Exhibit 10.18


                                CONVERTIBLE NOTE

$12,000,000.00                                                       May 2, 2007

     1. FOR VALUE  RECEIVED,  SOUTHWEST  IOWA  RENEWABLE  ENERGY,  LLC,  an Iowa
limited liability company (the "Borrower"),  hereby promises to pay to the order
of MONUMENTAL LIFE INSURANCE  COMPANY (the "Bank"),  the principal sum of Twelve
Million and  No/100ths  ($12,000,000.00)  Dollars,  or so much thereof as may be
advanced  to, or for the  benefit  of, the  Borrower  and be  outstanding,  with
interest  thereon,  to be  computed  on  each  advance  from  the  date  of  its
disbursement  as set forth herein  pursuant to that certain Credit  Agreement of
even  date  herewith  by and  between  the  Borrower,  the  Bank  and the  other
commercial, banking or financial institutions from time to time parties thereto,
and  AgStar  Financial  Services,  PCA,  as agent  (the  "Agent")  (as it may be
amended,  modified,  supplemented,  extended or restated from time to time,  the
"Credit  Agreement"),  and which remains  unpaid,  in lawful money of the United
States and immediately available funds. This Convertible Note is issued pursuant
to the terms and  provisions  of the Credit  Agreement and is entitled to all of
the benefits  provided for in the Credit  Agreement.  All capitalized terms used
and not defined  herein shall have the  meanings  assigned to them in the Credit
Agreement.

     2. The outstanding  principal  balance of this  Convertible Note shall bear
interest at a variable rate determined by Agent to be 315 basis points above the
LIBOR Rate in effect on the date of the first  Advance  made to  Borrower  under
this Convertible Note. Notwithstanding the foregoing, the rate of interest under
this Convertible Note may be adjusted by Agent pursuant to the provisions of the
Credit  Agreement and this  Convertible  Note. On the Conversion Date, a portion
not to exceed 50% of the  outstanding  principal  balance of all  Advances  made
under this  Convertible  Note may at  Borrower's  option be converted to a fixed
rate of interest at a rate acceptable to Agent in its sole reasonable discretion
pursuant to the terms and conditions of the Credit Agreement.

     3. The "LIBOR Rate" (London Interbank Offered Rate) means the rate (rounded
upward  to  the  nearest   sixteenth  and  adjusted  for  reserves  required  on
Eurocurrency  Liabilities  (as  hereinafter  defined)  for banks  subject to FRB
Regulation D (as  hereinafter  defined) or required by any other  federal law or
regulation), quoted by the British Bankers Association (the "BBA") at 11:00 a.m.
London time two Banking Days (as hereinafter defined) before the commencement of
the  Interest  Period for the  offering  of U.S.  Dollar  deposits in the London
interbank  market for an Interest Period of one month, as published by Bloomberg
or another major information  vendor listed on BBA's official website.  "Banking
Day"  shall mean a day on which  Agent is open for  business,  dealings  in U.S.
Dollar deposits are being carried out in the London interbank market,  and banks
are open for  business  in New York  City  and  London,  England.  "Eurocurrency
Liabilities"  has the meaning as set forth in FRB Regulation D. "FRB  Regulation
D" means  Regulation D as  promulgated  by the Board of Governors of the Federal
Reserve System, 12 C.F.R. Part 204, as amended from time to time.

     4. The rate of interest due hereunder  shall  initially be determined as of
the date hereof and shall  thereafter be adjusted,  as and when,  the LIBOR Rate
changes.  All such  adjustments to the rate of interest shall be made and become
effective as of the first day of the month  following  the date of any change in
the  LIBOR  Rate  and  shall  remain  in  effect  until  and  including  the day
immediately  preceding the next such adjustment (each such day hereinafter

being referred to as an "Adjustment  Date").  All such  adjustments to said rate
shall be made and become  effective as of the Adjustment  Date, and said rate as
adjusted  shall  remain  in  effect  until  and  including  the day  immediately
preceding the next Adjustment Date.  Interest hereunder shall be computed on the
basis of a year of three hundred  sixty-five  (365) days, but charged for actual
days principal is outstanding.

