UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION
                             Washington, D.C. 20549

                                   FORM 10 / A

                   GENERAL FORM FOR REGISTRATION OF SECURITIES
               Pursuant to Section 12(b) or (g) of The Securities
                              Exchange Act of 1934


                      Southwest Iowa Renewable Energy, LLC
                      ------------------------------------
             (Exact name of registrant as specified in its charter)

              Iowa                                   20-2735046
              ----                                   ----------
 (State or other jurisdiction of        (I.R.S. Employer Identification No.)
incorporation or organization)

2101 42nd Avenue, Council Bluffs, Iowa                     51501-8409
--------------------------------------                     ----------
(Address of principal executive offices)                    (Zip code)

Registrant's phone number, including area code:        (712) 366-0392

Securities to be registered pursuant to Section 12(b) of the Act:

   Title of each class                       Name of each exchange on which
   to be so registered                       each class is to be registered
----------------------------                 ------------------------------

Securities to be registered pursuant to Section 12(g) of the Act:

                                 Series A Units
                                 --------------
                                (Title of class)

Indicate by check mark whether the registrant is a large  accelerated  filer, an
accelerated filer, a non-accelerated  filer, or a smaller reporting company. See
the definitions of "large accelerated  filer,"  "accelerated filer" and "smaller
reporting company" in Rule 12b-2 of the Exchange Act. (Check one):

Large accelerated filer [ ]                              Accelerated filer [ ]
Non-accelerated filer [ ]                        Smaller reporting company |X|

                                TABLE OF CONTENTS

Item Number          Item Matter                                                             Page Number

Item 1.              Business.                                                                    1

Item 1A.             Risk Factors.                                                               17

Item 2.              Financial Information.                                                      32

Item 3.              Properties.                                                                 44

Item 4.              Security Ownership of Certain Beneficial Owners and Management.             44

Item 5.              Directors and Executive Officers.                                           45

Item 6.              Executive Compensation.                                                     48

Item 7.              Certain Relationships and Related Transactions, and Director Independence.  50

Item 8.              Legal Proceedings.                                                          53

Item 9.              Market Price of and Dividends on the Registrant's Common Equity and         53
                     Related Stockholder Matters.

Item 10.             Recent Sales of Unregistered Securities.                                    54

Item 11.             Description of Registrant's Securities to be Registered.                    55

Item 12.             Indemnification of Directors and Officers.                                  56

Item 13.             Financial Statements and Supplementary Data.                                56

Item 14.             Change in and Disagreements with Accountants on Accounting and              56
                     Financial Disclosure.

Item 15.             Financial Statements and Exhibits.                                          57


                                      (i)

                           FORWARD LOOKING STATEMENTS

     This  Registration  statement  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:

     o    Overcapacity in the ethanol industry;
     o    Our ability to obtain any  additional  equity  financing  which may be
          required to complete plant  construction and commence  operations,  or
          our inability to fulfill our debt financing covenants;
     o    Changes in our business strategy,  capital improvements or development
          plans;
     o    Construction  delays and technical  difficulties in  constructing  the
          plant;
     o    Changes in the environmental  regulations that apply to our plant site
          and operations;
     o    Our ability to hire and retain key  employees for the operation of the
          plant;
     o    Changes in general  economic  conditions or the  occurrence of certain
          events  causing  an  economic  impact  in  the  agricultural,  oil  or
          automobile industries;
     o    Changes  in the  availability  and  price of  electricity,  steam  and
          natural gas;
     o    Changes in federal and/or state laws (including the elimination of any
          federal and/or state ethanol tax incentives);
     o    Changes and advances in ethanol production technology; and competition
          from alternative fuel additives.

     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 Registration  statement. We are not under any duty
to  update  the  forward-looking   statements  contained  in  this  Registration
statement. 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
Registration  statement and the documents that we reference in this Registration
statement 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.

Item 1. Business.

General

     Southwest Iowa Renewable  Energy,  LLC (the  "Company,"  "we" or "us") is a
development  stage Iowa limited  liability company which was formed on March 28,
2005 to  develop,  construct,  own and  operate a 110  million  gallon  dry mill
corn-based ethanol plant near Council Bluffs, Iowa (the "Facility").  Based upon
engineering  specifications from ICM, Inc. ("ICM"), our primary constructor,  we
expect the Facility to process  approximately  39.3 million  bushels of corn per
year into 110 million  gallons of denatured fuel grade ethanol,  300,000 tons of
distillers' dry grains with solubles ("DDGS") and 50,000 tons of wet distillers'
grains with soluble ("WDGS," together with DDGS,  "Distillers Grains"). The fuel
grade ethanol will be sold in limited  markets  throughout the United States and
Distillers  Grains sold in  surrounding  communities  in  southwestern  Iowa and
southeastern Nebraska.

     Our Facility is located in Pottawattamie County in southwestern Iowa. It is
near two major interstate  highways,  within a half a mile of the Missouri River
and will have  access to five major rail  carriers.  This  location  is in close
proximity to raw materials and product market access.  The Facility will receive
corn and chemical deliveries primarily by truck but will be able to utilize rail
delivery if  necessary.  The site has access to water from ground wells and from
the Missouri  river.  In addition to close  proximity to the Facility's  primary
energy source,  steam, there are two natural gas providers available,  both with
infrastructure immediately accessible.

     To execute our business plan, we raised capital  through two  offerings--an
initial  seed round in the fourth  quarter of 2005 and a secondary  round in the
first quarter of 2006--and on May 2, 2007, we entered into a $126,000,000 credit


                                       1

facility (as amended,  the "Credit  Agreement") with AgStar Financial  Services,
PCA  ("Agent"),  as agent  for a  syndicate  group of  lenders  ("Lenders").  As
discussed in more detail below under Item 2. Financial Information--Management's
Discussion and Analysis of Financial Condition and Results of Operations--Recent
Developments,  effective  March 7,  2008,  we amended  the terms of our  primary
lending  agreements,  obtained a bridge loan in the maximum  principal amount of
$36,000,000  (the "Bridge Loan") from Commerce Bank, N.A. (the "Bridge  Lender")
and entered into  arrangements with the Bridge Lender and our key equity holders
and  operational  partners,  ICM and Bunge North  America,  Inc. (a wholly owned
subsidiary of Bunge Limited, a  publicly-traded,  global  agribusiness  company)
("Bunge"),  in order to resolve a construction  budget shortfall of $34,000,000.
Agent had  previously  informed us that we would not be able to borrow under the
Credit Agreement until the shortfall was resolved. The shortfall also led ICM to
reduce  construction  activities until it was resolved,  which has resulted in a
delay in the construction of the Facility.  Additionally, such shortfall, though
now resolved,  caused our independent  auditors to express concern regarding our
ability to continue  as a going  concern in  connection  with their audit of our
financial statements for the period ending September 30, 2007.

