135		0		299		2		14		256		256		235
Total Hardness	CaCO3			572		572		2		1.262		10		61		1.079		1.079		1,098
Calcium Hardness	CaCO3			388		388		1		860		7		41		736		736		749
Magnesium Hardness	CaCO3			181		181		1		401		3		19		343		343		349
Aluminum	Al			0.1		0.1		0.0		0.2		0.0		0.01		0.2		0.2		0.2
Arsenic	As			0.1		0.1		0.0		0.2		0.0		0.01		0.2		0.2		0.2
Barium	Ba			0.35		0.35		0.00		0.77		0.02		0.04		0.66		0.66		0.61
Beryllium	Be			0.01		0.01		0.00		0.02		0.00		0.00		0.02		0.02		0.02
Boron		B		0.2		0.2		0.0		0.5		0.0		0.0		0.4		0.4		0.4
Cadmium	Cd			0.01		0.01		0.00		0.02		0.00		0.00		0.02		0.02		0.02
Chromium	Cr			0.03		0.03		0.00		0.07		0.00		0.00		0.06		0.06		0.05
Cobalt	Co			0.01		0.01		0.00		0.02		0.00		0.00		0.02		0.02		0.02
Copper	Cu			0.05		0.05		0.00		0.11		0.00		0.01		0.09		0.09		0.09
Iron	Fe			7.70		7.70		0.14		16.94		0.70		0.92		14.57		14.57		13.41
Lead	Pb			0.05		0.05		0.00		0.11		0.00		0.01		0.09		0.09		0.09
Manganese	Mn			0.52		0.52		0.01		1.14		0.05		0.06		0.98		0.98		0.91
Molybdenum	Mo			0.06		0.06		0.00		0.13		0.01		0.01		0.11		0.11		0.10
Nickel	Ni			0.01		0.01		0.00		0.02		0.00		0.00		0.02		0.02		0.02
Potassium		K		12		12		0		26		1		1		23		23		21
Selenium	Se			0.1		0.1		0.0		0.2		0.0		0.0		0.2		0.2		0.2
Sodium	Na			51		51		1		112		5		6		97		97		227
Strontium	Sr			1.6		1.6		0.0		3.5		0.1		0.2		3.0		3.0		2.8
Thalium	Tl			0.1		0.1		0.0		0.2		0.0		0.0		0.2		0.2		0.2
Tin	Sn			0.05		0.05		0.00		0.11		0.01		0.01		0.09		0.09		0.09
Titanium	Ti			0.01		0.01		0.00		0.02		0.00		0.00		0.02		0.02		0.02
Vanodium		V		0.01		0.01		0.00		0.02		0.00		0.00		0.02		0.02		0.02
Zinc	Zn			0.01		0.01		0.00		0.02		0.00		0.00		0.02		0.02		0.02
TDS		—		788		788		20		1,727		101		99		1,490		1,490		1,934
Ca x SO4		—		20,952		20,952		0		103,053		7		235		75,396		75,396		70,549
Cl + SO4		—		219		219		2		484		10		24		415		415		730
Fe + Mn		—		8.2		8.2		0.1		18.1		0.7		1.0		15.6		15.6		14.3
Mg x SiO2		—		967		967		0		4,668		3		14		3,459		3,459		3,242
Ca x Mg x SiO2		—		150,002		150,002		0		1,606,739		9		227		1,018,394		1,018,394		971,184
NO3 + NO2		N		0.4		0.4		0.0		0.8		0.2		0.1		0.7		0.7		0.7
Conductivity	µmhos			1,270		1,270		35		2,782		163		159		2,400		2,400		2,771

Process make-up doesn’t take into account the boiler blowdown (if applicable)

Schedule D-1

Part Number	Description	Use
BoilOut	BoilOut	Chemical for Cleaning Boiler
TowerClean 819	TowerClean 819	Chemical for Cleaning Condenser System
DR-890	Spectrometer	Digital Testing of System Chemistries
TDS EP-10	Conductivity Meter	Used to Determine Operating Levels
717	Auto 10 mL Burettes	Testing Titration Methods
60060	Casserole	Testing Titration Methods
770	Graduated Cylinders	Testing Titration Methods
759	Eye Droppers	Reagent Dosing
Auto SDI	Auto SDI	Determine RO Feed SDI Level

EX-10.22

Exhibit 10.22

REDEVELOPMENT CONTRACT

By and among

COMMUNITY REDEVELOPMENT AUTHORITY
OF THE VILLAGE OF
JACKSON, NEBRASKA

and

SIOUXLAND ETHANOL, LLC

July 20, 2006

TABLE OF CONTENTS

	Page
PARTIES		1
RECITALS		1
ARTICLE I
DEFINITIONS AND INTERPRETATION
Section 1.01 Terms Defined in this Redevelopment Contract		2
Section 1.02 Construction and Interpretation		4
ARTICLE II
REPRESENTATIONS
Section 2.01 Representations by Village and Authority		5
Section 2.02 Representations of Redeveloper		6
ARTICLE III
OBLIGATIONS OF THE AUTHORITY AND THE VILLAGE
Section 3.01 Division of Taxes		7
Section 3.02 Issuance of TIF Indebtedness		8
Section 3.03 Pledge of TIF Revenues		9
Section 3.04 Grant of Proceeds of Bonds		9
Section 3.05 Creation of Fund		9
ARTICLE IV
OBLIGATIONS OF REDEVELOPER
Section 4.01 Construction of Project; Insurance		9
Section 4.02 Cost Certification		10
Section 4.03 Redeveloper to Operate Project		11
Section 4.04 Authority Costs		11
Section 4.05 No Discrimination		11
Section 4.06 Pay Real Estate Taxes		12
Section 4.07 Payment in Lieu of Taxes		12
Section 4.08 No Assignment or Conveyance		12

i

	Page
ARTICLE V
FINANCING REDEVELOPMENT PROJECT; ENCUMBRANCES
Section 5.01 Financing		14
Section 5.02 Encumbrances		14
ARTICLE VI
DEFAULT, REMEDIES; INDEMNIFICATION
Section 6.01 General Remedies of Authority and Redeveloper		15
Section 6.02 Additional Remedies of Authority		15
Section 6.03 Remedies in the Event of Other Redeveloper Defaults		17
Section 6.04 Enforced Delay Beyond Party’s Control		17
Section 6.05 Limitation of Liability; Indemnification		18
ARTICLE VII
MISCELLANEOUS
Section 7.01 Notice Recording		19
Section 7.02 Governing Law		19
Section 7.03 Binding Effect; Amendment		19
Execution by the Authority		20
Execution by the Redeveloper		21
Exhibit A — Description of Redevelopment Area
Exhibit B — Description of Project
Exhibit C — TIF Indebtedness
Exhibit D — Project Costs
Exhibit E — Redevelopment Plan

ii

REDEVELOPMENT CONTRACT

          This Redevelopment Contract is made and entered into as of the 20th day of July, 2006, by and between the Community Redevelopment Authority of the Village of Jackson, Nebraska (“Authority”), and Siouxland Ethanol, LLC, a Nebraska limited liability company (“Redeveloper”).

WITNESSETH:

          WHEREAS, Authority is a duly organized and existing community development agency, a body politic and corporate under the laws of the State of Nebraska, with lawful power and authority to enter into this Redevelopment Contract, acting by and through its Chair or Vice Chair and Members;

          WHEREAS, the Village of Jackson, Nebraska (the “Village”), in furtherance of the purposes and pursuant to the provisions of Section 2 of Article VIII of the Nebraska Constitution and Sections 18-2101 to 18-2154, Reissue Revised Statutes of Nebraska, 1997, as amended (collectively the “Act”), and pursuant to Resolution No. 05-03 of the Village dated August 1, 2005, has designated an area in the Village as blighted and substandard; and

          WHEREAS, pursuant to Section 18-2119 of the Act, Authority has solicited proposals for redevelopment of the blighted and substandard area and Redeveloper submitted a redevelopment contract proposal;

          WHEREAS, Authority and Redeveloper desire to enter into this Redevelopment Contract for acquisition and redevelopment of a parcel in the blighted and substandard area;

          NOW, THEREFORE, in consideration of the Redevelopment Area and the mutual

1

covenants and agreements herein set forth, Authority and Redeveloper do hereby covenant, agree and bind themselves as follows:

ARTICLE I

DEFINITIONS AND INTERPRETATION

Section 1.01 Terms Defined in this Redevelopment Contract.

          Unless the context otherwise requires, the following terms shall have the following meanings for all purposes of this Redevelopment Contract, such definitions to be equally applicable to both the singular and plural forms and masculine, feminine and neuter gender of any of the terms defined:

          “Act” means Section 2 of Article VIII of the Nebraska Constitution, Sections 18-2101 through 18-2154, Reissue Revised Statutes of Nebraska, 1997, as amended, and acts amendatory thereof and supplemental thereto.

          “Authority” means the Community Redevelopment Authority of the Village of Jackson, Nebrask.

          “Certificate of Completion” means a certificate, executed by a Manager or other duly authorized officer of Redeveloper, representing and warranting that the Project is substantially complete.

          “Governing Body” means the Mayor and Village Board of the Village.

          “Holder” means the holders of TIF Indebtedness issued by the Authority from time to time outstanding.

          “Liquidated Damages Amount” means the amounts to be repaid to Authority by Redeveloper pursuant to Section 6.02 of this Redevelopment Contract.

2

          “Project” means the improvements to the Redevelopment Area, as further described in Exhibit B attached hereto and incorporated herein by reference and, as used herein, shall include the Redevelopment Area real estate.

          “Project Cost Certification” means a statement prepared and signed by an independent certified public accountant verifying the payment of Project Costs identified on Exhibit D.

          “Project Costs” means only costs or expenses incurred by Redeveloper to acquire, construct and equip the Project pursuant to the Act as identified on Exhibit D.

          “Redeveloper” means Siouxland Ethanol, LLC, a Nebraska limited liability company.

          “Redevelopment Area” means that certain real property situated in the Village of Jackson, Dakota County, Nebraska, which has been declared blighted and substandard by the Village pursuant to the Act, and which is more particularly described on Exhibit A attached hereto and incorporated herein by this reference.

          “Redevelopment Contract” means this redevelopment contract between Authority and Redeveloper dated July 20, 2006, with respect to the Project.

          “Redevelopment Plan” means the Redevelopment Plan for the Redevelopment Area, prepared by the Authority and approved by the Village pursuant to the Act, as amended from time to time, a true and correct copy of which is attached hereto as Exhibit E.

          “Resolution” means the Resolution of the Authority dated November 7, 2005, as supplemented from time to time, approving this Redevelopment Contract.

          “TIF Indebtedness” means any bonds, notes, loans, and advances of money or other indebtedness, including interest and premiums, if any, thereon, incurred by the Authority pursuant to Article III hereof and secured in whole or in part by TIF Revenues.

3

          “TIF Revenues” means incremental ad valorem taxes generated by the Project which are allocated to and paid to the Authority pursuant to the Act.

          “Village” means the Village of Jackson, Nebraska.

Section 1.02 Construction and Interpretation.

          The provisions of this Redevelopment Contract shall be construed and interpreted in accordance with the following provisions:

     (a) Wherever in this Redevelopment Contract it is provided that any person may do or perform any act or thing the word “may” shall be deemed permissive and not mandatory and it shall be construed that such person shall have the right, but shall not be obligated, to do and perform any such act or thing.

     (b) The phrase “at any time” shall be construed as meaning “at any time or from time to time.”

     (c) The word “including” shall be construed as meaning “Including, but not limited to.”

     (d) The words “will” and “shall” shall each be construed as mandatory.

     (e) The words “herein,” “hereof,” “hereunder,” “hereinafter” and words of similar import shall refer to the Redevelopment Contract as a whole rather than to any particular paragraph, section or subsection, unless the context specifically refers thereto.

     (f) Forms of words in the singular, plural, masculine, feminine or neuter shall be construed to include the other forms as the context may require.

     (g) The captions to the sections of this Redevelopment Contract are for convenience only and shall not be deemed part of the text of the respective sections and shall not vary by implication or otherwise any of the provisions hereof.

4

ARTICLE II

REPRESENTATIONS

Section 2.01 Representations of Authority.

          Authority makes the following representations and findings:

     (a) Authority is a duly organized and validly existing community development agency under the Act.

     (b) The Redevelopment Plan has been duly approved and adopted by the Village pursuant to Section 18-2109 through 18-2117 of the Act, and is hereby approved by the Authority.

     (c) The Authority has requested proposals for redevelopment of the Redevelopment Area pursuant to section 18-2119 of the Act, and deems it to be in the public interest and in furtherance of the purposes of the Act to accept the proposal submitted by Redeveloper as specified herein.

     (d) The Redevelopment Project will achieve the public purposes of the Act by, among other things, increasing employment, improving public infrastructure, increasing the tax base, and lessening conditions of blight and substandard in the Redevelopment Area.

     (e) (1) The Redevelopment Plan is feasible and in conformity with the general plan for the development of the Village as a whole and the plan is in conformity with the legislative declarations and determinations set forth in the Act, and

     (2) (i) the Project would not be economically feasible without the use of tax-increment financing,

          (ii) the Project would not occur in the Redevelopment Area without the use of tax-increment financing, and

          (iii) the costs and benefits of the Project, including costs and benefits to other affected political subdivisions, the economy of the community, and the demand for public

5

and private services have been analyzed by the Village and have been found to be in the long-term best interest of the community impacted by the Project.

     (f) The Authority and the Village have determined that the proposed land uses and building requirements in the Redevelopment Area are designed with the general purpose of accomplishing, in conformance with the general plan, a coordinated, adjusted, and harmonious development of the Village and its environs which will, in accordance with present and future needs, promote health, safety, morals, order, convenience, prosperity, and the general welfare, as well as efficiency and economy in the process of development; including, among other things, adequate provision for traffic, vehicular parking, the promotion of safety from fire, panic, and other dangers, adequate provision for light and air, the promotion of the healthful and convenient distribution of population, the provision of adequate transportation, water, sewerage, and other public utilities, schools, parks, recreational and community facilities, and other public requirements, the promotion of sound design and arrangement, the wise and efficient expenditure of public funds, and the prevention of the recurrence of insanitary or unsafe dwelling accommodations, or conditions of blight.