     5.  Advances  may  only be made  under  this  Convertible  Note  until  the
Conversion  Date  after  which no further  Advances  may be made  hereunder.  No
amounts may be readvanced under this Convertible  Note. Any principal  repayment
by the Borrower will reduce the Bank's commitment on the Construction Loan.

     6.  Prior  to  the  Conversion   Date,  all  interest  accrued  under  this
Convertible Note shall be payable monthly,  on the first day of each month (each
such date, a "Monthly  Payment  Date"),  commencing on the first Monthly Payment
Date  following  the date on which  the first  Advance  is made  hereunder,  and
continuing on each Monthly Payment Date thereafter until the Conversion Date. On
the Conversion Date, all outstanding accrued interest shall be paid in full.

     7. On the Conversion Date, the remaining  outstanding  principal balance of
this note shall be converted  into a Term Loan pursuant to the Credit  Agreement
and this Convertible Note.

     8. Subject to the terms and conditions of the Credit  Agreement,  following
the Conversion Date, the portion of the Term Loan that has not been converted to
a Fixed Rate Loan shall bear interest at a variable rate equal to the LIBOR Rate
plus 295 basis points or as otherwise provided in the Credit Agreement.

     9. The  Borrower  shall  have the  option to  convert a portion of the loan
evidenced  by this  Note into a Fixed  Rate  Loan,  as  provided  in the  Credit
Agreement,  which  shall bear  interest  at a rate equal to 275 basis  points in
excess  of a  known  fixed  rate  benchmark  rate  as set  forth  in the  Credit
Agreement,  which is in effect on the  Conversion  Date,  or such  other rate of
interest as agreed upon by the Agent and  Borrower.  Should the  Borrower  elect
such  fixed  rate  option,  such rate of  interest  shall not be  subject to any
adjustments as provided for in the Credit Agreement.

     10.  Beginning on the first (1st) day of the month  following  the month in
which the Conversion Date occurs,  and continuing on the first (1st) day of each
succeeding  month  thereafter until the seventh month after the Conversion Date,
the Borrower  shall make  monthly  payments of accrued  interest  under the Term
Loan.  Beginning  on the first  (1st) day of the  seventh  month  following  the
Conversion Date (the "Amortization Date"), and continuing on the first (1st) day
of each succeeding  month thereafter until the Maturity Date, the Borrower shall
make equal monthly payments of principal and accrued interest in such amounts as
would be required to fully amortize the entire outstanding  principal balance of
the Term Loan,  together  with accrued  interest  thereon,  over a period of 114
months from the Amortization Date. The outstanding  principal balance,  together
with all accrued interest,  if not paid sooner, shall be due and payable in full
on the Maturity  Date.  Following the  Conversion  Date,  and in addition to all
other payments of principal and interest  required  under the Credit  Agreement,
the  Borrower  shall  annually  remit to Agent for the  account  of the Bank the
Excess  Cash  Flow  Payment  pursuant  to terms  and  conditions  of the  Credit
Agreement.

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     11. The outstanding  principal  balance  hereof,  together with all accrued
interest,  if not paid  sooner,  shall be due and  payable  in full on the fifth
(5th) annual anniversary of the Conversion Date (the "Maturity Date").

     12. All payments and prepayments  shall, at the option of the Agent for the
account of the Bank, be applied first to any costs of collection,  second to any
late charges, third to accrued interest and the remainder thereof to principal.

     13. This  Convertible Note may be prepaid at any time, at the option of the
Borrower, either in whole or in part, subject to the obligations of the Borrower
to  compensate  the Bank  for any  loss,  cost or  expense  as a result  of such
prepayment  as set  forth in the  Credit  Agreement.  This  Convertible  Note is
subject to mandatory prepayment,  at the option of the Agent, as provided in the
Credit Agreement.