     As  security  for the  Bridge  Loan,  Bunge has  caused its bank to issue a
letter of credit in the amount equal to 76% of the maximum  principal  amount of
the Bridge  Loan in favor of the Bridge  Lender (the  "Bunge  LC"),  and ICM has
caused its lender to  similarly  issue a letter of credit in the amount equal to
24% of the  maximum  principal  amount of the Bridge Loan in favor of the Bridge
Lender (the "ICM LC" and, together with the Bunge LC, the "LCs").

     Effective  March 7, 2008,  we have  entered  into a Series C Unit  Issuance
Agreement  with ICM (the  "Series  C  Agreement")  and a Series E Unit  Issuance
Agreement  with  Bunge (the  "Series E  Agreement",  together  with the Series C
Agreement,  the "Unit Issuance  Agreements") in connection with their respective
issuances of the LCs. The Unit Issuance Agreements provide that the Company will
use its best  efforts to raise  funds  through a  subsequent  private  placement
offering  of Units (the  "Private  Placement"),  or such other form of equity or
debt  financing as the Company's  Board of Directors may deem  necessary,  in an
amount sufficient to pay off the Bridge Loan in full prior to maturity. Although
we  anticipate  that funds  obtained  from the Private  Placement  or such other
equity or debt financing will enable us to pay off the Bridge Loan in full prior
to maturity,  in the event that the LCs are drawn upon as discussed  above or if
Bunge or ICM make any other  payment to the Bridge  Lender that reduces  amounts
owed by the Company under the Bridge Loan (each, a "Bridge Loan  Payment"),  the
Unit Issuance Agreements provide that we will immediately reimburse Bunge and/or
ICM, as applicable,  for the amount of such Bridge Loan Payment by issuing Units
to Bunge and ICM, as further described below.

     Under the Unit Issuance Agreements,  if Bunge and/or ICM make a Bridge Loan
Payment,  the  Company  will,  in the case of a Bridge  Loan  Payment  by Bunge,
immediately  issue  Series E Units to Bunge,  and,  in the case of a Bridge Loan
Payment by ICM, immediately issue Series C Units to ICM, in each case based on a
Unit price that is equal to the lesser of $3,000 or one-half (1/2) of the lowest
purchase price paid by any party for a Unit as part of the Private Placement.

     The foregoing Unit price was calculated  such that any issuance of Units to
Bunge and/or ICM pursuant to the Unit Issuance  Agreements as reimbursement  for
any Bridge  Loan  Payment  would be at a 50%  discount  to the price per Unit of
$6,000  actually paid by Bunge and ICM to acquire the Units that they  presently
hold (or, if a lesser  amount,  the lowest  per-Unit  price paid by any party as
part of the  Private  Placement).  This  discounted  Unit price is  intended  to
provide an economic  incentive  for the Company to obtain  sufficient  equity to
replace the Bridge Loan from parties  other than Bunge and ICM as the  preferred
alternative  to Bunge or ICM making any Bridge Loan  Payments and is  consistent
with  the  intent  of the  parties  that  neither  Bunge or ICM  increase  their
respective Unit ownership beyond present levels.

     We have retained an  investment  banking firm to assist us in obtaining the
additional  equity to replace the Bridge Loan.  While the Bridge Loan is not due
until  March 1, 2009,  our goal is to raise  sufficient  equity to  replace  the
Bridge  Loan  as  soon  as  possible.  Initially,  we are  seeking  one or  more
institutional  investors to provide the  additional  equity.  The Board may also
determine  to make an  offering  to  existing  Members  and other  investors  to
compliment the additional institutional equity.

     To the  extent we issue  additional  Units to Bunge  and/or ICM in order to
satisfy our reimbursement  obligations under the Unit Issuance  Agreements,  the
ownership  interests of the Company's Members would be diluted,  as described in
the following  example.  If (i) the maximum  principal amount of the Bridge Loan
were drawn ($36,000,000),  (ii) Bunge and ICM each made their respective maximum
Bridge  Loan  Payments,  and (iii) the  Company  did not issue any equity to any
other  party  (thereby  setting  the  issuance  price  under  the Unit  Issuance
Agreements  at $3,000 per Unit),  then the  Company  would be  required to issue
9,120  Series E Units to Bunge and 2,880 Series C Units to ICM.  Such  issuances
would increase the Company's total outstanding Units from 13,139 to 25,139.  The
dilutive  effect of such  issuances  on a Member  holding  100 Units would be to
reduce such Member's percentage interest in the Company from 0.761% to 0.398%.

     Information  respecting our losses, assets, and other financial information
is contained below under Item 15 "Financial Statements."

Primary Contractors

     We have entered into  contracts  with various  contractors to construct the
Facility,  though our primary contractors are ICM, Todd & Sargent, Inc. ("T&S"),
and HGM Associates,  Inc. ("HGM").  Below are summaries of the contracts we have
with these three parties.

     On September  25, 2006,  we entered  into an  Agreement  Between  Owner and
Design/Builder  on the Basis of Stipulated  Price with ICM (the "ICM Contract"),
which provides that ICM will design and construct a dry mill fuel-grade  ethanol
plant,  capable of producing 110 million gallons of denatured fuel-grade ethanol
per  year  and  338,000  tons  of  DDGS.  For  such  services  we  will  pay ICM
approximately  $118,000,000,  but the total cost of work may increase based upon
changes in the work to be performed.  On January 11, 2008,  ICM notified us that
due  to  our  funding   issues   discussed   below   under  Item  2.   Financial
Information--Management's  Discussion  and Analysis of Financial  Condition  and
Results of Operations--Recent Developments,  additional time will be required to
complete the work under the ICM Contract.  We expect the design and construction
of the Facility to be substantially  completed in the fourth quarter of 2008. In
addition to designing  and building the Facility,  ICM will provide  training to
our employees to operate the Facility through a six week training course.

     Under the ICM  Contract,  ICM has the right to stop  work,  upon seven days
written  notice  to us,  if we do not pay ICM  amounts  coming  due that we have
certified for payment;  provided,  however,  ICM may not stop work if there is a
good faith  dispute  regarding  the amount of payment  due. ICM has the right to
terminate  the ICM  Contract  on seven  days  written  notice if (i) the work is
suspended,  without  fault on the part of ICM, by us or by order of the court or
other public authority for a period of more than 90 days, or (ii) we fail to pay
ICM undisputed  amounts within 30 days of receiving an application  for payment.
We may suspend ICM's performance at any time and without cause for up to 90 days
by  providing  written  notice  to ICM and the date on which  performance  is to
resume. In addition,  we may terminate the ICM Contract for cause for any of the
following  reasons:  (w) ICM fails to perform  its work in  accordance  with the
agreement,  (x) ICM intentionally or willfully disregards any law or regulation,
(y) ICM materially  breaches any provision of the agreement,  or (z) ICM becomes
financially  insolvent,  files for a  voluntary  petition of  bankruptcy,  or an
involuntary petition of bankruptcy is filed and not dismissed within 180 days of
such filing.