Section 2.02 Representations of Redeveloper.

          The Redeveloper makes the following representations:

     (a) The Redeveloper is a Nebraska limited liability company, having the power to enter into this Redevelopment Contract and perform all obligations contained herein and by proper action has been duly authorized to execute and deliver this Redevelopment Contract.

     (b) The execution and delivery of the Redevelopment Contract and the consummation of the transactions therein contemplated will not conflict with or constitute a breach of or default under any bond, debenture, note or other evidence of indebtedness or any contract, loan agreement

6

or lease to which Redeveloper is a party or by which it is bound, or result in the creation or imposition of any lien, charge or encumbrance of any nature upon any of the property or assets of the Redeveloper contrary to the terms of any instrument or agreement.

     (c) There is no litigation pending or to the best of its knowledge threatened against Redeveloper affecting its ability to carry out the acquisition, construction, equipping and furnishing of the Project or the carrying into effect of this Redevelopment Contract or, except as disclosed in writing to the Authority, as to any other matter materially affecting the ability of Redeveloper to perform its obligations hereunder.

     (d) Any financial statements of the Redeveloper or its Members delivered to the Authority prior to the date hereof are true and correct in all respects and fairly present the financial condition of the Redeveloper and the Project as of the dates thereof; no materially adverse change has occurred in the financial condition reflected therein since the respective dates thereof; and no additional borrowings have been made by the Redeveloper since the date thereof except in the ordinary course of business, other than the borrowing contemplated hereby or borrowings disclosed to or approved by the Authority.

ARTICLE III

OBLIGATIONS OF THE AUTHORITY

Section 3.01 Division of Taxes.

          In accordance with Section 18-2147 of the Act, the Authority hereby provides that any ad valorem tax on real property in the Project for the benefit of any public body be divided for a period of fifteen years after the effective date of this provision as set forth in this section. The effective date of this provision shall be January 1, 2007.

7

          (a) That proportion of the ad valorem tax which is produced by levy at the rate fixed each year by or for each public body upon the Redevelopment Project Valuation (as defined in the Act) shall be paid into the funds of each such public body in the same proportion as all other taxes collected by or for the bodies; and

          (b) That proportion of the ad valorem tax on real property in the Redevelopment Area in excess of such amount, if any, shall be allocated to, is pledged to, and, when collected, paid into a special fund of the Authority to pay the principal of, the interest on, and any premiums due in connection with the bonds, loans, notes or advances of money to, or indebtedness incurred by, whether funded, refunded, assumed, or otherwise, such Authority for financing or refinancing, in whole or in part, such Project. When such bonds, loans, notes, advances of money, or indebtedness, including interest and premium due have been paid, the Authority shall so notify the County Assessor and County Treasurer and all ad valorem taxes upon real property in such Project shall be paid into the funds of the respective public bodies.

Section 3.02 Issuance of TIF Indebtedness.

          Authority shall incur TIF Indebtedness in the form and principal amount and bearing interest and being subject to such terms and conditions as are specified on the attached Exhibit C. The TIF Indebtedness shall be issued as described in the resolution authorizing the issuance thereof and as described on the attached Exhibit C. Bonds or Notes representing the TIF Indebtedness, or a portion thereof, shall be delivered to the purchaser thereof upon receipt of payment therefore and a purchase agreement in form satisfactory to the Authority. The Authority shall have no obligation to purchase any TIF Indebtedness or to identify a purchaser for any TIF Indebtedness. Proceeds of the TIF Indebtedness shall be deposited in a special account of the Authority created for such purpose.

8

Section 3.03 Pledge of TIF Revenues.

          The Authority hereby pledges the TIF Revenues as security for the TIF Indebtedness. All TIF Indebtedness issued pursuant to this Redevelopment Contact shall be secured on a parity basis.

Section 3.04 Grant of Proceeds of Bonds.

          Authority will grant to Redeveloper the proceeds of the TIF Indebtedness incurred as described on Exhibit C. An amount equal to interest payable on such TIF Indebtedness in 2006 and 2007 shall be retained by the Authority and applied for such purpose or, at the option of the Authority, deposited in a reserve fund of Redeveloper to be applied for such purpose.

          Notwithstanding the foregoing, the amount of the grant shall not exceed the amount of Project Costs certified pursuant to Section 4.02. The grant shall be paid to the Redeveloper upon receipt of requisitions for Project Costs which include supporting documentation requested by Authority and shall, if requested by Redeveloper, be made in one or more advances. Project Costs shall be reimbursed in the order of priority specified on the attached Exhibit D.

Section 3.05 Creation of Fund.

          Authority will create a special fund to collect and hold the TIF Revenues. Such special fund shall be used for no purpose other than to pay TIF Indebtedness issued pursuant to Sections 3.02 and 3.03 above.

Section 3.06

          Authority will provide for hard surfaced road access to the property line of the Redevelopment Area.

ARTICLE IV

OBLIGATIONS OF REDEVELOPER

Section 4.01 Construction of Project; Insurance.

9

     (a) Redeveloper will complete the Project and install all improvements, buildings, fixtures, equipment and furnishings necessary to operate the Project. Redeveloper shall be solely responsible for obtaining all permits and approvals necessary to acquire, construct and equip the Project. Until construction of the Project has been completed, Redeveloper shall make reports in such detail and at such times as may be reasonably requested by the Authority as to the actual progress of Redeveloper with respect to construction of the Project. Promptly after completion by the Redeveloper of the Project, the Redeveloper shall furnish to the Authority a Certificate of Completion. The certification by the Redeveloper shall be a conclusive determination of satisfaction of the agreements and covenants in this Redevelopment Contract with respect to the obligations of Redeveloper and its successors and assigns to construct the Project. As used herein, the term “completion” shall mean substantial completion of the Project.

     (b) Any contractor chosen by the Redeveloper or the Redeveloper itself shall be required to obtain and keep in force at all times until completion of construction, policies of insurance including coverage for contractors’ general liability and completed operations and a penal bond as required by the Act. The Authority and the Redeveloper shall be named as additional insureds. Any contractor chosen by the Redeveloper or the Redeveloper itself, as an owner, shall be required to purchase and maintain property insurance upon the Project to the full insurable value thereof. This insurance shall insure against the perils of fire and extended coverage and shall include “All Risk” insurance for physical loss or damage. The contractor or the Redeveloper, as the case may be, shall furnish the Authority with a Certificate of Insurance evidencing policies as required above. Such certificates shall state that the insurance companies shall give the Authority prior written notice in the event of cancellation of or material change in any of the policies.

Section 4.02 Cost Certification.

10

          Redeveloper shall submit to Authority a certification of Project Costs, on or before the date of submission of the Certificate of Completion, prepared by a certified public accountant acceptable to Authority, which shall contain detail and documentation showing the payment of Project Costs specified on the attached Exhibit D in an amount at least equal to the grant to Redeveloper pursuant to Section 3.04.

Section 4.03 Redeveloper to Operate Project.

          Redeveloper will operate the Project for not less than 15 years from the effective date of the provision specified in Section 3.01 of this Redevelopment Contract. The Project shall be operated in accordance with the provisions of this Redevelopment Contract.

Section 4.04 Authority Costs.

          Redeveloper shall reimburse the Village, on the date of execution of this Redevelopment Contract for legal fees and costs then due, and again upon the issuance of TIF Indebtedness, for legal fees and costs incurred by the Village in connection with this Redevelopment Contract. Redeveloper shall also timely pay all fees and costs of the Authority in connection with the issuance of the Bonds and all fees and costs of any trustee, paying agent or registrar with respect thereto.

Section 4.05 No Discrimination.

          Redeveloper agrees and covenants for itself, its successors and assigns that as long as any TIF Indebtedness is outstanding, it will not discriminate against any person or group of persons on account of race, sex, color, religion, national origin, ancestry, disability, marital status or receipt of public assistance in connection with the Project. Redeveloper, for itself and its successors and assigns, agrees that during the construction of the Project, Redeveloper will not discriminate against any employee or applicant for employment because of race, religion, sex, color,

11

national origin, ancestry, disability, marital status or receipt of public assistance. Redeveloper will comply with all applicable federal, state and local laws related to the Project.

Section 4.06 Pay Real Estate Taxes.

          Redeveloper intends to create a taxable real property valuation of the Redevelopment Area and Project of Twenty Five Million Dollars ($25,000,000.00) no later than January 1, 2007. During the period that any TIF Indebtedness is outstanding, Redeveloper will (1) not protest a real estate property valuation on the Redevelopment Area of Twenty Five Million Dollars ($25,000,000.00) or less after substantial completion or occupancy; (2) not convey the Redevelopment Area or structures thereon to any entity which would be exempt from the payment of real estate taxes or cause the nonpayment of such real estate taxes; and (3) cause all real estate taxes and assessments levied on the Redevelopment Area and Project to be paid prior to the time such become delinquent during the term that any Bonds are outstanding. All real estate taxes levied in the year 2021 shall be paid by Redeveloper on or before December 31, 2021.

Section 4.07 Payment in Lieu of Taxes.

          Redeveloper agrees to make payments in lieu of taxes, immediately upon receipt of notice from Authority, if for any reason at any time TIF Revenues received by the Authority are not sufficient to pay principal and interest on the TIF Indebtedness when due. This payment in lieu of tax obligation shall be represented by a guaranty, note or other evidence of indebtedness and shall be secured by a deed of trust and security agreement on the Redevelopment Area and Project in favor of the Authority, which such mortgage or deed of trust shall be subordinate to the mortgages or deeds of trust described in Section 5.02.

Section 4.08 No Assignment or Conveyance.

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          Redeveloper shall not convey, assign or transfer the Redevelopment Area, the Project or any interest therein prior to the termination of the 15 year period commencing on the effective date specified in Section 3.01 hereof, without the prior written consent of the Authority, which the Authority shall grant or deny within fifteen (15) days of receipt of written request from Redeveloper, which consent shall not be unreasonably withheld, and which the Authority may make subject to any terms or conditions it deems appropriate, except for the following conveyances, which shall be permitted without consent of Authority:

     (a) any conveyance as security for indebtedness incurred by Redeveloper for Project Costs or any subsequent physical improvements to the Redevelopment Area, provided that any such conveyance shall be subject to the obligations of the Redeveloper pursuant to this Redevelopment Contract;

     (b) any conveyance to any person or entity which owns more than 50% of the voting equity interests of Redeveloper (if Redeveloper is a corporation, partnership, limited liability company or other entity) or with respect to which Redeveloper owns more than 50% of the voting equity interests, provided that any such successor owner of the Project agrees to assume all obligations of the Redeveloper and be bound by all terms and conditions of this Redevelopment Contract;

     (c) if Redeveloper is a corporation, partnership or limited liability company, any merger, consolidation, split off, split-up, spin off or other reorganization of Redeveloper which does not result in a substantial change of control or management of the Redeveloper, provided that any such successor owner of the Project agrees to assume all obligations of the Redeveloper and be bound by all terms and conditions of this Redevelopment Contract.

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ARTICLE V

FINANCING REDEVELOPMENT PROJECT; ENCUMBRANCES

Section 5.01 Financing.

          Redeveloper shall pay all Project Costs and any and all other costs related to the Redevelopment Area and the Project which are in excess of the amounts paid from the proceeds of the TIF Indebtedness granted to Redeveloper. Prior to issuance of the TIF Indebtedness, Redeveloper shall provide Authority with evidence satisfactory to the Authority that private funds have been committed to the Redevelopment Project in amounts sufficient to complete the Redevelopment Project. Redeveloper shall timely pay all costs, expenses, fees, charges and other amounts associated with the Project.

          Without limiting the generality of the foregoing, and except as provided in Section 3.06 of this Agreement, Redeveloper shall pay all purchase price and other acquisition costs of the Redevelopment Area and shall pay all off-site public infrastructure costs associated with the Project, including utility extensions and services and improvements.

Section 5.02 Encumbrances.

          Redeveloper shall not create any lien, encumbrance or mortgage on the Project or the Redevelopment Area without the prior written consent of the Authority except encumbrances which secure indebtedness incurred to acquire, construct, equip and operate the Project or for any other physical improvements to the Redevelopment Area. Without limiting the generality of the foregoing, the Redeveloper may secure indebtedness incurred for such purposes in the amount of not to exceed $50,000,000.00 in the aggregate in connection with the initial acquisition, construction, equipping and operation of the Project with mortgages, deeds of trust and security agreements (and

14

refinancings, substitutions and replacements thereof) which have priority over the security for the Project granted pursuant to Section 4.07 of this Agreement.

ARTICLE VI

DEFAULT, REMEDIES; INDEMNIFICATION

Section 6.01 General Remedies of Authority and Redeveloper.

          Subject to the further provisions of this Article VI, in the event of any failure to perform or breach of this Redevelopment Contract or any of its terms or conditions, by any party hereto or any successor to such party, such party, or successor, shall, upon written notice from the other, proceed immediately to commence such actions as may be reasonably designed to cure or remedy such failure to perform or breach which cure or remedy shall be accomplished within a reasonable time by the diligent pursuit of corrective action. In case such action is not taken, or diligently pursued, or the failure to perform or breach shall, not be cured or remedied within a reasonable time, this Redevelopment Contract shall be in default and the aggrieved party may institute such proceedings as may be necessary or desirable to enforce its rights under this Redevelopment Contract, including, but not limited to, proceedings to compel specific performance by the party failing to perform or in breach of its obligations.

Section 6.02 Additional Remedies of Authority.