     14.  In  addition  to the  rights  and  remedies  set  forth in the  Credit
Agreement:  (i) if the Borrower fails to make any payment to Bank when due under
this Convertible Note, then at Agent's option in each instance,  such obligation
or  payment  shall  bear  interest  from the date due to the date paid at 2% per
annum in excess of the rate of interest  that would  otherwise be  applicable to
such obligation or payment under this Convertible Note; (ii) upon the occurrence
and during the  continuance of an Event of Default  beyond any  applicable  cure
period,  if any, at Agent's option in each instance,  the unpaid  balances under
this  Convertible Note shall bear interest from the date of the Event of Default
or such later date as Agent shall elect at 2% per annum in excess of the rate(s)
of  interest  that  would  otherwise  be in  effect  under  the  terms  of  this
Convertible  Note;  (iii)  after  the  Maturity  Date,   whether  by  reason  of
acceleration or otherwise, the unpaid principal balance of this Convertible Note
(including without  limitation,  principal,  interest,  fees and expenses) shall
automatically  bear  interest  at 2% per annum in excess of the rate of interest
that would otherwise be in effect under this Convertible Note.  Interest payable
at the  Default  Rate  shall be  payable  from time to time on demand or, if not
sooner demanded, on the last day of each calendar month.

     15. If the Borrower fails to make any payment to Agent within ten (10) days
of the due date thereof,  the Borrower shall, in addition to such amount,  pay a
late charge equal to five percent (5%) of the amount of such payment.

     16.  This  Convertible  Note is secured  by,  among  other  instruments,  a
Mortgage, Security Agreement and Financing Statement covering various parcels of
real property,  fixtures, and personal property located in Pottawattamie County,
Iowa. In the event any such security is found to be invalid for whatever  reason
in  accordance  with the terms of the Credit  Agreement  such  invalidity  shall
constitute an event of default  hereunder.  All of the  agreements,  conditions,
covenants,  provisions,  and  stipulations  contained  in the  Mortgage,  or any
instrument  securing  this  Convertible  Note  are  hereby  made a part  of this
Convertible  Note to the same  extent  and with the same  force and effect as if
they were fully set forth  herein.  It is agreed  that time is of the essence of
this Convertible Note.

     17. Upon the  occurrence  at any time of an Event of Default or at any time
thereafter,  the  outstanding  principal  balance  hereof plus accrued  interest
hereon plus all other amounts due hereunder  shall,  at the option of the Agent,
be  immediately  due and  payable,  without  notice or

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demand and Agent shall be entitled to  exercise  all  remedies  provided in this
Convertible Note, the Credit Agreement or any of the Loan Documents.

     18. Upon the  occurrence  at any time of an Event of Default or at any time
thereafter,  the Banks  shall have the right to set off any and all  amounts due
hereunder by the Borrower to the Banks against any indebtedness or obligation of
the Banks to the Borrower.

     19. The Borrower promises to pay all reasonable costs of collection of this
Convertible Note, including, but not limited to, reasonable attorneys' fees paid
or incurred by the Agent on account of such  collection,  whether or not suit is
filed with  respect  thereto and whether or not such costs are paid or incurred,
or to be paid or incurred, prior to or after the entry of judgment.

     20. Demand,  presentment,  protest and notice of nonpayment and dishonor of
this Construction Note are hereby waived.

     21. This  Convertible Note shall be governed by and construed in accordance
with the laws of the State of Minnesota.

     22. The Borrower  hereby  irrevocably  submits to the  jurisdiction  of any
Minnesota state court or federal court over any action or proceeding arising out
of or relating to this Note, the Credit Agreement and any instrument,  agreement
or document  related  hereto or thereto,  and the  Borrower  hereby  irrevocably
agrees that all claims in respect of such action or proceeding  may be heard and
determined  in such  Minnesota  state or  federal  court.  The  Borrower  hereby
irrevocably  waives, to the fullest extent it may effectively do so, the defense
of an  inconvenient  forum to the  maintenance  of such  action  or  proceeding.
Nothing in this  Convertible  Note shall  affect the right of the Agent to bring
any action or  proceeding  against the Borrower or its property in the courts of
any other jurisdiction to the extent permitted by law.


                                   SOUTHWEST IOWA RENEWABLE  ENERGY, LLC,
                                   an Iowa limited  liability
                                   company


                                   By    /s/ Mark Drake
                                      -----------------------------------------
                                           Mark Drake
                                           Its: General Manager


                                   By    /s/ Karol King
                                      -----------------------------------------
                                           Karol King
                                           Its: Board Chairman



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