     On December  18,  2006,  we entered  into a Standard  Form of  Design-Build
Agreement and General Conditions Between Owner and Contractor with T&S (the "T&S
Contract"), under which TS agreed to provide us with the design and construction
of a 1,000,000  bushel grain receiving and storage facility and Distillers Grain
storage  facility.  The  work  provided  for  under  the T&S  Contract  is to be
substantially  completed no later than May 5, 2008. For its services,  we agreed
to pay T&S  $9,745,000,  subject to any change  orders.  The T&S Contract can be
terminated by T&S if (i) the work has stopped for a 90 day period due to a court
order, a national  emergency or other  government act which results in a lack of
available  materials,  (ii) work stopping for at least 90 days as a result of us
suspending the work or our failure to pay (work can be stopped 30 days after our
failure  to pay),  (iii)  our


                                       2

material  delay  of  T&S's  performance,  (iv) our  material  breach  of the T&S
Contract, or (v) our failure to furnish reasonable evidence that we will be able
to pay the  costs of the  project  as they come due.  We can  terminate  the T&S
Contract if T&S breaches the  agreement in specified  ways.  If we terminate the
T&S Contract after commencement of construction,  we agreed to pay an additional
5% of the remaining balance of the contract price.

     On November 27, 2006,  we entered into an  Engineering  Services  Agreement
with HGM (the "HGM Contract").  Under the HGM Contract, HGM agreed to provide us
with professional design services for the development,  design, and construction
of our Facility. Such services include geotechnical coordination,  site grading,
utilities (including wells and water mains, natural gas, sanitary sewer, process
sewer  outfall,  and fire loop),  substation  coordination,  a  landscape  plan,
construction   staking,   construction   administration,   a  resident   project
representative,  compaction and material testing coordination,  record drawings,
and site coordination.

     We have agreed to pay HGM either hourly rates or fixed prices, depending on
the services.  The fixed prices total $93,200 for plant site grading  revisions,
the plant road design, the water well and raw water main, the outfall sewer, the
sanitary  sewer/collection/lift station, the potable water system the fire main,
the landscape plan, and natural gas.  Hourly fees will be paid for  geotechnical
coordination, construction staking and construction administration; in addition,
hourly fees will be paid for (i) any  additional  services added at a later date
and  (ii)  any  revisions  made  by us  requiring  HGM to  change  any  plan  or
specifications.  The hourly  fees  range from $35 to $280 per hour.  There is no
estimated  total cost for any hourly  services.  In addition  to these fees,  we
agreed  to  reimburse  HGM  for  direct  non-salary  expenses  including  travel
expenses,  reproduction costs and computer plots, postage, express mail, courier
services and handling of drawings, renderings, artwork, models, photography, and
other deliverables.  The estimated cost of such reimbursable  expense is $1,300,
but the actual amount may exceed such estimate.

     Either party may terminate the HGM Contract for cause upon at least 14 days
notice.  Termination for cause includes  violation of the covenants,  agreements
and  stipulations  of the  HGM  Contract  and  nonpayment  by  us.  In  lieu  of
termination due to our nonpayment, HGM may elect to suspend its services. If HGM
elects to suspend its services due to  nonpayment,  HGM has no liability for any
delay or damage caused.  In addition to termination  for cause, we may terminate
the HGM Contract for any reason with at least 30 days notice to HGM.

Status of Plant Construction

     With the proceeds of our two equity offerings, we began construction of our
Facility in February of 2007 with  grading and GeoPier  installation.  T&S began
work on the grain and DDGS silos in  February,  2007,  with the silos poured the
end of July and the DDG building set and sided in October,  2007.  As of January
15, 2008, the status of the various components of the Facility were as follows:

     o    The fire loop is complete,  and the north, east and south sides of the
          plant area are fenced.
     o    The grain receiving silos and the DDGS silo
          are structurally complete and we are installing equipment in them.
     o    The DDGS building,  the cooling tower,  the  fermentation  and storage
          tanks,  the  potable  water  system,  and the  septic  system  are all
          substantially complete.
     o    The water treatment building is 75% complete.
     o    The  foundation  and  slab  for the  process  area  are  complete  and
          structural steel is being installed.
     o    The slab and  foundation  work for the  dryer  building  is  complete,
          awaiting dryers to be installed.
     o    We have begun foundation work for the steam building.
     o    The storm water drainage system is complete.
     o    We have  completed  the  majority  of work on the  rail  line  and the
          railroad bridge over Pony Creek.

Plan of Operation for Remainder of Fiscal Year 2008

     Generally

     Throughout  the  remainder  of our fiscal  year 2008,  we plan to  continue
working toward  completion of the Facility and the  commencement  of operations,
which we presently  anticipate  achieving in the fourth  quarter of


                                       3

2008, and to raise additional capital through one or more equity financings,  as
further discussed elsewhere in this Registration statement. We do not presently,
nor intend to in the future, conduct any research or development activities.

     Employees

     The  Company  had six full time  employees  as of  December  31,  2007.  We
anticipate  hiring an additional 45 employees in September,  2008,  prior to the
commencement of our operations.  We are not subject to any collective bargaining
agreements  and we have not  experienced  any  work  stoppages.  Our  management
considers the Company's employee relationships to be favorable.

Rail Access

     A six mile loop  railroad  track for rail  service to our Facility is under
construction.  The track will come off the  Council  Bluffs  Energy  Center line
where interstate I-29 crosses and will proceed south along the east side of Pony
Creek.  We have obtained  easements with the property owners along this route to
permit our intended  access.  The track will terminate in a loop-track  south of
the Facility, which will accommodate 100 car unit trains.

     On June 25, 2007, we entered into a Railcar  Sublease  Agreement  ("Railcar
Agreement")  with Bunge for the  sub-lease of 320 ethanol cars and 300 DDGS cars
which will be used in the delivery and marketing of ethanol and DDGS. We will be
responsible for all maintenance and mileage charges as well as the monthly lease
expense and certain railcar modification expenses.  Under the Railcar Agreement,
we will lease railcars for terms lasting 120 months and continuing on a month to
month basis thereafter. The Railcar Agreement will terminate upon the expiration
of all railcar leases.

Principal Products

     Ethanol

     Ethanol is a  chemical  produced  by the  fermentation  of sugars  found in
grains and other  biomass.  Ethanol can be produced  from a number of  different
types of grains,  such as wheat and sorghum,  as well as from agricultural waste
products  such as sugar,  rice hulls,  cheese whey,  potato  waste,  brewery and
beverage  wastes  and  forestry  and paper  wastes.  However,  according  to the
Renewable Fuels Association (www.Ethanolrfa.org) approximately 90% of ethanol in
the United  States  today is produced  from corn  because  corn  produces  large
quantities of  carbohydrates,  which convert into glucose more easily than other
kinds of biomass.