          In the event that:

     (a) The Redeveloper, or successor in interest, fails to commence construction of the Project (which, for purposes of this paragraph shall mean expenditure of an amount equal to at least ten percent (10%) of the total projected cost of the Project) by July 1, 2006;

     (b) The Redeveloper, or successor in interest, shall fail to complete the construction of the Project on or before July 1,2007, or shall abandon construction work for any period of 90 days;

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     (c) The Redeveloper, or successor in interest, shall fail to pay real estate taxes or assessments on the Redevelopment Area or any part thereof or payments in lieu of taxes pursuant to Section 4.07 when due, and such taxes or assessments or payments in lieu of taxes shall not have been paid, or provisions satisfactory to the Authority made for such payment within 30 days following written notice from Authority; or

     (d) There is, in violation of Section 4.08 of this Redevelopment Contract, transfer of the Redevelopment Area or any part thereof, and such failure or action by the Redeveloper has not been cured within 30 days following written notice from Authority, then the Redeveloper shall be in default of this Redevelopment Contract.

          In the event of such failure to perform, breach or default occurs and is not cured in the period herein provided, the parties agree that the damages caused to the Authority would be difficult to determine with certainty and that a reasonable estimation of the amount of damages that could be incurred is the amount of the grant to Redeveloper pursuant to Section 3.05 of this Redevelopment Contract, less any reductions in the principal amount of the TIF Indebtedness, plus interest on such amounts as provided herein (the “Liquidated Damages Amount”). The Liquidated Damages Amount shall be paid by Redeveloper to Authority within 30 days of demand from Authority.

          Interest shall accrue on the Liquidated Damages Amount at the rate of one percent (1%) over the prime rate as published and modified in the Wall Street Journal from time to time and interest shall commence from the date that the Authority gives notice to the Redeveloper demanding payment.

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          Payment of the Liquidated Damages Amount shall not relieve Redeveloper of its obligation to pay real estate taxes or assessments or payments in lieu of taxes with respect to the Project.

Section 6.03 Remedies in the Event of Other Redeveloper Defaults.

          In the event the Redeveloper fails to perform any other provisions of this Redevelopment Contract (other than those specific provisions contained in Section 6.02), the Redeveloper shall be in default. In such an instance, the Authority may seek to enforce the terms of this Redevelopment Contract or exercise any other remedies that may be provided in this Redevelopment Contract or by applicable law; provided, however, that the default covered by this Section shall not give rise to a right or rescission or termination of this Redevelopment Contract, and shall not be covered by the Liquidated Damages Amount.

Section 6.04 Enforced Delay Beyond Party’s Control.

          For the purposes of any of the provisions of this Redevelopment Contract, neither the Authority nor the Redeveloper, as the case may be, nor any successor in interest, shall be considered in breach of or default in its obligations with respect to the conveyance or preparation of the Redevelopment Area for redevelopment, or the beginning and completion of construction of the Project, or progress in respect thereto, in the event of enforced delay in the performance of such obligations due to unforeseeable causes beyond its control and without its fault or negligence, including, but not restricted to, acts of God, or of the public enemy, acts of the Government, acts of the other party, fires, floods, epidemics, quarantine restrictions, strikes, freight embargoes, and unusually severe weather or delays in subcontractors due to such causes; it being the purpose and intent of this provision that in the event of the occurrence of any such enforced delay, the time or times for performance of the obligations of the Authority or of the Redeveloper with respect to construction of the Project, as the case may be, shall be extended for the period of the enforced delay;

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Provided, that the party seeking the benefit of the provisions of this section shall, within thirty (30) days after the beginning of any such enforced delay, have first notified the other party thereof in writing, and of the cause or causes thereof and requested an extension for the period of the enforced delay.

Section 6.05 Limitation of Liability; Indemnification.

          Notwithstanding anything in this Article VI or this Redevelopment Contract to the contrary, neither Authority, Village, nor their officers, directors, employees, agents or their governing bodies shall have any pecuniary obligation or monetary liability under this Redevelopment Contract. The sole obligation of the Village and the Authority under this Redevelopment Contract shall be the issuance of the TIF Indebtedness and granting the proceeds thereof to Redeveloper as set forth in Article III. The obligation of the Authority on any TIF Indebtedness shall be limited solely to the TIF Revenues pledged as security for such TIF Indebtedness. Specifically, but without limitation, neither Village nor Authority shall be liable for any costs, liabilities, actions, demands, or damages for failure of any representations, warranties or obligations hereunder. The Redeveloper releases the Authority and the Village from, agrees that the Authority and the Village shall not be liable for, and agrees to indemnify and hold the Authority and the Village harmless from any liability for any loss or damage to property or any injury to or death of any person that may be occasioned by any cause whatsoever pertaining to the Project.

          The Redeveloper will indemnify and hold each of the Authority and the Village and their directors, officers, agents, employees and member of their governing bodies free and harmless from any loss, claim, damage, demand, tax, penalty, liability, disbursement, expense, including litigation expenses, attorneys’ fees and expenses, or court costs arising out of any damage or injury, actual or claimed, of whatsoever kind or character, to property (including loss of use thereof) or

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persons, occurring or allegedly occurring in, on or about the Project during the term of this Redevelopment Contract or arising out of any action or inaction of Redeveloper, whether or not related to the Project, or resulting from or in any way connected with specified events, including the management of the Project, or in any way related to the enforcement of this Redevelopment Contract or any other cause pertaining to the Project.

ARTICLE VII

MISCELLANEOUS

Section 7.01 Notice Recording.

          This Redevelopment Contract or a notice memorandum of this Redevelopment Contract shall be recorded with the County Register of Deeds in which the Redevelopment Area is located.

Section 7.02 Governing Law.

          This Redevelopment Contract shall be governed by the laws of the State of Nebraska, including but not limited to the Act.

Section 7.03 Binding Effect; Amendment.

          This Redevelopment Contract shall be binding on the parties hereto and their respective successors and assigns. This Redevelopment Contract shall run with the Redevelopment Area. The Redevelopment Contract shall not be amended except by a writing signed by the party to be bound.

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          IN WITNESS WHEREOF, Authority and Redeveloper have signed this Redevelopment Contract as of the date and year first above written.

ATTEST:		COMMUNITY REDEVELOPMENT AUTHORITY OF THE VILLAGE OF JACKSON, NEBRASKA
	/s/ Donna Hirsch	By:	/s/ Margaret Rahn
Its:	Village Crew	Its:	Chairperson Proteum

STATE OF NEBRASKA	)
	) ss.
COUNTY OF DAKOTA	)

          The foregoing instrument was acknowledged before me this 20^th day of July, 2006, by Margaret Rahn and                                                       ,                   and                  , respectively, of the Community Redevelopment Authority of the Village of Jackson, Nebraska, on behalf of the Authority.

(S E A L)
GENERAL NOTARY, State of Nebraska	/s/ Joan C. Spencer
JOAN C. SPENCER My Comm. Exp. 6-30-08	Notary Public

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SIOUXLAND ETHANOL, LLC, Redeveloper
By:	/s/ Tom Lynch
Its:	Manager

STATE OF NEBRASKA	)
	) ss.
COUNTY OF DAKOTA	)

          The foregoing instrument was acknowledged before me this 24 day of July, 2006, by Tom Lynch, Manager of Siouxland Ethanol, LLC, on behalf of the limited liability company.

(S E A L)
GENERAL NOTARY, State of Nebraska	/s/ Ryan Jones
RYAN JONES My Comm. Exp. June 30, 2008	Notary Public

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EXHIBIT A

DESCRIPTION OF REDEVELOPMENT AREA

Tracts of land located over and across Sections 35, 34 and 27, Township 29 North, Range 7 East of the 6^th P.M., Dakota County, more particularly described as follows: Beginning at the intersection of the center line of Highway #20 and the West line of the Village of Jackson, Nebraska, thence Northwesterly along the centerline of said Highway #20 to the point of intersection with the North line of the Southwest 1/4 of Section 27, Township 29 North, Range 7 East of the 6^th P.M., Dakota County, Nebraska; thence Westerly on said North line to the intersection to the West property line of Tract “B”, thence Southeasterly along said West property line of Tract “B” to a point of the intersection with the South line of Section 27, Township 29 North, Range 7 East of the 6^th P.M., Dakota County, Nebraska; thence Easterly along said South line to the intersection with the East Right-Of-Way line of the Chicago, St. Paul, Minneapolis and Omaha Railroad Company (n/k/a Nebraska Northeastern Railway Company); thence Southeasterly along the said Eastern Railroad Right-Of-Way line to the point of intersection with the West line of the SE 1/4 of the NE 1/4 of Section 35, Township 29 North, Range 7 East of the 6^th P.M.; thence North along said quarter-quarter line to the West line of the Village of Jackson; thence continue on the West line of the Village of Jackson to the intersection with the center line of Highway #20 which is the point of beginning.

Said described parcel is contiguous and adjacent to the Village of Jackson, Nebraska.

A-1

EXHIBIT B

DESCRIPTION OF PROJECT

An ethanol production facility, including all necessary receiving, storage, processing, pollution control, waste handling, and shipping buildings, equipment and furnishings and ancillary facilities sufficient to produce approximately 50 million gallons of anhydrous ethanol annually.

B-1

EXHIBIT C

TIF INDEBTEDNESS

1.	Principal Amount:	Not to exceed amount which can be fully paid, with interest, based on current overall tax levy and projected assessed value of Project real estate upon completion.
2.	Payments:	Interest only in 2006 and 2007. Thereafter, principal and interest semi-annually, in amounts sufficient to fully pay the TIF Indebtedness in full on or before December 31, 2021, as set by Resolution of the Authority.
3.	Interest Rate:	Not to exceed ten percent (10%) per annum, as set by Resolution of the Authority.
4.	Maturity Date:	On or before December 31, 2021.
5.	Security:	First pledge of TIF Revenues and subordinate pledge of certain assets of Redeveloper.

C-1

EXHIBIT D

PROJECT COSTS

All Project Costs payable from the proceeds of TIF Indebtedness pursuant to the Act including, in the following order of priority:

1.	All acquisition costs of the Redevelopment Area
2.	Site work and site preparation
3.	Utility extensions, installation of gas, water, sewer and electrical lines and equipment
4.	Construction of roadways and rail service lines
5.	Pollution control equipment

D-1

EXHIBIT E

REDEVELOPMENT PLAN

E-1

EX-10.23

Exhibit 10.23

SIOUXLAND ETHANOL, LLC

TO

COMMUNITY REDEVELOPMENT AUTHORITY
VILLAGE OF JACKSON, NEBRASKA

TAX INCREMENT REVENUE BONDS

(SIOUXLAND ETHANOL, LLC PROJECT)

GUARANTY AGREEMENT

Dated September 28, 2006

          This Guaranty Agreement is dated September 28, 2006 (the “Guaranty”), from Siouxland Ethanol, LLC (“Guarantor”), to Wells Fargo Bank, National Association, as trustee (“Trustee”) for holders (“Holders”) of Community Redevelopment Authority of the Village of Jackson, Nebraska’s (“Authority”) Tax Increment Revenue Bonds, Taxable Series 2006A (Siouxland Ethanol, LLC Project) (the “Bonds”).

W I T N E S S E T H

          WHEREAS, prior to, or contemporaneously with, the execution and delivery of this Guaranty, the Authority has entered into a Redevelopment Contract, dated July 20, 2006 (the “Agreement”) with Guarantor under which Authority issued the Bonds and has granted funds to Guarantor to construct a project located in Jackson, Nebraska (“the Project”); and

          WHEREAS, for the purpose of providing security for the payment of the Bonds and certain obligations created pursuant to the Agreement, Guarantor hereby agrees to guarantee the prompt and punctual payment of the Bonds and other sums, as more fully set forth herein; and

          NOW, THEREFORE, in consideration of the foregoing, the Guarantor hereby covenants and agrees as follows:

ARTICLE I

REPRESENTATIONS AND WARRANTIES OF GUARANTOR

Guarantor hereby represents and warrants as follows:

     (a) Guarantor is duly organized, validly existing and in good standing under the laws of the State of Nebraska, is authorized to do business in the State of Nebraska, has the powers and legal authority to own the property and assets, to carry on its business as now being conducted by it and to execute, deliver and perform this Guaranty.

     (b) Any officers or other persons or agents Guarantor executing this Guaranty have been duly authorized to execute and deliver this Guaranty and the execution, delivery and performance of this Guaranty and the consummation of the transactions herein contemplated have been duly authorized by all requisite action on the part of the Guarantor and will not violate any provision of law, any order of any court or other agency of government or the documents governing the Guarantor, or any indenture, agreement or other instrument to which the Guarantor is a party or by which it or any of its property is bound, or be in conflict with or result in a breach of or constitute (with due notice and/or lapse of time) a default under any such indenture, agreement or other instrument.

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     (c) All necessary authorizations, approvals, consents and other orders of any governmental authority or agency for the execution and delivery by Guarantor of this Guaranty have been obtained and are in full force and effect and all such authorizations, approvals, consents, permits and licenses required as of the date hereof for the performance by Guarantor of their obligations hereunder have been obtained and are in full force and effect.

ARTICLE II

COVENANTS AND AGREEMENTS

     Section 2.1. The Guaranty.

     (a) Guarantor hereby guarantees to the Holders full and prompt payment of principal, premium, if any and interest, if any, on the Bonds when due, whether at maturity, upon acceleration, or otherwise.

     (b) Guarantor further agrees that its undertakings in subsection (a) of this Article of this Guaranty constitute an absolute, unconditional, present and continuing guaranty of payment and not of collection, and waives any right to require that any resort be had by the Holder against the Authority or to any security held by the Authority.

     (c) If default shall be made in payment of principal, premium, if any, or interest, if any, on any Bond when and as the same shall become due, whether at the stated maturity thereof, by acceleration or otherwise, Guarantor, upon demand by the Holder, without notice other than such demand and without the necessity of further action, as the case may be, will promptly and fully make such payments no later than 12 noon central time on the third Business Day next following the date such demand is given. Such payment shall be made to the Trustee as trustee for the Holders. Guarantor will pay all reasonable costs and expenses, including attorneys’ fees, paid or incurred by Holder in connection with the enforcement of the obligations of Guarantor under this Guaranty. All payments by Guarantor shall be made in any coin or currency of the United States of America which on the respective dates of payment thereof is legal tender for the payment of public and private debts. Each default in payment shall give rise to a separate cause of action hereunder, and separate demands and suits may be brought hereunder as each cause of action arises.

     Section 2.2. Absolute and Unconditional Guaranty.

          The obligations of Guarantor under this Guaranty shall be absolute and unconditional and shall remain in full force and effect until the entire amount payable on the Bonds shall have been paid in full or provided for, and to the extent permitted by law, such obligations shall not be affected, modified, released, or impaired by any state of facts or the happening from time to time of any event including, without limitation, any of the following, whether or not with notice to, or the consent of Guarantor:

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     (a) any present or future law or order of any government (de jure or de facto) or of any agency thereof purporting to reduce, amend or otherwise affect the foregoing or any other obligation of Guarantor or to vary any terms of payment;

     (b) the failure to give notice to Guarantor of the occurrence of any Event of Default under the terms and provisions of this Guaranty or the Bonds as set forth therein;

     (c) the waiver of the payment, performance or observance by the Guarantor of any of the obligations, conditions, covenants or agreements of any or all of them contained in this Guaranty or in the Bonds;

     (d) the receipt and acceptance of notes, checks or other instruments for the payment of money made by Guarantor which notes, checks or other instruments have been dishonored, and any extensions and renewals thereof;

     (e) the extension of the time for payment of principal or interest or any other amounts that are due or may become due under the Bonds, or this Guaranty or of the time for performance of any other obligations, covenants or agreements under or arising out of the Bonds or this Guaranty;

     (f) the modification or amendment (whether material or otherwise) of any duty, obligation, covenant or agreement set forth in the Resolution, the Bonds or this Guaranty;

     (g) any failure, omission, delay or lack thereof on the part of the Authority to assert or exercise any right, power or remedy conferred on the Authority in the Bonds or this Guaranty;

     (h) the voluntary liquidation, dissolution, merger, consolidation, sale or other disposition of all or substantially all the assets, marshaling of assets and liabilities, receivership, insolvency, bankruptcy, assignment for the benefit of creditors, reorganization, arrangement, composition with creditors or readjustment of, or other similar proceedings affecting Guarantor, or any or all of the assets of Guarantor, or any allegation or contest of the validity of the Bonds or this Guaranty in any such proceeding; it is specifically understood, consented and agreed to that this Guaranty shall remain and continue in full force and effect and shall be enforceable against Guarantor to the same extent and with the same force and effect as if such proceedings had not been instituted;

     (i) to the extent permitted by law, the release or discharge of Guarantor from the performance or observance of any obligation, covenant or agreement contained in this Guaranty by operation of law;

     (j) the default or failure of Guarantor fully to perform any of its obligations set forth in this Guaranty;

     (k) any release or impairment of the security pledged to the Authority as security;

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     (l) the release, substitution or replacement in accordance with the terms of the Bonds of any property subject thereto or any redelivery, repossession, surrender or destruction of any such property, in whole or in part;

     (m) any termination of the Bonds or the Agreement by reason of breach or default of Guarantor or the invalidity or unenforceability of the Bonds or the Agreement by reason of any facts pertaining to Guarantor;

     (n) any failure of the Guarantor to mitigate damages resulting from any default by Guarantor under the Bonds or the Agreement;

     (o) any other circumstances that might otherwise constitute a legal or equitable discharge or defense of a surety or a guarantor other than Guarantor’s failure to perform its obligations; or

     (p) any other occurrence whatsoever, whether similar or dissimilar to the foregoing.

     Section 2.3. Event of Default.

          An “Event of Default” shall exist if any of the following occurs and is continuing:

     (a) Guarantor defaults in any guaranty referred to in Section 2.1(a), 2.1(b) or 2.1(c) hereof;

     (b) Guarantor fails to observe and perform any covenant, condition or agreement other than such referred to in Section 2.3(a) hereof and such failure continues for more than thirty (30) days after written notice (which shall be deemed given upon receipt of registered or certified mailing) of such failure has been given to Guarantor by the Authority, the Paying Agent or the Holder or if by reason of such default the same cannot be remedied within said thirty (30) days;

     (c) any warranty, representation or other statement by or on behalf of any Guarantor contained in this Guaranty is false or misleading in any material respect as of the date made;

     (d) (i) the entry of a decree or order for relief by a court having jurisdiction in the premises in respect of Guarantor in an involuntary case under the federal bankruptcy laws, as now or hereafter constituted, or any other applicable federal or state bankruptcy, insolvency or other similar law, or appointing a receiver, liquidator, assignee, custodian, trustee, sequestrator (or similar official) of Guarantor or for any substantial part of any of its property, or ordering the winding-up or liquidation of its affairs and the continuance of any such decree or order unstayed and in effect for a period of 30 consecutive days, or (ii) the commencement by Guarantor of a voluntary case under the federal bankruptcy laws, as now constituted or hereinafter amended, or any other applicable federal or state bankruptcy, insolvency or other similar law, or the consent by Guarantor to the appointment of or taking possession by a receiver, liquidator, assignee, trustee, custodian, sequestrator (or other similar official) or the making by any of them of any assignment for the benefit

5

of creditors, or the taking of corporate action by Guarantor to authorize or effect any of the foregoing.

     Section 2.4. Remedies Upon Default.

     (a) Upon an Event of Default under Section 2.3 of this Guaranty, the Holder shall have the right to proceed first and directly against Guarantor under this Guaranty without proceeding against or exhausting any other remedies which it may have and without resorting to any security held by it.

     (b) Each and every default in the payment or performance of the obligations specified in Section 2.4(a) hereof shall give rise to a separate cause of action hereunder, and separate suits may be brought hereunder as each cause of action arises.

     Section 2.5. Waiver of Notice of Non-Payment and Costs of Enforcement.

          Guarantor hereby expressly waives presentment, demand, protest and notice of non-payment and further waive notice from the Trustee of its acceptance and reliance on this Guaranty. Guarantor jointly and severally agrees to pay all costs, disbursements and expenses (including all reasonable attorneys’ fees) which may be incurred by the Trustee in enforcing or attempting to enforce this Guaranty following any default on the part of Guarantor hereunder, whether the same shall be enforced by suit or otherwise.

ARTICLE III

MISCELLANEOUS

     Section 3.1. Amendment.

          This Guaranty may not be amended, changed, modified, altered or terminated except as agreed in writing by the parties.

     Section 3.2. Termination Date.

          The obligations of Guarantor hereunder shall terminate absolutely and unconditionally when the principal, premium, if any and interest on all of the Bonds shall have been paid in full.

     Section 3.3. Remedies Not Exclusive.

          No remedy herein conferred upon or reserved to Trustee is intended to be exclusive of any other available remedy or remedies, but each and every such remedy shall be cumulative and shall be in addition to every other remedy given under this Guaranty or now or hereafter existing at law or in equity. No delay or omission to exercise any right or power accruing upon any Event of

6

Default, omission or failure of performance hereunder shall impair any such right or power or shall be construed to be a waiver in the event any provision contained in this Guaranty should be breached by any party and thereafter duly waived by the other party so empowered to act. Such waiver shall be limited to the particular breach so waived and shall not be deemed to waive any other breach hereunder. No waiver, amendment, release or modification of this Guaranty shall be established by conduct, custom or course of dealing, but solely by an instrument in writing duly executed by the parties thereunto duly authorized by this Guaranty.

     Section 3.4. Notices.

          Except as otherwise provided herein, all notices or other communications hereunder shall be sufficiently given and shall be deemed given when delivered by hand delivery or on the second day following the day on which the same has been mailed, postage prepaid, by certified mail, addressed as follows if to the Trustee:

Wells Fargo Bank, National Association
1248 O Street
Lincoln, NE 68508
Attn: Corporate Trust

together with other addresses furnished to Guarantor from time to time, and if to the Guarantor:

Siouxland Ethanol, LLC
1501 Knox Boulevard
P.O. Box 147
Jackson, NE 68743

     Section 3.5. Counterparts.

          This Guaranty constitutes the entire agreement, and supersedes all prior agreements and understandings, both written and oral, between the parties with respect to the subject matter hereof and may be executed simultaneously in several counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument.

     Section 3.6. Severability.

          The invalidity or unenforceability of any one or more phrases, sentences, clauses or Sections in this Guaranty contained, shall not affect the validity or enforceability of the remaining portions of this Guaranty, or any part thereof.

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     Section 3.7. Governing Law.

          This Guaranty shall be governed by and construed in accordance with the laws of the State of Nebraska.

     Section 3.8. Successors and Assigns.

          This Guaranty shall be binding upon, inure to the benefit of and be enforceable by the parties hereto and their respective successors and assigns.

          IN WITNESS WHEREOF, Guarantor has caused this Guaranty to be executed, all as of the date first above written.

	Guarantor:
	SIOUXLAND ETHANOL, LLC
By:	/s/ Tom Lynch
	Its Managing Member

8

EX-10.24

Exhibit 10.24

STATE of NEBRASKA DAKOTA COUNTY	}	ss.
Filed for record this 3 day of
October 2006 at 2:40 o’clock
P M., and recorded as
Instrument No 06-010248
Register of Deads ???

DATE: September 28, 2006

SUBORDINATE DEED OF TRUST, ASSIGNMENT OF LEASES AND RENTS, AND
SECURITY AGREEMENT
FIXTURE FINANCING STATEMENT
(Hereinafter referred to as “Deed of Trust”)

MADE BY

SIOUXLAND ETHANOL, LLC
1501 Knox Boulevard
P.O. Box 147
Jackson, NE 68743
(Hereinafter referred to as “Trustor”)

TO

Wells Fargo Bank, National Association,
as Trustee
1248 O Street
Lincoln, NE 68508
(Hereinafter referred to as “Trustee”)

(Hereinafter collectively referred to as “Beneficiary” and “Secured Party”)

THIS DEED OF TRUST CONSTITUTES A FIXTURE FINANCING STATEMENT
UNDER THE NEBRASKA UNIFORM COMMERCIAL CODE

          To the extent of Trustor’s estate, right, title and interest to the Property as defined below, Trustor hereby irrevocably grants, transfers, pledges and assigns to Trustee, its successors and assigns, IN TRUST, WITH POWER OF SALE and right of entry and possession, all of Trustor’s estate, right, title and interest in any and all of the following described property which is (except where the context otherwise requires) herein collectively called the “Property,” whether now owned or held or hereafter acquired, and any proceeds thereof or accessions thereto, including:

     (A) That certain real property, more particularly described in Exhibit A attached hereto and incorporated herein by this reference, together with all of the easements, rights, privileges, franchises and appurtenances thereunto belonging or in anywise appertaining, and all structures and buildings and leasehold improvements now or at any time hereafter located therein (hereinafter such real property, when referred to alone, shall be referred to as the “Premises”), and all of the estate, right, title, interest, claim and demand whatsoever of Trustor therein or thereto, either at law or in equity, in possession or in expectancy, now or hereafter acquired;

     (B) All equipment, apparatus, machinery, fixtures, fittings, vehicles, tools, rolling stock and appliances and any additions to, substitutions for, changes in or replacement of the whole or any part thereof, now or at any time hereafter affixed to, attached to, placed upon or used in any way in connection with the use, enjoyment, occupancy or operation of the Premises or any portion thereof or otherwise used by Trustor (the “Equipment”);

     (C) All rights, title and interest of Trustor in and to all streets, roads and public places, opened or proposed, and all easements and rights of way, vaults, party wall agreements, public or private, revocable licenses, tenements, hereditaments, rights and appurtenances, now or hereafter used in connection with, belonging or appertaining to the Premises (hereinafter referred to, together with the Premises and Equipment, as the Real Property);

     (D) All of the rents, royalties, issues, profits, revenue, income, proceeds and other benefits of the Property (the “Rents and Profits”), including the Trustor’s interest in the real estate described in Exhibit A attached hereto and incorporated by this reference, or arising from the use or enjoyment of all or any portion thereof or from any lease or agreement pertaining thereto, and all right, title and interest of Trustor in and to all leases of the Property, including all or any portion of the real estate described in Exhibit A, now or hereafter entered into, and all right, title and interest of Trustor thereunder, including, without limitation, cash or securities deposited thereunder to secure performance by the lessees of their obligations thereunder, whether said cash or securities are to be held until the expiration of the terms of said leases or applied to one or more of the installments of rent coming due immediately prior to the expiration of the terms of said leases or applied to one or more of the installments of rent coming due immediately prior to the expiration of said terms; subject to, however, the provisions contained in Section 1.06 hereof;

     (E) All proceeds (including claims and demands therefor) of the conversion, voluntary or involuntary, of any of the foregoing Property into cash or liquidated claims, including, without limitation, proceeds of insurance and condemnation awards on the Premises (hereinafter sometimes called “Insurance Proceeds” and “Condemnation Proceeds”); and

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     (F) All rights, title and interest of Trustor in any and all building permits, revocable license permits (including insurance and bonds), any and other permits, licenses or authorization required by the governmental authorities having or exercising jurisdiction over the Premises or Fixtures (hereinafter collectively referred to as “Permits, Licenses, Approvals and Agreements”).

          FOR THE PURPOSE OF SECURING, due, prompt and complete observance, performance and discharge of each and every payment, obligation, covenant and agreement contained in the Community Redevelopment Authority of the Village of Jackson, Nebraska’s (“Authority”) Tax Increment Revenue Bonds (Siouxland Ethanol, LLC Project) (the “Bonds”), in the original principal amount of $4,030,000, and all obligations of Trustor pursuant to a Guaranty Agreement in favor of Beneficiary dated as of the date of this Deed of Trust (“Guaranty”), subject to (i) liens for ad valorem taxes and special assessments not then delinquent; (ii) this Bond Resolution; (iii) the Redevelopment Contract; (iv) this Subordinate Deed of Trust; (v) utility, access and other easements and rights-of-way, mineral rights, reservations, restrictions and exceptions that are of record on the date hereof; (vi) such minor defects, irregularities, encumbrances, easements, rights-of-way and clouds on title as normally exist with respect to properties similar in character to the Premises and as do not in the aggregate, in the opinion of Independent Counsel, materially impair the property affected thereby for the purposes for which it was acquired or is held by the Company; and (vii) deeds of trust or mortgages securing debt financing incurred by Company for acquisition, construction, equipping and operating the Project.