     Ethanol  has been used in motor  fuels in the  United  States  for the last
century,  but for all practical  purposes had not been used  commercially  until
1978. At that time a deliberate  public policy  objective to create a fuel-grade
ethanol  industry  was  established  by  Congress  when it created an excise tax
exemption  in order to  encourage  the  production  of  ethanol  from  renewable
resources.   According  to  the  Renewable  Fuels   Association   website  (www.
ethanolrfa.org),  the industry has grown from virtually zero  production at that
time to a current annual  production level of approximately 4.9 billion gallons,
with  approximately  another 6.0 billion gallons  currently  expected to come on
line by 2009.

     We entered into an Ethanol  Merchandising  Agreement ("Ethanol  Agreement")
with Lansing Ethanol Services, LLC ("Lansing"),  under which we agree to sell to
and Lansing agrees to buy all ethanol  produced at our Facility.  Contract terms
for the sale of ethanol  will be specified  in sale  contracts.  Pricing for the
ethanol  will  be  set by our  Risk  Management  Committee.  Under  the  Ethanol
Agreement,  we assume  all  responsibility  for  market  price  fluctuations  of
ethanol, but once a price is fixed in a sales contract,  that price controls. If
we are made an offer to sell  ethanol  at a price  greater  than  Lansing  pays,
Lansing has the option of paying that amount or allowing us to sell to the other
offeror. For its services, we agreed to pay Lansing a per-gallon fee for ethanol
delivered under the Ethanol Agreement.  We also agreed to allow Lansing to store
up to 2.8 million  gallons of ethanol at the  Facility at any time at no cost to
Lansing.  The Ethanol  Agreement expires on December 31, 2010, but automatically
renews for one year periods,  until and unless a party  provides the other party
notice to not renew  more than 90 days prior to


                                       4

expiration.  We have a right to terminate the Ethanol  Agreement  upon providing
specified notice. It is anticipated that the ethanol will be marketed  primarily
in 100 unit car trains, and distributed through regional blenders.

     Distillers Grains

     The chief  co-product  of the  ethanol  production  process  is  Distillers
Grains, which are the residues that remain after high quality cereal grains have
been fermented by yeast. In the fermentation  process,  the remaining  nutrients
undergo a three-fold  concentration  to yield wet distillers  grains to which is
added evaporator syrup to create wet distillers  grains with solubles,  or WDGS.
WDGS is a highly  digestible  feed ingredient  marketed  primarily to the dairy,
beef,  sheep,  swine and  poultry  industries.  Once  operational,  we intend to
annually  dry 300,000  tons of our WDGS to become  distillers  dried grains with
solubles, or DDGS, which has a longer shelf life (three summer days, five winter
days) than WDGS and can better withstand  transportation over greater distances.
We plan to annually market 50,000 tons of our Distillers Grains as WDGS.

     We have entered into a Distiller's  Grain Purchase  Agreement dated October
13, 2006 ("DG Agreement") with Bunge, under which Bunge is obligated to purchase
from us and we are obligated to sell to Bunge all Distillers  Grains produced at
our Facility.  If we find another  purchaser for  Distillers  Grains  offering a
better price for the same grade, quality,  quantity, and delivery period, we can
ask Bunge to either market  directly to the other purchaser or market to another
purchaser on the same terms and pricing.

      The initial term of the DG  Agreement  begins July 15, 2008 or a different
date if agreed upon in writing by both parties,  and lasts for ten years. The DG
Agreement will  automatically  renew for additional  three year terms unless one
party  provides the other party with notice of election to not renew 180 days or
more prior to expiration.  Under the DG Agreement,  Bunge will pay us a Purchase
Price equal to the Sales Price minus the Marketing Fee and Transportation Costs.
The Sales Price is the price received by Bunge in a contract consistent with the
DGS  Marketing  Policy or the spot price  agreed to between  Bunge and us. Bunge
receives a Marketing  Fee  consisting  of a  percentage  of the Net Sales Price,
subject to a minimum  yearly  payment of $150,000.  Net Sales Price is the Sales
Price less the Transportation  Costs and Rail Lease Charges.  The Transportation
Costs are all freight charges,  fuel surcharges,  and other accessorial  charges
applicable to delivery of Distillers Grains.  Rail Lease Charges are the monthly
lease  payment for rail cars along with all  administrative  and tax filing fees
for such leased rail cars.

     Other Co-Products

     Carbon  dioxide is a co-product  produced by yeast in the  fermentation  of
sugars  to  ethanol.  We are  investigating  possible  markets  for this  carbon
dioxide.  This investigation is in its early stages, and no potential purchasers
of the carbon dioxide have yet been  identified.  The capture and sale of carbon
dioxide  could  provide  another  revenue  stream  differentiating  us from  the
majority of ethanol plants that do not sell carbon dioxide.  However,  we do not
plan to sell carbon dioxide at this time.

Description of Dry Mill Process

     Our Facility  will produce  ethanol by  processing  corn.  The corn will be
received by  semitrailer  truck (or railcar if needed),  and will be weighed and
stored in a  receiving  building.  It will then be  transported  to a scalper to
remove rocks and debris before it is conveyed to storage bins.  Thereafter,  the
corn will be  transported  to a hammermill  or grinder where it is ground into a
mash and  conveyed  into a tank for  processing.  We will  add  water,  heat and
enzymes to break the ground  corn into a fine  liquid.  This liquid will be heat
sterilized  and pumped to a tank where  other  enzymes  are added to convert the
starches into glucose sugars. Next, the liquid is pumped into fermenters,  where
yeast  is  added,  to  begin  a 48 to 50  hour  batch  fermentation  process.  A
distillation  process  will divide the alcohol  from the corn mash.  The alcohol
which exits the distillation  process is then partially dried. The resulting 200
proof  alcohol is pumped into  storage  tanks.  Corn mash from the  distillation
process  is  then  pumped  into  one of  several  centrifuges.  Water  from  the
centrifuges is dried into a thick syrup.  The solids that exit the centrifuge or
evaporators  are called wet cake and are conveyed to dryers.  Corn mash is added
to the wet cake as it enters the dryer, where moisture is removed.  This process
produces Distillers Grains.


                                       5

Raw Materials

     Corn Requirements

     Ethanol  can be  produced  from a number of  different  types of grains and
waste products. However, approximately 90% of ethanol in the United States today
is  produced  from corn.  The cost of corn is affected  primarily  by supply and
demand factors such as crop production,  carryout,  exports, government policies
and programs,  risk management and weather.  Despite strong corn production over
the last three growing seasons, corn prices rose dramatically in our 2007 fiscal
year due in part to additional corn demand from the ethanol industry.  On August
10, 2007,  the USDA  predicted  that the United States corn  production for 2007
would be 13.1 billion  bushels.  This  substantial  increase in corn production,
compared to 10.7  billion  bushels in 2006,  is  attributed  to  increased  corn
planting as a result of high corn  prices at the end of 2006 and early 2007.  As
more ethanol  production  capacity comes online,  we expect the price of corn to
continue to rise, despite increased corn production.

     We  anticipate  that our  Facility  will need  approximately  39.3  million
bushels of corn per year,  or  approximately  108,000  bushels  per day,  as the
feedstock  for its dry milling  process.  The grain supply for our plant will be
obtained  primarily from local markets.  To assist in our securing the necessary
quantities  of grain for our plant,  we entered  into a Grain  Feedstock  Agency
Agreement  ("Agency  Agreement") with AGRI-Bunge,  LLC ("A-B") dated October 13,
2006,  under  which A-B agreed to serve as our agent and acquire all of the corn
necessary  for the  operation  of our  Facility.  If we find  corn for sale by a
reliable  supplier  at a better  price than  available  through A-B for the same
grade,  quality,  quantity,  and delivery  period,  we can ask A-B to either buy
directly from the other supplier or buy from another  supplier on the same terms
and  pricing  as we  obtained.  We  agreed  to pay A-B an  agency  fee for  corn
delivered to the Facility,  with a minimum yearly agency fee of $225,000.  After
three years,  the agency fee and minimum yearly agency fee will be  recalculated
by reference  to a specified  index.  The initial  term of the  agreement is ten
years from July 15, 2008, or a different  date if agreed upon in writing by both
parties.  The agreement will automatically renew for three year terms unless one
party  provides  notice of  election  to not  renew at least  180 days  prior to
expiration.

     The price and availability of corn are subject to significant  fluctuations
depending  upon a number of factors  which affect  commodity  prices in general,
including crop conditions, weather, governmental programs and foreign purchases.
In the ordinary course of business, once we are operational,  we anticipate that
we will enter into forward purchase contracts for our commodity purchases.

     Energy Requirements

     The  production  of ethanol is a very energy  intensive  process which uses
significant amounts of electricity and a supply of a heat source.  Presently, we
anticipate  that about 34,000 BTUs of energy are required to produce a gallon of
ethanol. Additionally, water supply and quality are important considerations.

     Steam

     Unlike  most  ethanol  producers  in the  United  States  which use coal or
natural gas as their primary  energy  source,  our primary energy source will be
steam. We believe that utilizing  steam will enable us to better compete,  as it
is readily  available to us, it has no  emissions,  and it is cheaper than other
available  sources of energy.  We have  entered into an Executed  Steam  Service
Contract  ("Steam  Contract") with  MidAmerican  Energy Company  ("MidAm") dated
January 22, 2007,  under which MidAm agreed to provide the steam required by us,
up to 475,000  pounds per hour.  We agree to pay a Net Energy Rate for all steam
service  provided  under the Steam  Contract  and a Monthly  Demand  charge  for
Condensate Not Returned.  Condensate  Not Returned is the steam  delivered to us
less the  condensation we return to MidAm.  The Net Energy Rate is set for first
three years then adjusted each year started on the third  anniversary  date. The
Steam  Contract  remains in effect for ten years from the earlier of the date we
commence a continuous grind of corn for ethanol production, or January 1, 2009.


                                       6

     Natural Gas

     Although  steam will be our  primary  energy  source and will  account  for
around 95% of our energy usage, we will require natural gas for back-up when our
steam service is temporarily  unavailable  and any additional  energy  resources
needed.  Natural  gas  prices  fluctuate  with the energy  complex  in  general.
Recently,  natural gas prices have  trended  lower.  We expect that  natural gas
prices  will  remain  steady in the near  future and will trend  higher into the
winter  months of 2008 as  seasonal  demand for  natural  gas  increases  due to
heating needs in the colder  weather.  We are currently  seeking to enter into a
long term contract for our natural gas needs.

     Electricity

     Our plant will require a large continuous  supply of electrical  energy. We
plan on purchasing  electricity  from MidAm under an Electric  Service  Contract
("Electric  Contract") dated December 15, 2006. Under the Electric Contract,  we
are allowed to install a standby  generator,  which  would  operate in the event
MidAm is unable to provide us with  electricity.  In the Electric  Contract,  we
agreed to own and operate a 13kV switchgear with metering bay, all  distribution
transformers, and all 13 kV and low voltage cable on our side of the switchgear.
We agreed to pay (i) a service charge of $200 per meter, (ii) a demand charge of
$3.38 in the Summer and $2.89 in the Winter  (iii) a reactive  demand  charge of
$0.49/kVAR of reactive demand in excess of 50% of billing demand, (iv) an energy
charge  ranging from  $0.03647 to $0.01837 per kilowatt  hour,  depending on the
amount of usage and season, (v) tax adjustments,  (vi) AEP and energy efficiency
cost recovery  adjustments,  and (vii) a CNS capital  additions  tracker.  These
rates only apply to the primary  voltage  electric  service  provided  under the
Electric Contract.  The electric service will continue at these prices for up to
60 months,  but in any event will  terminate on June 30, 2012. The pricing under
the Electric  Contract is based on the assumptions  that we will have an average
billing demand of 7,300 kilowatts per month and that we will average an 85% load
factor over a 12 month period.  If these  assumptions  are not met, then we will
pay the most applicable tariff rate. Additionally,  at any time, we may elect to
be charged under one of MidAm's electric tariffs.

     Water

     We will require a significant supply of water. Much of the water used in an
ethanol plant is recycled  back into the process.  There are,  however,  certain
areas of  production  where fresh water is needed.  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 (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.  Much of the water can be recycled back
into the process,  which will minimize the effluent.  Our Facility's engineering
specifications  provide  that our fresh  water  requirements  are  approximately
1,000,000  gallons per day. We anticipate  that our water  requirements  will be
supplied  through  three  ground  wells  which are  permitted  to  produce up to
2,000,000 gallons of water per day. We could also access water from the Missouri
River.

Principal Supply & Demand Factors

     Ethanol

     Generally

     Ethanol  prices have trended  lower  during the three month  period  ending
December 31, 2007.  Management currently expects ethanol prices will continue to
track the prices of unleaded  gasoline.  Management  believes the industry  will
need to grow both  product  delivery  infrastructure  and demand for  ethanol in
order to sustain price levels above  historical  averages on a long-term  basis.
According to the Renewable Fuels Association,  as of August 29, 2007, there were
128 ethanol plants in operation  nationwide  with the capacity to produce nearly
6.8 billion gallons of ethanol  annually.  An additional 77 new plants and eight
expansions  are  currently  under  construction,  which  will add an  additional
estimated  6.6 billion  gallons of annual  production  capacity.  Unless the new
supply of ethanol is equally  met with  ethanol  demand,  downward  pressure  on
ethanol prices could continue.