The Bonds and Guaranty are hereinafter referred to together as the “Obligations.”

Pursuant to that certain Subordination Agreement, dated as of September 28, 2006 (the “Subordination Agreement”), between the Trustee and Farm Credit Services of America, FLCS and CoBank, ACB as its administrative agent (the “Senior Lender”), the liens and security interests granted to the Trustee herein are expressly subordinate to the liens and security interests the Company has granted or may grant to the Senior Lender. The Subordination Agreement restricts the ability of the Trustee to enforce the Deed of Trust, to take other actions, and to accept payments from the Company without the consent of the Senior Lender.

     The Agreement does not restrict the ability of the Company to incur additional indebtedness and grant liens and security interests to secure such indebtedness. The Senior Credit Facility and any additional debt of the Company from the Senior Lender will be secured on a senior basis to the security granted by this Deed of Trust. In addition, the Company may secure certain additional debt on a parity basis with the security for the Bonds granted herein.

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ARTICLE I

COVENANTS OF TRUSTOR

          To protect the security of this Deed of Trust, Trustor covenants, warrants and agrees to and with Beneficiary and Trustee as follows:

     1.01 Payment of Principal and Interest. Trustor will pay the principal of and interest, if any, on and all other sums becoming due or payable with respect to the Obligations at the time and place and in the manner specified in the Obligations and in the Resolution of the Authority dated July 20, 2006, and this Deed of Trust according to the terms of the Obligations, the Resolution and this Deed of Trust.

     1.02 Warranty of Title. Trustor warrants that it has good and marketable title in fee simple to the Premises subject to no lien, charge or encumbrance except such as are listed as exceptions to title in the title policy or policies insuring the lien of this Deed of Trust issued upon recordation hereof by a title company or companies acceptable to Beneficiary. This Deed of Trust is and will remain a valid and enforceable lien on the Property subject only to the exceptions referred to above. Trustor has full power and lawful authority to grant, assign, transfer and mortgage its interest in the Property in the manner and form hereby done or intended. Trustor will preserve its interest in and title to the Property and will forever collectively warrant and defend the same to Trustee and will forever warrant and defend the validity and priority of the lien hereof against the claims of all persons and parties whomsoever. Trustor shall promptly and completely observe, perform, and discharge each and every obligation, covenant and agreement affecting the Property whether the same is prior and superior or subject and subordinate hereto.

     1.03 Further Assurances.

          (a) Trustor will do, execute, acknowledge and deliver all and every such further acts, deeds, conveyances, mortgages, assignments, notices of assignments, pledge agreements, transfers and assurances as Trustee or Beneficiary shall from time to time reasonably require, for the better assuring, conveying, assigning, transferring and confirming unto Trustee and Beneficiary the property and rights hereby conveyed or assigned or intended now or hereafter so to be, or which Trustor may be or may hereafter become bound to convey or assign to Trustee or Beneficiary, or for carrying out the intention or facilitating the performance of the terms of this Deed of Trust, or for filing, registering or recording this Deed of Trust and, on demand, Trustor will execute and deliver, and hereby authorizes Trustee or Beneficiary to execute in the name of Trustor to the extent Trustor may lawfully do so, one or more financing statements, chattel mortgages or comparable security instruments, to evidence more effectively the lien hereof upon the Fixtures.

          (b) Trustor forthwith upon the execution and delivery of this Deed of Trust, and thereafter from time to time, will cause this Deed of Trust, and any security instrument creating a lien or evidencing the lien hereof upon the Property and each instrument of further assurance, to be filed, registered or recorded in such manner and in such places as may be required by any present or future law in order to publish notice of and fully to protect the lien hereof upon the title of Trustee to, and the security interest of Beneficiary in the Property.

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     1.04 Conversion and Security. All right, title and interest of Trustor in and to all extensions, improvements, betterments, renewals, substitutes and replacements of, and all additions and appurtenances to the Property, hereafter acquired by, or released to Trustor, or constructed, assembled or placed by Trustor on the Premises and all conversions of the security constituted thereby, immediately upon such acquisition, release, construction, assembling, placement or conversion, as the case may be, and in each such case, without any further deed of trust, conveyance, assignment or other act by Trustor, shall become subject to the lien of this Deed of Trust as fully and completely, and with the same effect, as though now owned by Trustor and specifically described in the granting clause hereof, but at any and all times Trustor will execute and deliver to Trustee any and all such further assurances, deeds of trust, conveyances or assignments thereof as Trustee or Beneficiary may reasonably require for the purpose of expressly and specifically subjecting the same to the lien of this Deed of Trust.

     1.05 Security Agreement. To the extent allowed by the Nebraska Uniform Commercial Code, this Deed of Trust shall be self-operative and constitute a Security Agreement and Fixture Financing Statement with respect to the Equipment, Rents and Profits, Insurance Proceeds and Condemnation Proceeds, Permits, Licenses, Approvals and Agreements. Trustor hereby agrees to execute and deliver on demand and hereby irrevocably constitutes and appoints Beneficiary the attorney-in-fact of Trustor, to execute, deliver and, if appropriate, to file with the appropriate filing officer or office such security agreements, financing statements or other instruments as Beneficiary may request or require in order to impose or perfect the lien or security interest hereof more specifically thereon. A photographic or other reproduction of this Deed of Trust or of any financing statement relating to this Deed of Trust shall be sufficient as a financing statement.

     1.06 Assignment of Rents and Profits. Beneficiary and Trustee shall have the right, power and authority during the continuance of this Deed of Trust to collect the Rents and Profits of the Property and of personal property located thereon with or without taking possession of the Property affected hereby, and Trustor hereby absolutely and unconditionally assigns all such Rents and Profits to Beneficiary including the Rents and Profits of the Premises described in Exhibit A attached hereto. Beneficiary, however, hereby consents to the Trustor’s collection and retention of such Rents and Profits as they accrue and become payable so long as Trustor is not at such time, in default with respect to the indebtedness secured hereby, or in the performance of any covenant or agreement hereunder or hereby secured.

ARTICLE II

EVENTS OF DEFAULT

          The following shall constitute events of default (“Events of Default”) hereunder:

     2.01 Obligations, Covenants, and Agreements. A default by Trustor in the due, prompt and complete observance and performance of any obligation, covenant and agreement contained in this Deed of Trust.

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     2.02 Other Obligations. A default by Trustor in the due, prompt, and complete observance and performance of any obligation, covenant and agreement contained in the Guaranty, or the occurrence of any other Event of Default as defined by and under the Resolution, including the payment, when due of any installment of principal or interest, if any, on the Bonds.

ARTICLE III

REMEDIES

          Upon the occurrence of any Event of Default, Trustee and Beneficiary shall have the following rights and remedies subject to the rights of holders of prior encumbrances identified in Section 1.02 of this Deed of Trust:

     3.01 Possession. Upon the occurrence of any Event of Default hereunder including, without limitation, defaults in the Agreement or the Resolution, and acceleration of payment of principal of and interest on the Series A Bonds then the Beneficiary in person or by agent may, without any obligation so to do and without notice or demand upon Trustor and without releasing Trustor from any obligation hereunder or in any other agreement or instrument relating to the Obligations, including the Guaranty: (i) make any payment or do any act which Trustor has failed to make or do; (ii) enter upon, take possession of, manage and operate the Property or any part thereof; (iii) make or enforce, or, if the same be subject to modification or cancellation, modify or cancel any leases of the Property or any part thereof upon such terms or conditions as Beneficiary deems proper; (iv) obtain and evict tenants, and fix or modify rents, make repairs and alterations and do any acts which Beneficiary deems proper to protect the security hereof; and (v) with or without taking possession, in its own name or in the name of Trustor, sue for or otherwise collect and receive rents, royalties, issues, profits, revenue, income and other benefits, including those past due and unpaid, and apply the same less costs and expenses of operation and collection, including reasonable attorneys’ fees, upon the indebtedness secured hereby. The entering upon and taking possession of the Property, the collection of any rents, royalties, issues, profits, revenue, income or other benefits and the application thereof as aforesaid shall not cure or waive any default theretofore or thereafter occurring or affect any notice of default hereunder or invalidate any act done pursuant to any such notice; and, notwithstanding continuance in possession of the Property, or any part thereof, by Beneficiary, Trustee or a receiver, and the collection, receipt and application of rents, royalties, issues, profits, revenue, income or other benefits, Beneficiary shall be entitled to exercise every right provided for in this Deed of Trust or by law upon or after the occurrence of a default, including the power to direct the Trustee to exercise the power of sale. Any of the actions referred to in this Section 3.01 may be taken by Beneficiary, either in person or by agent, with or without bringing any action or proceeding, or by receiver appointed by a court and any such action may also be taken irrespective of whether any notice of default or election to sell has been given hereunder and without regard to the adequacy of the security for the indebtedness hereby secured. Further, Beneficiary, at the expense of Trustor, either by purchase, repair or construction, may from time to time maintain and restore the Property or any part thereof and complete construction uncompleted as of the date thereof and in the course of such completion may make such changes in the contemplated fixtures as Beneficiary may deem desirable and may insure the same. Beneficiary shall be entitled, without notice and to the full extent

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provided by law, to the appointment by a court having jurisdiction of a receiver to take possession of and protect the Property or any part thereof, and operate the same and collect the Rents and Profits.

     3.02 Receiver.

          (a) Beneficiary shall be entitled to the appointment of a receiver by a court having jurisdiction, to the full extent provided by law, without notice, to take possession of and protect the Property or any part thereof, and operate the same and collect the Rents and Profits, without regard to the adequacy of the security of the Property, and without regard to the enforcement by Trustee or Beneficiary of any other remedy provided herein.

          (b) Notwithstanding the appointment of any receiver, liquidator or trustee of Trustor, or of any of its property, or of the Property or any part thereof, Trustee and Beneficiary shall be entitled to retain possession and control of all property now or hereafter held under this Deed of Trust, including, but not limited to, the Rents and Profits.

     3.03 Foreclosure. Beneficiary may bring an action in any court of competent jurisdiction enforce this Deed of Trust or to enforce any of the covenants and agreements hereof.

     3.04 Power to Sell. Beneficiary may elect to cause the sale of Trustor’s interest in the Property or any part thereof to be sold as follows:

          (a) Beneficiary may proceed as if the entire Property consisted of real property in accordance with Section 3.04(d) below, or Beneficiary may elect to treat any of the Property which consists of a right in action or which is property that can be severed from the Premises or the Equipment without causing structural damage thereto as if the same were personalty, and dispose of the same in accordance with Section 3.04(c) below, separate and apart from the sale of real property, the remainder of the Property being treated as real property.

          (b) Beneficiary may cause any such sale or other disposition to be conducted immediately following the expiration of the grace period, if any, herein provided or provided in the Agreement (or immediately upon the expiration of any redemption or reinstatement period required by law) or Beneficiary may delay any such sale or other disposition for such period of time as Beneficiary deems to be in its best interest. Should Beneficiary desire that more than one such sale or other disposition be conducted, Beneficiary, may at its option, cause the same to be conducted simultaneously or successively, on the same day or at such different days or times and in such order, as Beneficiary may deem to be in its best interest.

          (c) Should Beneficiary elect to cause any of the Property to be disposed of as personalty as permitted by Section 3.04(a) above, Beneficiary may dispose of any part thereof in any manner now or hereafter permitted by the Nebraska Uniform Commercial Code or in accordance with any other remedy provided by law. Any such disposition may be conducted by an employee, attorney or agent of Beneficiary or Trustee. Any person, including, Trustor, Trustee and Beneficiary, shall be eligible to purchase any part or all of such personalty at any such disposition. Any such disposition may be either public or private as Beneficiary may elect, subject to the provisions of the Nebraska Uniform Commercial Code. Beneficiary shall have all of the rights and remedies of a secured party

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under the Nebraska Uniform Commercial Code. Expenses of retaking, holding, preparing for sale, selling or the like shall include Beneficiary’s reasonable attorney’s fees and legal expenses, and upon Beneficiary’s election to proceed under this Section 3.04(c), Trustor, upon demand of Beneficiary, shall assemble such personalty and make it available to Beneficiary at the Premises, a place which is deemed reasonably convenient to Beneficiary and Trustor. Beneficiary shall give Trustor such prior written notice of the time and place of any public sale or other disposition of such personalty or of the time at or after which any private sale or any other intended disposition is to be made as may be required by the Nebraska Uniform Commercial Code, and if such notice is sent to Trustor three (3) days prior to any intended disposition in the manner provided for the mailing of notices herein it shall constitute reasonable notice to Trustor.

          (d) Should Beneficiary elect to sell the Property or any part thereof which is real property or which Beneficiary has elected to treat as real property, upon such election, Beneficiary or Trustee shall give such notice of default and election to sell as may then be required by law. Thereafter, upon the expiration of such time and the giving of such notice of sale as may then be required by law, and without the necessity of any demand upon Trustor, Trustee, at the time and place specified in the notice of sale, shall sell the Property or any portion thereof specified by Beneficiary, at public auction to the highest bidder for cash in lawful money of the United States, subject, however, to the provisions of Section 3.04(g) hereof. For any cause it deems expedient, Trustee may, and upon request of Beneficiary shall, from time to time postpone the sale by public declaration thereof at the time and place last appointed for the sale. If the Premises consist of several lots or parcels, Beneficiary may designate the order in which such lots or parcels shall be offered for sale or sold. Any persons, including Trustor, Trustee and Beneficiary, may purchase at the sale. Upon receipt of payment, Trustee shall execute and deliver to the purchaser or purchasers a deed or deeds conveying the property so sold, but without any covenant or warranty whatsoever, express or implied, whereupon such purchaser or purchasers shall be let into immediate possession.

          (e) In the event of a sale or other disposition of the Property, or any part thereof, and in execution of a deed or other instrument of conveyance pursuant thereto, the recitals therein of facts, such as the occurrence of an Event of Default, the compliance with the provisions of any statute or Act, the giving of notice of default and notice of sale, demand that such sale should be made, postponement of sale, terms of sale, sale, purchaser, payment of purchase of such sale or disposition, shall be conclusive proof of the truth of such facts; any such deed or instrument of conveyance shall be conclusive against all persons as to such facts recited therein.

          (f) The acknowledgment contained in any deed or conveyance executed as aforesaid of the receipt of the purchase money shall be sufficient to discharge the grantee of all obligations to see to the proper application of the consideration therefor as hereinafter provided. The purchaser at any trustee’s or foreclosure sale hereunder may disaffirm any easement granted or rental or lease contract made in violation of any provision of this Deed of Trust, and may take immediate possession of the purchased portion of the Property free from, and despite the terms of, such grant of easement and rental or lease contract.

          (g) Upon the completion of any sale or sales made by Trustee or Beneficiary, as the case may be, under or by virtue of this Section 3.04, Trustee or any officer of any court empowered to do so, shall execute and deliver to the accepted purchaser or purchasers a good and sufficient

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instrument, or good and sufficient instruments, conveying, assigning and transferring all estate, right, title and interest in and to the Property and rights sold. Trustee is hereby appointed irrevocably the true and lawful attorney of assignments, transfers and deliveries of the Property or any part thereof and the rights so sold; and for that purpose Trustee may execute all necessary instruments of conveyance, assignment and transfer, and may substitute one or more persons with like power, Trustor hereby ratifying and confirming all that its said attorney or any substitute or substitutes shall lawfully do by virtue hereof. Nevertheless, Trustor, if so requested by Trustee or Beneficiary, shall ratify and confirm any such sale or sales by executing and delivering to Trustee or to such purchaser or purchasers all such instruments as may be advisable in the judgment of Trustee or Beneficiary, for the purpose as may be designated in such request. Any such sale or sales made under or by virtue of this Section 3.04, whether made under the power of sale herein granted or under or by virtue of judicial proceedings or of a judgment or decree of foreclosure and sale, shall operate to divest all of the estate, right, title, interest, claim and demand whatsoever, whether at law or in equity, of Trustor in and to the properties and rights so sold, and shall be a perpetual bar, both at law and in equity, against Trustor and any and all persons claiming or who may claim the same, or any part thereof, from, through or under Trustor.

     3.05 Rescission by Beneficiary. Beneficiary may at any time rescind the giving or filing of a notice of default pursuant hereto by executing, acknowledging and delivering to Trustee a Cancellation of Notice of Default in due form, and the exercise by Beneficiary of such right of rescission shall constitute a cancellation of any prior declaration by Beneficiary declaring all sums due hereunder and under the Agreement due and payable, but shall not effect or constitute a waiver of any default nor impair the right of Beneficiary to make other declarations, based on the same or any other Event of Default, declaring all such sums due and payable or to foreclose hereupon.

     3.06 Waiver by Trustor. Trustor hereby expressly waives any right which it may have to direct the order in which any of the Property shall be sold in the event of any sale or sales pursuant hereto.

     3.07 Application of Sales Proceeds. Unless otherwise provided by law, the purchase money, proceeds or avails of any sale made under or by virtue of this Article III, together with all other sums which then may be held by Trustee or Beneficiary under this Deed of Trust, whether under the provisions of this Article III, or otherwise, shall, after payment of the costs and expenses of the proceedings, including any sale pursuant to Section 3,04, resulting in the collection of such moneys and of the expenses, liabilities and advances incurred or made by Trustee, be paid to Paying Agent pursuant to the Resolution of the Authority dated October 24, 2003, authorizing issuance of the Bonds, for application as set forth therein.

     3.08 No Remedy Exclusive and No Waiver. No remedy herein conferred upon or reserved to Trustee or Beneficiary is intended to be exclusive of any other remedy provided in this Deed of Trust, the Guaranty, the Resolution, the Bonds or by law, but each shall be cumulative and shall be in addition to every other remedy given hereunder or now or hereafter existing at law or in equity or by statute, No delay or omission of Trustee or Beneficiary to exercise any right or power accruing upon any Event of Default shall impair any right or power or shall be construed to be a waiver of any Event of Default or any acquiescence therein; and every power and remedy given by this Deed of Trust to Trustee or Beneficiary may be exercised from time to time as often as may be deemed

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expedient by Trustee or Beneficiary. Beneficiary, by accepting payment of any sum secured hereby after its due date, or by making any payment or taking any action which, under the provisions hereof, Beneficiary is entitled but not obligated to make or take, does not waive its right to require prompt payment when due from Trustor or to declare a default for Trustor’s failure to pay or fulfill its obligations under this Deed of Trust. If there exists additional security for the performance of the obligations secured hereby, the Beneficiary, at its sole option and without limiting or affecting any of the rights or remedies hereunder, may exercise any of the rights and remedies to which it may be entitled hereunder either concurrently with whatever rights it may have in connection with such other security or in such order as it may determine.

     3.09 Surrender of Premises.

          (a) Upon the occurrence of any Event of Default and pending the exercise by Trustee or Beneficiary or their agents or attorneys of their right to exclude Trustor from all or any part of the Premises, Trustor agrees to vacate and surrender possession of the Premises to Trustee or Beneficiary, as the case may be, or to a receiver, if any, and in default thereof may be evicted by any summary action or proceeding for the recovery of possession of premises for nonpayment of rent, however designated.

          (b) In the event that there is a Trustee’s sale hereunder and if at the time of such sale Trustor or its heirs, personal representative, executor, administrator, successor or assign is occupying the Premises or any part thereof so sold, each and all shall immediately become the tenant of the purchaser at such sale, which tenancy shall be a tenancy from day to day terminable at the will of either tenant or landlord, at a reasonable rental per day based upon the value of the Premises, such rental to be due daily to said purchaser. An action of forcible detainer shall lie if the tenant holds over after a demand in writing for possession of the Premises; and this Deed of Trust and the trustee’s deed shall constitute a lease and agreement under which the tenant’s possession arose and continued.

          (c) Successor Trustor. In the event ownership of the Property or any portion thereof becomes vested in a person other than the Trustor (as herein named), Beneficiary may, without notice to the Trustor (as herein named), whether or not Beneficiary has given written consent to such change in ownership, deal with such successor or successors in interest with reference to this Deed of Trust and the indebtedness secured hereby, and in the same manner as with Trustor, without in any way compromising or discharging Trustor’s liability hereunder or under the indebtedness hereby secured.

          (d) Beneficiary’s and Trustee’s Right to Act. Should Trustor fail to make any payment or to do any act required under the terms of the Agreement or this Deed of Trust, then Beneficiary or Trustee may, without obligation so to do, and without notice to or demand upon Trustor and without releasing Trustor from any obligation thereunder,

          (i) Make any such payment or do or perform any such acts in such manner and to such extent as either Beneficiary or Trustee in its sole discretion may determine to be necessary to proper to preserve the value of the Property and/or to protect the security of this Deed of Trust; or

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          (ii) Do or perform any acts which Trustor is obligated hereunder to do or perform; or

          (iii) Pay, purchase, contest or compromise any encumbrance, charge or lien, which in the judgment of either appears to be prior or superior hereto.

In exercising any such powers or performing any such acts Beneficiary and Trustee are hereby authorized to enter upon the Property at any time for such purpose and to incur any liability and expend whatever amounts in their absolute discretion they may deem necessary therefor, including, but not limited to, the cost of evidence of title and the employment of counsel and the payment of counsel’s reasonable fees.

     3.10 Exception to Obligations of Trustee. Notwithstanding any provision in this Deed of Trust to the contrary, Trustee shall have no obligation to take title to or to obtain possession or control of the Project or Premises unless the Trustee is satisfied, in its sole discretion, that such title, control or possession will not subject Trustee to any hazardous material clean-up obligation with respect to the Project or Premises.

ARTICLE IV

CONCERNING TRUSTEE

     4.01 Liability and Acceptance. Trustee, by its acceptance hereof, covenants faithfully to perform and fulfill the trusts herein created, being liable, however, only for willful negligence or misconduct. Trustee accepts this trust when this Deed of Trust, duly executed and acknowledged, is made a matter of public record as provided by law.

     4.02 Resignation. Trustee may resign at any time upon giving thirty (30) days’ notice in writing to Trustor and to beneficiary.

     4.03 Successor Trustee. Beneficiary may remove Trustee at any time or from time to time and select a successor trustee. In the event of the death, dissolution, removal, resignation, refusal to act, or inability to act of Trustee, or in its sole discretion for any reason whatsoever, Beneficiary may, without notice and without specifying any reason therefor and without applying to any court, select and appoint a successor trustee, and all powers, rights, duties and authority of Trustee, as aforesaid, shall thereupon become vested in such successor, without any need for conveyance from any predecessor trustee. Such successor trustee shall not be required to give bond for the faithful performance of its duties unless required by Beneficiary. Such successor trustee shall be appointed by written instrument duly recorded in each county where the Premises or any part thereof are located, which appointment may be executed by an authorized agent of Beneficiary and if Beneficiary is a trust or corporation and such appointment be executed in its behalf by any single trustee or officer of such trust of corporation, such appointment shall be conclusively presumed to be executed with authority and shall be valid and sufficient without proof of any action by the trustees or Board of Directors or any superior officer of the trust or corporation. Trustor hereby ratifies and confirms

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any and all acts which the herein Trustee, or its successor or successors in this trust, shall do lawfully by virtue hereof.

     4.04 Reconveyances. Upon written request of Beneficiary stating that all sums secured hereby have been paid, and upon surrender of this Deed of Trust and the Guaranty to Trustee for cancellation and delivery to the Trustor or his successors in interest, and upon payment of its fees, Trustee shall reconvey, without warranty, the Property. The recitals in such conveyance of any matters of fact shall be conclusive proof of the truthfulness thereof. The grantee in such reconveyance may be described as “the person or persons legally entitled thereto”.

     4.05 Costs of Trustee’s Performance. Trustor shall pay all costs, fees and expenses of Trustee, its agents and counsel in connection with the performance of its duties hereunder; and Trustor shall pay all taxes (except federal and state income taxes) and other governmental charges or impositions imposed by any governmental authority upon Trustee or Beneficiary by reason of its or their interest in this Deed of Trust or the Guaranty.

ARTICLE V

MISCELLANEOUS

     5.01 Severability. In the event any one or more of the provisions contained in this Deed of Trust shall for any reason be held to be invalid, illegal or unenforceable in any respect, such invalidity, illegality or unenforceability shall not affect any other provision of this Deed of Trust, but this Deed of Trust shall be construed as if such invalid, illegal or unenforceable provision had never been contained herein or therein.

     5.02 Unsecured Debt. If the lien of this Deed of Trust is invalid or unenforceable as to any part of the debt secured hereby, or if the lien is invalid or unenforceable as to any part of the Property, the unsecured or partially secured portion of the debt shall be completely paid prior to the payment of the remaining and secured or partially secured portion of the debt and all payments made on the debt, whether voluntary or under foreclosure or other enforcement action or procedure, shall be considered to have been first paid on and applied to the full payment of that portion of the debt which is not secured or not fully secured by the lien of this Deed of Trust.

     5.03 Notices. All written notices expressly provided hereunder to be given by Beneficiary to Trustor and all notices and demands of any kind or nature whatsoever which Trustor may be required or may desire to give to or serve on Beneficiary shall be in writing and shall be served by registered or certified mail. Any such notice or demand so served by registered or certified mail shall be deposited in the United States mail, with postage thereon fully prepaid and addressed to the party so to be served at its address above stated or at such other address of which it shall have notified, in writing, the person charged with giving such notice. Service of any such notice or demand so made shall be deemed complete on the date of actual delivery as shown by the addressee’s registry or certification receipt or the expiration of the third day after the date of mailing, whichever is earlier in time.

11

     5.04 Request for Notice. Trustor hereby requests that a copy of any Notice of Default and any Notice of Sale hereunder be mailed to it at its address herein contained.

     5.05 Nonwaiver. The granting of consent by Beneficiary to any transaction as required by the terms hereunder shall not be deemed a waiver of the right to require such consent to future or successive transactions.

     5.06 Headings. The headings of the sections in this Deed of Trust are inserted solely for convenience of reference, and are not intended to govern, limit or aid in the construction of any term or provision hereof.

     5.07 Gender and Number. Whenever the context so requires, the neuter gender herein shall include the masculine or feminine or both, and the singular number shall include the plural.

     5.08 Counterparts. This Deed of Trust may be executed in any number of counterparts and each of such counterparts shall for all purposes be deemed to be an original; and all such counterparts shall together constitute but one and the same deed of trust.

     5.09 Governing Jurisdiction. This Deed of Trust shall be governed by and construed under the laws of the State of Nebraska (“Governing Jurisdiction”).

     5.10 Definition of Terms. Unless otherwise expressly stated, the term “Trustor” is used herein and includes Trustor’s successors and interests and assigns; the word “Trustee” as used herein includes Trustee’s successors in interest and assigns; and the word “Beneficiary” as used herein, includes Beneficiary’s successors in interest and assigns.

     5.11 Acceptance by Trustee. Trustee accepts this Trust when this Deed of Trust, duly executed and acknowledged, is made a public record as provided by law.

12

          The undersigned have executed this Deed of Trust and Security Agreement the day and year first hereinabove written.

TRUSTOR:
SIOUXLAND ETHANOL, LLC, a Nebraska limited liability company
By:	/s/ Tom Lynch
	Its Authorized Representative

STATE OF NEBRASKA	)
	) ss.
COUNTY OF LANCASTER	)

          The foregoing instrument was acknowledged before me this 27 day of September, 2006, by Tom Lynch, President of SIOUXLAND ETHANOL, LLC, a Nebraska limited liability company, on behalf of the company.