                                       7

      According to Ethanol Producer Magazine, ethanol demand has been relatively
stable at approximately  6.2 billion gallons per year throughout  2007.  Ethanol
demand expanded significantly in 2006 due to replacement of MTBE with ethanol as
the oxygenate in reformulated  fuel required for carbon monoxide  non-attainment
areas in the  winter  months.  This  could  mean that  there may be some  slight
seasonality to the demand for ethanol, with increases in demand occurring during
the winter  months.  However,  we believe  that most of the  increase in ethanol
demand due to MTBE replacement has already occurred. Management believes that it
is  important  that ethanol  blending  capabilities  of the  gasoline  market be
expanded  in order to  increase  demand for  ethanol.  Recently,  there has been
increased  awareness  of the need to expand  ethanol  distribution  and blending
infrastructure,  which  would allow the  ethanol  industry to supply  ethanol to
markets in the United States that are not currently blending ethanol.

     VEETC

     The  profitability  of the ethanol  industry is impacted by federal ethanol
supports and tax  incentives,  such as the Volumetric  Ethanol Excise Tax Credit
("VEETC")  blending  credit.  The passage of the VEETC has helped to provide the
flexibility  necessary to expand ethanol blending into higher blends of ethanol,
such as E85. The VEETC went into effect on January 1, 2005.  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.
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 gasoline, diesel and ethyl tertiary butyl ether, 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.

     RFS

     The  federal  legislation  which  impacts  ethanol  demand the most are the
Energy  Policy Act of 2005 (the  "2005  Act") and the  Energy  Independence  and
Security  Act of 2007  ("2007  Act").  Most  notably,  the 2005 Act  created the
Renewable  Fuels Standard  ("RFS"),  which was designed to favorably  impact the
ethanol industry by enhancing both the production and use of ethanol. The RFS is
a national program that does not require that any renewable fuels be used in any
particular  area or state,  allowing  refiners to use  renewable  fuel blends in
those areas where it is most cost-effective.

     In 2006,  significantly  more  ethanol was blended than was required by the
RFS. The RFS for 2006 required the blending of four billion gallons of renewable
fuels,  and the ethanol  industry alone produced  nearly five billion gallons of
ethanol in 2006. For this reason, the RFS likely did not significantly  increase
demand for  ethanol in 2006.  Additional  demand for  ethanol may have come from
fuel blenders replacing MTBE with ethanol.

     The 2007 Act amended  several  components  of the RFS. The RFS now requires
(i) the fuel  refining  industry as a whole  (including  refiners,  blenders and
importers) to use 4.5 billion gallons of renewable fuels in 2007,  increasing to
15.2  billion  gallons by 2012 and 36 billion  gallons  by 2022;  (ii)  advanced
biofuel  (renewable  fuel  derived  from corn  starch  other  than  ethanol  and
encompassing  cellulosic biofuel and biomass-based  diesel),  cellulosic biofuel
and  biomass-based  diesel  to be  used  in  addition  to  conventional  biofuel
(ethanol);  (iii) for 2008,  the use of  approximately  nine billion  gallons of
renewable fuels (only ethanol); (iv) in 2012, the use of 13.2 billion gallons of
ethanol,  two  billion  gallons  of  advanced  biofuel,  .5  billion  gallons of
cellulosic biofuel, and one billion gallons of biomass-based diesel, for a total
of 15.2 billion gallons of renewable fuel; and (v) by 2036,  usage of 15 billion
gallons of ethanol, excluding advanced biofuel.

     The  2007  Act also  requires  facilities  beginning  operation  after  its
enactment to operate with at least a 20% reduction in lifecycle  greenhouse  gas
emissions  compared to gasoline.  In the event the EPA  determines  this size of
reduction is not feasible, it may reduce the required reduction, but in no event
will a new plant be allowed to operate at less than a 10% reduction in lifecycle
greenhouse gas emissions. Presently, we are assessing our options to


                                       8

comply with this  requirement.  We believe  that our use of steam as our primary
energy source will reduce our  emissions,  as compared to other  ethanol  plants
which utilize natural gas or coal as their primary heat source.

     The  ethanol  industry  is  expanding  production  at a rapid  pace  and is
projected to be  significantly  higher than the 2007 RFS amount.  This means the
ethanol industry must continue to generate demand for ethanol beyond the minimum
floor set by the RFS in order to  support  current  ethanol  prices.  We will be
dependent  on  Lansing's  ability  to market  the  ethanol  in this  competitive
environment.

     State Initiatives

     In 2006,  Iowa passed  legislation  promoting the use of renewable fuels in
Iowa.  One of the  most  significant  provisions  of the  Iowa  renewable  fuels
legislation is a renewable  fuels standard  encouraging 10% of the gasoline sold
in Iowa to consist of renewable  fuels by 2009.  This  renewable  fuels standard
increases   incrementally  to  25%  of  the  gasoline  sold  in  Iowa  by  2019.
Additionally, certain plants located in Nebraska that were in production on June
30,  2004 are  eligible  for state  incentives,  which  authorize  a producer to
receive up to $2.8 million of tax credits per year for up to eight years.

     E85

     Demand for ethanol has been  affected by the increased  consumption  of E85
fuel.  E85 fuel is a blend of 85% ethanol  and 15%  gasoline.  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.
E85 can be used as an aviation  fuel,  as reported by the National  Corn Growers
Association, and as a hydrogen source for fuel cells. According to the Renewable
Fuels  Association,  there are  currently  more than five million  flexible fuel
vehicles capable of operating on E85 in the United States and automakers such as
Ford and General Motors have  indicated  plans to produce  several  million more
flexible fuel vehicles per year. The National Ethanol Vehicle  Coalition reports
that there are currently  approximately 1,150 retail gasoline stations supplying
E85.  While the number of retail E85  suppliers has  increased  each year,  this
remains  a  relatively  small  percentage  of the total  number  of U.S.  retail
gasoline  stations,  which is  approximately  170,000.  In order for E85 fuel to
increase demand for ethanol,  it must be available for consumers to purchase it.
As public  awareness  of ethanol and E85  increases  along with E85's  increased
availability,   management   anticipates  some  growth  in  demand  for  ethanol
associated with increased E85 consumption.

     Cellulosic Ethanol

     Due to the current high corn prices,  discussion of cellulose-based ethanol
has recently increased.  Cellulose is the main component of plant cell walls and
is the most common organic compound on earth.  Cellulose is found in wood chips,
corn stalks and rice straw,  among other common  plants.  Cellulosic  ethanol is
ethanol produced from cellulose, and currently, production of cellulosic ethanol
is in its  infancy.  It is  technology  that is as yet  unproven on a commercial
scale. However,  several companies and researchers have commenced pilot projects
to study the feasibility of commercially  producing  cellulosic ethanol. If this
technology  can  be  profitably   employed  on  a  commercial  scale,  it  could
potentially  lead to ethanol that is less  expensive to produce than  corn-based
ethanol,  especially  if corn prices  remain high.  Cellulosic  ethanol may also
capture more government  subsidies and assistance than corn-based ethanol.  This
could decrease demand for our product or result in competitive disadvantages for
our ethanol production process.