GENERAL NOTARY - State of Nebraska
RONDA JACKSON
My Comm. Exp. Sept. 20, 2006

(S E A L)

/s/ Ronda Jackson

Notary Public

13

EXHIBIT A

Legal Description

The land referred to is situated in the State of Nebraska, County of Dakota and is described as follows:

Tract C:

A tract of land consisting of part of the SE 1/4 of Section 27, Township 29 North, Range 7 East of the 6th P.M., Dakota County, Nebraska and more particularly described as follows: Commencing at the South 1/4 corner of Section 27, said point also being the point of Beginning; thence N00°40’00"E upon and along the West line of the SE 1/4 a distance of 33.00 feet of the North right-of-way line of Knox Road; thence continuing N00°40’00"W upon and along said West line a distance of 1005.13 feet to the intersection of said West line and the Westerly C.B. & Q Railroad R.O.W. line; thence S35°08’38"E upon and along said Westerly Railroad R.O.W. line a distance of 1236.03 feet to the intersection of said Westerly Railroad R.O.W. line and said North R.O.W. line of Knox Road; thence continuing S35°08’38"E upon and along said Westerly Railroad R.O.W. line a distance of 40.59 feet to the South line of said SE 1/4; thence N89°32’3 5"W upon and along said South line a distance of 747.05 feet to the Point of Beginning.

Tract E:

A tract of land consisting of part of the SE 1/4 of Section 27, Township 29 North, Range 7 East of the 6th P.M., Dakota County, Nebraska and more particularly described as follows: Commencing at the South 1/4 corner of Section 27; thence N00°40’00"E upon and along the West line of the SE 1/4 a distance of 1209.04 feet to the intersection of said West line and the Easterly C.B. & Q Railroad R.O.W. line. Said point also being the point of Beginning; thence continuing N00°40’00"E upon and along said west line a distance of 124.76 feet to the Westerly R.O.W. line of Highway 20; thence S35°08’38"E upon and along said Westerly Hwy 20 R.O.W. line a distance of 805.80 feet; thence S54°51’22"W upon and along said Hwy 20 R.O.W. line a distance of 73.00 feet to the intersection of Hwy 20 R.O.W. and Easterly Railroad R.O.W.; thence N35°08’38"W upon and along said Easterly Railroad R.O.W. line a distance of 704.62 feet to the Point of Beginning.

Tract B:

A tract of land consisting of part of the SW 1/4 of Section 27, Township 29 North, Range 7 East of the 6th P.M., Dakota County, Nebraska and more particularly described as follows: Commencing at the South 1/4 corner of Section 27, said point also being the point of beginning; thence on an assumed bearing of N 89°33’24"W upon and along the South line of the SW 1/4 of Section 27 a distance of 269.07 feet; thence N 00°26’36“E Perpendicular to said South line a distance of 73.00 feet; thence N 89°33’24“W parallel with said South line a distance of 30.00 feet; thence S 00°26’36“W perpendicular to said South line a distance of 73.00 feet; thence N89°33’24"W upon and along said South line a distance of 453.97 feet; thence N 00°26’36" Perpendicular to said South line a distance of 33,00 feet to the North Right-of-way line of Knox Road; thence continuing N 00°26’36“E Perpendicular to said South line a distance of 417.00 feet; thence N35°08’38"W parallel

A-1

with C.B. & Q Railroad R.O.W. line a distance of 2651.04 feet to the South R.O.W. line of 143rd Street; thence continuing N 35°08’38"W parallel with said Railroad R.O.W. line a distance of 40.23 feet to the North line of said SW 1/4; thence N89°44’23"E upon and along said North line a distance of 1167.77 feet to said C.B. & Q Railroad westerly R.O.W. line; thence S 35°08’38"E upon and along said Westerly Railroad R.O.W. line a distance of 40.23 feet to the intersection of said Westerly R.O.W. line and along said Westerly Railroad R.O.W. line a distance of 40.23 feet to the intersection of said Westerly R.O.W. line and said South R.O.W. line of 143rd Street; thence continuing S 35°08’38"E upon and along said Westerly Railroad R.O.W. line a distance of 1945.48 feet to a point on the East line of said SW 1/4; thence S 00°40’00"W upon and along said East line a distance of 1005.13 feet to said North R.O.W. line of Knox Road; thence continuing S 00°40’00"W upon and along said East line a distance of 33.00 feet to the Point of Beginning.

Tract D:

A tract of land consisting of part of the SW 1/4 of Section 27, Township 29 North, Range 7 East of the 6th P.M., Dakota County, Nebraska and more particularly described as follows: Commencing at the South 1/4 corner of Section 27; thence N 00°40’00"E upon and along the East line of the SW 1/4 a distance of 1209.04 feet to the intersection of said East line and the Easterly C.B. & Q Railroad (Right-of-Way) R.O.W. line, said point also being the point of Beginning; thence N 35°08’38"W upon and along said Westerly Hwy 20 R.O.W. line a distance of 1727.89 feet to the intersection of said Easterly Railroad R.O.W. line and 143rd Street R.O.W. line; thence S 89°44’23"W upon and along 143rd Street R.O.W. line a distance of 88.99 feet to the intersection of South 143rd R.O.W. line and Westerly Hwy 20 R.O.W. line; thence S35°08’38"E upon and along said Westerly R.O.W. line a distance of 1575.82 feet to said East line of SW 1/4; thence S 00°40’00"W upon and along said East line a distance of 124.76 feet to the Point of Beginning.

A-2

EX-10.25

Exhibit 10.25

DEBT SUBORDINATION AGREEMENT

     THIS DEBT SUBORDINATION AGREEMENT (“Agreement”) is made and entered into as of September 28, 2006, among Wells Fargo Bank, National Association, in Lincoln, Nebraska, as trustee (the “Creditor”) for the owners of the $4,030,000 Community Redevelopment Authority of the Village of Jackson, Nebraska, Tax Increment Revenue Bonds, Taxable Series 2006A (Siouxland Ethanol Plant Project) (the “Series 2006A Bonds”) pursuant to that certain Bond Resolution, dated as of July 20, 2006 (the “Bond Resolution”), and Siouxland Ethanol, LLC (“the Company”), and Farm Credit Services of America, FLCA (“FCSA”).

WITNESSETH

     WHEREAS, the Company is now and may from time to time hereafter be indebted to Creditor; and

     WHEREAS, the Company desires to obtain loans, extensions of credit or other financial accommodations from FCSA; and

     WHEREAS, FCSA is unwilling to provide such financial accommodations to the Company unless Creditor and the Company enter into this Agreement with FCSA;

     NOW, THEREFORE, in consideration of the covenants contained herein, and to induce FCSA to provide financial accommodations to or for the benefit of the Company, the parties hereto, intending to be legally bound hereby, do agree as follows:

     1. Definitions. In addition to such other terms as are elsewhere defined herein, as used in this Agreement the following terms shall have the following meanings:

     “Junior Debt” means all indebtedness, liabilities, debit balances, covenants and duties at any time or times owed by the Company to Creditor (but solely in its capacity as trustee), whether direct or indirect, absolute or contingent, secured or unsecured, due or to become due, now existing or hereafter arising, under the Subordinated Debt, together with all interest, fees, charges, expenses and attorney’s fees for which the Company is now or hereafter becomes liable to pay to Creditor under any agreement or by law.

     “Loan Agreement” means: (i) that certain Credit Agreement dated as of May 4, 2006, between FCSA and the Company; and (ii) all amendments to and restatements of each of the foregoing.

     “Subordinated Debt” means that/those certain obligations to make payments in the Redevelopment Contract, the Guaranty and the Subordinate Deed of Trust (all as defined in the Bond Resolution) or of debt service on the Series 2006A Bonds to be issued in the aggregate principal amount not to exceed $4,030,000. True and correct copies of the Redevelopment Contract, the Guaranty, the Subordinate Deed of Trust and the Bond Resolution are annexed hereto as Exhibit A. In the event this Agreement is executed and delivered prior to the execution and delivery of the Subordinated Debt, unexecuted final versions shall be provided to FCSA, and the Company agrees to provide copies of the executed documents to FCSA as soon as available and without change from the drafts delivered to FCSA without the express prior consent of the

Debt Subordination Agreement

FCSA. The Subordinated Debt does not include the Series 2006A Bonds or the obligation of the Company to pay property taxes.

     “Superior Debt” means all loans, advances, liabilities, debit balances, covenants and duties at any time or times owed by the Company to FCSA, whether direct or indirect, absolute or contingent, secured or unsecured, due or to become due, now existing or hereafter arising, including, without limitation, (i) any and all indebtedness, liabilities and obligations now or hereafter owing by the Company to FCSA under the Loan Agreement, (ii) any indebtedness, liability or obligation owing by the Company to others which FCSA may have obtained by assignment, pledge, purchase or otherwise, (iii) any and all loans made or credit extended by FCSA to the Company during the pendency of any bankruptcy case of the Company and (iv) all interest (including any interest that accrues on any of the Superior Debt during the pendency of any bankruptcy case of the Company, whether or not FCSA is authorized by 11 U.S.C. § 506 to collect such interest from the Company), fees, charges, expenses and attorneys’ fees for which the Company is now or hereafter becomes liable to pay to FCSA under any agreement or by law.

     2. Subordination. Subject to the provisions of paragraph 5 hereof, Creditor hereby postpones and subordinates all of the Junior Debt to the full and final payment and discharge of all of the Superior Debt. Without limiting the generality of the foregoing, in the event of any distribution, division or application, partial or complete, voluntary or involuntary, by operation of law or otherwise, of all or any part of the assets of the Company or the proceeds thereof to creditors of the Company or upon any indebtedness of the Company, by reason of the liquidation, dissolution or other winding up of the Company or the Company’s business, or in the event of any sale, receivership, insolvency or bankruptcy proceeding, or assignment for the benefit of creditors, or any proceeding by or against the Company for any relief under any bankruptcy or insolvency law or laws relating to the relief of the Company, readjustment of indebtedness, reorganization, compositions or extensions, then and in any such event any payment or distribution of any kind or character, either in cash, securities or other property, which shall be payable or deliverable upon or with respect to any of the Junior Debt shall be paid or delivered directly to the FCSA for application to the Superior Debt (whether or not the same is then due) until all of the Superior Debt has been fully paid and discharged. The Subordinated Debt shall at all times bear a conspicuous legend that the Junior Debt evidenced thereby is subordinated to the Superior Debt pursuant to this Agreement. The Company’s and Creditor’s books shall be marked to evidence the subordination of all of the Junior Debt to FCSA. FCSA is authorized to examine such books from time to time and to make any notations required by this Agreement. The provisions of this paragraph 2 shall remain effective and binding upon Creditor, to the full extent of the Superior Debt, even of any of the Superior Debt is avoided, equitably subordinated or nullified in any bankruptcy case of the Company.

     3. Warranties and Representations of the Company and Creditor. The Company and Creditor each hereby represents and warrants that: (a) it has not relied nor will it rely on any representation or information of any nature made by or received from FCSA or the FCSA relative to the Company in deciding to execute this Agreement; (b) Creditor is or will be the lawful owner of the Subordinated Debt as trustee for the bondholders; (c) Creditor has not heretofore assigned or transferred any of the Junior Debt, any interest therein or any collateral or security pertaining thereto other than to the bondholders; and (d) Creditor has not heretofore given any subordination in respect of the Junior Debt.

2

Debt Subordination Agreement

     4. Negative Covenants. For so long as this Agreement is in effect: (a) the Company shall not, directly or indirectly, make any payment (other than a payment permitted by paragraph 5 hereof) on account of or to satisfy all or any part of the Junior Debt; (b) Creditor shall not demand, collect or accept from the Company or any other person any payment (other than a payment permitted by paragraph 5 hereof) or collateral on account of the Junior Debt or any part thereof other than amounts on deposit under the Bond Resolution, or accelerate the maturity of the Junior Debt or realize upon or enforce any collateral securing the Junior Debt other than amounts on deposit under the Bond Resolution; (c) Creditor shall not exchange, set off or otherwise discharge any part of the Junior Debt; (d) Creditor shall not hereafter give any subordination in respect of the Junior Debt or transfer or assign any of the Junior Debt to any person other than FCSA unless the transferee or assignee thereof first agrees in writing with FCSA to be bound by the terms of this Agreement; provided, however, this shall not apply to transfers of bonds secured by, and payable from, the Junior Debt; (e) the Company shall not hereafter issue any instrument, security or other writing evidencing any part of the Junior Debt, and Creditor will not receive any such writing, except for the bonds or upon the prior written approval of the FCSA or at the request of and in the manner requested by the FCSA; (f) the Company and Creditor shall not amend, alter or modify any provision of the Subordinated Debt without the prior written consent of the FCSA; (g) Creditor shall not commence or join with any other creditors of the Company in commencing any bankruptcy, reorganization, receivership or insolvency proceeding against the Company; and (h) neither the Company nor Creditor otherwise shall take or permit any action prejudicial to or inconsistent with FCSA’s priority position over Creditor that is created by this Agreement.

     5. Permitted Payments. If and for so long as no Material Potential Default or Event of Default (as those terms are defined in the Loan Agreement) exists at the time, or would result from the making of such payment, but only upon written notice of such event from the FCSA, the Company may pay to Creditor, and Creditor may accept and retain, any regularly scheduled installments of principal of, and interest on, the Junior Debt due and owing to Creditor by the Company under the Subordinated Debt in accordance with its present tenor, but without prepayment (whether mandatory or optional other than regularly scheduled annual prepayments of principal) and without payment upon acceleration.

     6. Turnover of Prohibited Transfers. If any payment, distribution or security or the proceeds thereof are received by Creditor on account of or with respect to any of the Junior Debt other than as permitted in paragraph 5 hereof, Creditor shall forthwith deliver same to the FCSA in the form received (except for the addition of any endorsement or assignment necessary to effect a transfer of all rights therein to FCSA) for application to the Superior Debt or, at the FCSA’s option, Creditor shall pay to the FCSA the amount thereof on demand. FCSA is irrevocably authorized to supply any required endorsement or assignment which may have been omitted. Until so delivered any such payment, distribution or security shall by held by Creditor in trust for FCSA and shall not be commingled with other funds or property of Creditor.