     Local Production

     Because  we are  located on the border of Iowa and  Nebraska,  and  because
ethanol producers generally compete primarily with local and regional producers,
the ethanol  producers  located in Iowa and Nebraska  presently  constitute  our
primary   competition.   According  to  the  Iowa  Renewable  Fuels  Association
(www.iowarfa.org),  in  2007,  Iowa had 28  ethanol  refineries  in  production,
producing 1.9 billion gallons of ethanol from 690 million bushels of corn. There
are an additional 20 ethanol  refineries under construction or expansion in Iowa
as of January 1, 2008. If all these plants are  completed,  it is anticipated it
will add 1.5 billion  gallons of new  ethanol  production  capacity


                                       9

annually in Iowa. We expect more plants will begin construction, but at a slower
pace  than   previous   years.   According   to  the  Nebraska   Ethanol   Board
(www.ne-ethanol.org),   there  are  currently  20  existing  ethanol  plants  in
Nebraska,  and seven plants under  construction.  Additionally,  certain  plants
located in Nebraska  that were in  production  on June 30, 2004 are eligible for
state  incentives,  which  authorize a producer to receive up to $2.8 million of
tax credits per year for up to eight years. Those producers  qualifying for this
incentive will have a competitive advantage over us.

     Distillers Grains

     Management  expects that Distillers Grains prices will decrease slightly in
the foreseeable  future as the supply increases (the result of increased ethanol
production).  However,  if current high corn prices  persist,  it may positively
affect the price of  Distillers  Grains  because many corn users may  substitute
Distillers  Grains as feed for  livestock  during  periods  when corn prices are
high.

Regulatory Environment

     Governmental Approvals

     Ethanol  production  involves the emission of various airborne  pollutants,
including  particulate matters,  carbon monoxide,  oxides of nitrogen,  volatile
organic compounds and sulfur dioxide.  Ethanol  production also requires the use
of  significant  volumes of water,  a portion of which is treated and discharged
into  the  environment.   We  are  required  to  obtain  various  environmental,
construction and operating permits,  as discussed below. Under the HGM Contract,
HGM has  agreed  to take  primary  responsibility  for  obtaining  some of those
permits.  In addition,  ICM is responsible  for obtaining  various  construction
permits and registrations. Even though we have successfully acquired the permits
necessary at our stage of construction,  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.  In addition,  although we do not presently  intend to do so, if we
sought to expand the  Facility's  capacity  in the  future,  we would  likely be
required to acquire additional  regulatory permits and could also be required to
install additional pollution control equipment.

     Our failure to obtain and  maintain  the permits  discussed  below or other
similar  permits  which may be  required  in the future  could  force us to make
material changes to our Facility or to shut down  altogether.  The following are
summaries  of the various  governmental  approvals  needed to obtain in order to
become operational.

     Environmental Regulations and Permits

     We will be subject to regulations on emissions from the U.S.  Environmental
Protection Agency ("EPA") and the Iowa Department of Natural Resources ("IDNR").
The EPA's and IDNR's  environmental  regulations are subject to change and often
such changes are not  favorable to industry.  Consequently,  even if we have the
proper permits now, we may be required to invest or spend considerable resources
to comply with future environmental  regulations.  The capital expenses required
for us to comply with the following  environmental  regulations  are included in
the price we agreed to pay ICM under the ICM Contract.

     Air Pollution Construction and Operation Permits

     Based on reportable emissions, our Facility is considered a minor source of
regulated air pollutants,  and therefore not subject to Title V of the Clean Air
Act  ("Title  V")  or  the  Maximum  Achievable  Control  Technology   Standards
promulgated  by the EPA.  Nonetheless,  we were  required  to  apply  for an Air
Construction  Permit  with  the  IDNR  and the EPA as a  major  emitter  due our
proximity to MidAm's  adjacent  plant and a soybean crush plant.  We received an
Air Permit for construction from IDNR and the EPA, respecting our backup boiler,
ethanol process equipment,  storage tanks,  scrubbers,  and baghouses' emissions
sources.  Such a permit is required prior to  construction of or modification to
an air pollution emission source.  The Air Permit for construction  allows us to
build,  initially  operate and test a new source of air pollution,  but does not
cover any of our activities after the Facility is operational. Therefore, we are
required to obtain an Air Permit for our  operations  from both the EPA and IDNR
before we can commence operations at the Facility. The Air Permit for operations
will allow us to operate


                                       10

our Facility within certain  requirements  detailed in that permit.  There is an
annual fee associated with holding an Air Permit for operations, and that annual
fee is based on the prior  year's  actual  emission  levels.  The Air Permit for
operations is required to be renewed every five years.

     We are  required  to  collect  and keep  information  outlining  our annual
pollution  emissions.  Every year we must  provide an  accounting  of the actual
pollution generated by the Facility to the EPA and IDNR in order to maintain our
status as a Conditionally Exempt Small Quantity Generator and our Air Permit for
operating.  This  accounting  is the basis for the Air  Permit  fees,  discussed
above.

     Because  we are  installing  thermal  oxidizers  at our  Facility,  the EPA
requires us to install  Continuous  Emissions  Monitoring  or Partial  Emissions
Monitoring.  In addition, the EPA requires us to have and maintain an Operations
Monitoring Plan, which will be outlined in our Air Permit for operations.

     There  is a  risk  that  regulatory  changes  might  impose  additional  or
different  requirements.   To  date,  we  have  not  been  determined  to  be  a
non-attainment  area for any pollutant.  Being designated a non-attainment  area
means  the EPA has  determined  that  more of a  particular  pollutant  is being
emitted  in  one  area  than  the  EPA  allows.   If  our  Facility   becomes  a
non-attainment  area, then the State of Iowa could impose a State Implementation
Plan  which  would  require  the   imposition   of  Prevention  of   Significant
Deterioration  requirements  and  the  installation  of Best  Available  Control
Technologies  for any future  modifications  or expansions of the Facility.  Any
such event would  significantly  increase the operating  costs and capital costs
associated with any future expansion or modification of the Facility.