     7. Waivers. The Company and Creditor each hereby waives any defense based on the adequacy of a remedy at law which might be asserted as a bar to the remedy of specific performance of this Agreement in any action brought therefor by FCSA. To the fullest extent permitted by law, the Company and Creditor each hereby waives: presentment, demand, protest, notice or protest, notice of default or dishonor, notice of payment or nonpayment and any and all

3

Debt Subordination Agreement

other notices and demands of any kind in connection with all instruments (whether negotiable or non-negotiable) evidencing all or any portion of the Superior Debt or the Junior Debt to which the Company or Creditor may be a party; the right to require FCSA to marshal any security, or to enforce any security interest or lien FCSA may now or hereafter have in any collateral securing the Superior Debt or to pursue any claim it may have against any guarantor of the Superior Debt, as a condition to FCSA’s entitlement to receive any payment on account of the Junior Debt; notice of the acceptance of this Agreement by FCSA, notice of any loans made, extensions granted or other action taken in reliance hereon; and all other demands and notices of every kind in connection with this Agreement, the Superior Debt or the Junior Debt. Creditor assents to any release, renewal, extension, compromise or postponement of the time of payment to the Superior Debt, to any substitution, exchange or release of collateral therefor and to the addition or release of any person primarily or secondarily liable thereon. In addition, the Company and Creditor hereby waive any claim or defense that may be available to a guarantor or surety.

     8. Subrogation. Provided that the Superior Debt has been indefeasibly finally paid and discharged and no claim of a preferential transfer or the like can be made with respect hereto, Creditor shall be subrogated to the rights of FCSA to receive payments or distributions of cash, property or securities payable or distributable on account of the Superior Debt, to the extent of all payments and distributions paid over to or for the benefit of FCSA pursuant to this Agreement. In no event, however, shall Creditor have any rights or claims against FCSA for any alleged impairment of Creditor’s subrogation rights, Creditor acknowledging that any actions taken by FCSA with respect to the Superior Debt or the Collateral are authorized and consented to by Creditor.

     9. Statement of Account. The Company and Creditor each agrees to render to the FCSA from time to time upon the FCSA’s request therefor a statement of the Company’s account with Creditor and to afford the FCSA access to the books and records of Creditor and the Company in order that the FCSA may make a full examination of the state of accounts of the Company with Creditor.

     10. Validity of Junior Debt. The provisions of this Agreement subordinating the Junior Debt are solely for the purpose of defining the relative rights of FCSA and Creditor and shall not impair, as between Creditor and the Company, the obligation of the Company, which is unconditional and absolute, to pay the Junior Debt in accordance with its terms except as payment thereof may be postponed in accordance with this Agreement.

     11. Indulgences Not Waivers. Neither the failure nor any delay on the part of FCSA to exercise any right, remedy, power or privilege hereunder shall operate as a waiver thereof or give rise to an estoppel, nor be construed as an agreement to modify the terms of this Agreement, nor shall any single or partial exercise of any right, remedy, power or privilege with respect to any occurrence be construed as a waiver of such right, remedy, power or privilege with respect to any other occurrence. No waiver by a party hereunder shall be effective unless it is in writing and signed by the party making such waiver, and then only to the extent specifically stated in such writing.

     12. Duration. This Agreement shall become effective when executed by the Company and Creditor and accepted by FCSA, and, when so accepted, shall constitute a

4

Debt Subordination Agreement

continuing agreement of subordination, and shall remain in effect until all of the Superior Debt has been paid and all instruments and agreements at any time evidencing or securing the whole or any part of the Superior Debt have been terminated. FCSA may, without notice to Creditor, extend or continue credit and make other financial accommodations to or for the account of the Company in reliance upon this Agreement.

     13. Default and Enforcement. If any representation or warranty in this Agreement or in any instrument evidencing or securing the Superior Debt proves to have been materially false when made, or, in the event of a breach by either the Company or Creditor in the performance of any of the terms of this Agreement or any instrument or agreement evidencing or securing the Superior Debt, all of the Superior Debt shall, at the option of FCSA, become immediately due and payable without presentment, demand, protest, or notice of any kind, notwithstanding any time or credit otherwise allowed. At any time Creditor fails to comply with any provision of this Agreement that is applicable to Creditor, FCSA may demand specific performance of this Agreement, whether or not the Company has complied with this Agreement, and may exercise any other remedy available at law or equity. Without limiting the generality of the foregoing, if Creditor, in violation of this Agreement, shall institute or participate in any action suit or proceeding against the Company, the Company may interpose this Agreement as a defense and FCSA is irrevocably authorized to intervene and interpose such defense in the Company’s name. If Creditor attempts to enforce or realize upon any collateral securing the Junior Debt in violation of this Agreement, the Company or FCSA (in the Company’s or FCSA’s name) may by virtue of this Agreement restrain such realization or enforcement.

     14. Notices. All notices, requests, demands, and other communications required or permitted under this Agreement or by law shall be in writing and shall be deemed to have been duly given, made and received when delivered against receipt, or when received by facsimile at the office of the noticed party or on the day after deposit in the United States mails, postage prepaid, addressed as set forth below:

(a)	If to FCSA:
		5015 S. 118th Street
		Omaha, NE 68137
	Attention:	Shane Frahm, Vice President
	Fax No.:
(b)	If to Creditor:	Wells Fargo Bank, National Association, as trustee
		Corporate Trust Department
		1248 ‘O’ Street
		Lincoln, Nebraska 68508
	Attention:	Chad Shirk
	Fax No.:	402.434.4612

5

Debt Subordination Agreement

(c)	If to Company:	Siouxland Ethanol, LLC
		110 East Elk Street
		Jackson, NE 68743
	Attention:	Chairman
	Fax No.:	402.632.2676

     Any addressee may alter the address to which communications are to be sent by giving notice of such change of address in conformity with the provisions of this paragraph for the giving of notice.

     15. FCSA’s Duties Limited. The rights granted to FCSA in this Agreement are solely for its protection and nothing herein contained imposes on FCSA any duties with respect to any property either of the Company or of Creditor heretofore or hereafter received by FCSA beyond reasonable care in the custody and preservation of such property while in FCSA’s possession. FCSA has no duty to preserve rights against prior parties on any instrument or chattel paper received from the Company or Creditor as collateral security for the Superior Debt or any portion thereof.

     16. Authority. The Company and Creditor represent and warrant that they have authority to enter into this Agreement and that the person signing for the Company is authorized and directed to do so.

     17. Entire Agreement. This Agreement constitutes and expresses the entire understanding between the parties hereto with respect to the subject matter hereof, and supersedes all prior agreements and understandings, inducements or conditions, whether express or implied, oral or written. Neither this Agreement nor any portion or provision hereof may be changed, waived or amended orally or in any manner other than by an agreement in writing signed by FCSA, the Company and Creditor.

     18. Additional Documentation. The Company and Creditor shall execute and deliver to the FCSA such further instruments and shall take such further action as the FCSA may at any time or times reasonably request in order to carry out the provisions and intent of this Agreement.

     19. Successors and Assigns. This Agreement shall inure to the benefit of FCSA, its successors and assigns, and shall be binding upon both the Company and Creditor and their respective heirs, executors, successors and assigns. Any person or entity whose loans or advances to the Company hereafter are used to refinance and pay indefeasibly in full the Superior Debt shall be deemed for all purposes hereof to be the successor to FCSA, and from and after the date of any such refinancing in satisfaction in full of the Superior Debt such person or entity shall be deemed a party hereto in the place and stead of FCSA as if such person or entity had been the original signatory hereto, and all loans, advances, liabilities, debit balances, covenants and duties at any time or times owed by the Company to such successor to FCSA, whether direct or indirect, absolute or contingent, secured or unsecured, due or to become due, then existing or thereafter arising, including any renewals, extensions, modifications, or

6

Debt Subordination Agreement

replacements of any of the foregoing, shall be deemed for all purposes hereunder to constitute and be Superior Debt.

     20. Defects Waived. This Agreement is effective notwithstanding any defect in the validity or enforceability of any instrument or document at any time evidencing or securing the whole or any part of the Superior Debt.

     21. Governing Law. The validity, construction and enforcement of this Agreement shall be governed by the internal laws of the State of Nebraska.

     22. Severability. The provisions of this Agreement are independent of and separable from each other. If any provision hereof shall for any reason be held invalid or unenforceable, it is the intent of the parties that such invalidity or unenforceability shall not affect the validity or enforceability of any other provision hereof, and that this Agreement shall be construed as if such invalid or unenforceable provision had never been contained herein.

     23. Execution and Counterparts. This Agreement may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed to be an original and all of which counterparts taken together shall constitute but one and the same instrument. In proving this Agreement in any judicial proceeding, it shall not be necessary to produce or account for more than one such counterpart signed by the party against whom such enforcement is sought.

     24. Consent to the Subordinated Debt. For the purposes of Sections 7.7, 7.8 and 7.9 of the Loan Agreement and any supplement to the Loan Agreement, FCSA hereby consents and agrees in writing to the incurrence of debt by the Company, and the security therefor, represented by the Subordinated Debt, This Agreement is the agreement for subordinating debt, and it conforms to the requirements set out in Section 7.10 of the Loan Agreement.

7

Debt Subordination Agreement

     IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be signed, sealed and delivered as of the date shown above.

ATTEST:	Siouxland Ethanol, LLC
/s/ Douglas Garwood	By:	/s/ Tom Lynch
Secretary
	Title:	President
[CORPORATE SEAL]

(Signature Page to Debt Subordination Agreement)

S-1

Debt Subordination Agreement

ATTEST:	Wells Fargo Bank, National Association, as trustee
/s/ Richard K. Debuse II	By:	/s/ Chad W. Shirk
Vice President
	Title:	Vice President
[CORPORATE SEAL]
???

(Signature Page to Debt Subordination Agreement)

S-2

Debt Subordination Agreement

Farm Credit Services of America, FLCA

By:	/s/ Shane Frahn
Title:	Vice President

(Signature Page to Debt Subordination Agreement)

S-3

EX-31.1

Exhibit 31.1

CERTIFICATION PURSUANT TO 17 CFR 240.13(a)-14(a)
(SECTION 302 CERTIFICATION)

I, Tom Lynch, certify that:

1.	I have reviewed this annual report on Form 10-KSB of Siouxland Ethanol, LLC;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of Siouxland Ethanol, LLC, as of, and for, the periods presented in this report;
4.	Siouxland Ethanol, LLC’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for Siouxland Ethanol, LLC, and have:

a)	Designed such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to Siouxland Ethanol, LLC, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)	Evaluated the effectiveness of Siouxland Ethanol, LLC’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
c)	Disclosed in this report any changes in Siouxland Ethanol, LLC’s internal control over financial reporting that occurred during Siouxland Ethanol, LLC’s most recent fiscal year that has materially affected, or is reasonably likely to materially affect, Siouxland Ethanol, LLC’s internal control over financial reporting.

5 Siouxland Ethanol, LLC’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to Siouxland Ethanol, LLC’s auditors and the audit committee of Siouxland Ethanol, LLC’s board of directors (or persons performing the equivalent functions):

a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect Siouxland Ethanol, LLC’s ability to record, process, summarize and report financial information; and
b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in Siouxland Ethanol, LLC’s internal controls over financial reporting.

Date: December 22, 2006	/s/ Tom Lynch
	Tom Lynch, President (Principal Executive Officer)

EX-31.2

Exhibit 31.2

CERTIFICATION PURSUANT TO 17 CFR 240.13(a)-14(a)
(SECTION 302 CERTIFICATION)

I, John Kingsbury, certify that:

1.	I have reviewed this annual report on Form 10-KSB of Siouxland Ethanol, LLC;
2.	Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;
3.	Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of Siouxland Ethanol, LLC, as of, and for, the periods presented in this report;
4.	Siouxland Ethanol, LLC’s other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for Siouxland Ethanol, LLC, and have:

a)	Designed such disclosure controls and procedures or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to Siouxland Ethanol, LLC, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;
b)	Evaluated the effectiveness of Siouxland Ethanol, LLC’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and
c)	Disclosed in this report any changes in Siouxland Ethanol, LLC’s internal control over financial reporting that occurred during Siouxland Ethanol, LLC’s most recent fiscal year that has materially affected, or is reasonably likely to materially affect, Siouxland Ethanol, LLC’s internal control over financial reporting.

5 Siouxland Ethanol, LLC’s other certifying officers and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to Siouxland Ethanol, LLC’s auditors and the audit committee of Siouxland Ethanol, LLC’s board of directors (or persons performing the equivalent functions):

a)	All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect Siouxland Ethanol, LLC’s ability to record, process, summarize and report financial information; and
b)	Any fraud, whether or not material, that involves management or other employees who have a significant role in Siouxland Ethanol, LLC’s internal controls over financial reporting.

Date: December 22, 2006	/s/ John Kingsbury
	John Kingsbury, Treasurer (Principal Financial Officer)

EX-32.1

Exhibit 32.1

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     In connection with the annual report on Form 10-KSB of Siouxland Ethanol, LLC (the “Company”) for the period ended September 30, 2006, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, Tom Lynch, Principal Executive Officer, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ Tom Lynch

Tom Lynch, President and Chief Executive Officer

Dated: December 22, 2006

EX-32.2

Exhibit 32.2

CERTIFICATION PURSUANT TO 18 U.S.C. SECTION 1350
AS ADOPTED PURSUANT TO SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002

     In connection with the annual report on Form 10-KSB of Siouxland Ethanol, LLC (the “Company”) for the period ended September 30, 2006, as filed with the Securities and Exchange Commission on the date hereof (the “Report”), I, John Kingsbury, Principal Financial Officer, certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that:

1. The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934, as amended; and

2. The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.

/s/ John Kingsbury

John Kingsbury, Treasurer and Chief Financial Officer

Dated: December 22, 2006