     Prevention of Significant Deterioration

     Our  Facility  is adjacent to the MidAm  coal-fired  electrical  generating
facilities.  These facilities  produce steam as a byproduct that will be used by
our  Facility  for  production   purposes,   as  discussed   elsewhere  in  this
Registration  statement. It is possible that the IDNR or the EPA could determine
that the use of steam  from  MidAm's  facilities  as the  power  source  for our
Facility renders MidAm's plant to be a "support  facility" of our Facility.  The
EPA's interpretation of its Prevention of Significant  Deterioration regulations
("PSD") generally provides that if two facilities are adjacent to each other but
have different SIC codes,  one of the facilities can still be determined to be a
support  facility for the other.  The result is that our Facility may be subject
to PSD regulations. If our Facility is subject to PSD, then both the MidAm plant
and our Facility will be considered  one major source of air  pollutants for the
applicability  of both Title V and PSD. If our  Facility and the MidAm plant are
considered  one major  source  of air  pollutants,  then we may have  difficulty
maintaining  our Air  Permits,  discussed  above,  due to the  higher  level  of
emissions coming from the combined source. If our Facility must comply with PSD,
then  it  will  be  subject  to  Best  Available  Control  Technology   ("BACT")
requirements.   Compliance  with  BACT  requirements  would  require  additional
compliance  and testing from our  engineers to establish  that the design of the
Facility uses BACT, which would materially increase our capital costs. If we are
unable to achieve BACT compliance, then our Facility's ability to obtain permits
and operate  would be  jeopardized.  PSD  compliance  would also require (i) the
coordination  of  additional  air  dispersion  modeling  by both  MidAm  and our
Facility  in order to obtain an air  discharge  permit  from IDNR,  and (ii) our
Facility to meet both  National  Ambient Air  Quality  Standards  and not exceed
ambient air increment limits for major  modifications.  If we are subject to PSD
and the air  dispersion  modeling  indicates that the Facility is unable to meet
either of these PSD  requirements,  then the Facility  would be unable to obtain
the necessary operating permits, unless the design or capacity of our plant were
reduced or modified.  Any reduction in the capacity of the plant or modification
to the  design  in order to meet  these  PSD  requirements  would  significantly
increase operating costs and capital costs, and otherwise  negatively impact our
ability to operate the Facility profitably.

     New Source Performance Standards

     The  Facility  is  subject to the EPA's New  Source  Performance  Standards
("NSPS") for both its distillation processes and the storage of volatile organic
compounds  used in the  denaturing  process.  Duties imposed by the NSPS include
initial notification,  emission limits,  compliance and monitoring  requirements
and  recordkeeping  requirements.  These  standards  will require  equipment and
procedures which will increase our operating and capital costs.


                                       11

     We are required to provide the EPA with various NSPS  Notifications.  These
notifications  are required before and after the start of construction  and also
before and after  beginning  operation of several key  processes  and  equipment
components. We have currently submitted all required notifications. We intend to
continue  to  submit  the  appropriate  forms as the  identified  processes  are
completed or equipment components are installed.

     Wetlands and Navigable Waters

     The  construction  of the  railroad  line to the  Facility or the  Facility
itself,  including roads,  bridges,  and discharge pipes, may impact wetlands or
navigable  waterways  under the  jurisdiction  of Army Corps of  Engineers  (the
"Corps").  We obtained a 404(b)(1) permit from the Corps for the construction of
our rail line.  We will also be required  to obtain a 404(b)(1)  permit from the
Corps for the construction of our steam line. An application for this permit has
been  submitted  to  the  Corps.   We  have  also  completed  a   Corps-required
Environmental  Assessment,  and it is  possible  that we will need to  undertake
certain  mitigation  efforts in order to  eliminate  any net loss of wetlands or
other  damage  to  streams  and  rivers.  The Corps or other  agencies  have not
required an Environmental Impact Study be completed.  If an Environmental Impact
Study is required at some point in the future,  the construction of the Facility
could be  significantly  delayed.  A  significant  delay in  construction  could
significantly increase operating and capital costs.

     Endangered Species

     Prior  to  Construction,   we  performed  endangered  species  research  to
determine if any species listed on the Iowa or Federal  endangered or threatened
species list lived in the construction area. The Least Tern (Sterna  antillarum,
on both  Iowa and  federal  endangered  species  lists)  and the  Piping  Plover
(Charadrius melodus, also on both Iowa and federal endangered species lists) use
the fly ash piles and pond of the  adjacent  MidAm  power  facility  as seasonal
habitat.  The construction of the rail line which will service our Facility will
run along and adjacent to the fly ash piles and pond. We have received direction
from the United  States Fish and Wildlife  Service  ("USFWS") and IDNR to reduce
any potential impact on these endangered species,  and will accordingly restrict
rail line  construction  activities to non-nesting  seasons and strictly  follow
construction  erosion control procedures pursuant to our Construction Site Storm
Water  Pollution  Prevention  Plan,  which was  created  as part of an  National
Pollution  Discharge  Elimination System ("NPDES")  Stormwater  Discharge Permit
required  for  construction  activities.   The  Construction  Site  Storm  Water
Pollution  Prevention  Plan  details  how storm  waters will be  protected  from
exposure  to  plant  pollutants,  and also how we will  prevent  excessive  soil
erosion on the  construction  site  prior to  vegetation  growing in  sufficient
quantities to prevent such erosion. As part of the Construction Site Storm Water
Pollution  Prevention  Plan we are  required  to examine  our silt  fencing  for
integrity  degradation  each week and after each rain.  It is possible  that the
USFWS or IDNR could impose  additional  restrictions  on us at a future date and
this  would  significantly  delay  construction  of the rail line,  which  could
significantly  increase our operating or capital  costs or otherwise  negatively
impact our ability to operate the Facility as profitably.

     Rail Line Matters

     We plan  for our  railroad  line,  when  constructed,  to  only  serve  the
Facility.  While it is  possible  that we could agree with other  industries  to
share our railroad line, no such industry is known at this time. We believe that
the line should be  considered an exempt  "industry  lead track" or "spur track"
under  applicable  rail  transportation  regulations.  The United State  Surface
Transportation  Board ("STB"),  which regulates the construction of new railroad
lines,  has not required any  Environmental  Assessment  of the site.  If in the
future  additional  industries  request  access  to our  railroad  line  and the
railroad line were deemed by the STB to be a major  project,  then the STB could
require an  Environmental  Assessment or an  Environmental  Impact Study.  If an
Environmental  Impact Study were  required by the STB,  then the use of the rail
line could be  negatively  impacted.  Any negative  impact on the rail line or a
required  change in  operations  could  significantly  increase our operating or
capital costs or otherwise negatively impact our ability to operate the Facility
profitably.


                                       12

     Waste Water Discharge Permit

     We will use water to cool our closed circuit systems in the Facility and we
will  generate  boiler  blowdown  water.  In order to maintain a high quality of
water for the  cooling  system,  the water will be  continuously  replaced  with
make-up  water.  As a result,  our Facility will discharge  non-contact  cooling
water from boilers and the cooling  towers.  We received a Wastewater  Discharge
Permit from IDNR to discharge  non-contact water into the Missouri River.  Under
the Wastewater Discharge Permit, we are required to periodically test and report
our discharge activity to IDNR.

     Storm Water Discharge Permit and Other Water Permits

     We have received a Hydrostatic  Testing Water Discharge Permit from IDNR to
allow the temporary discharge of water used for testing the integrity of vessels
and equipment as part of our construction  activities.  The Hydrostatic  Testing
Water Discharge Permit allows each vessel or piece of equipment to be filled and
discharged one time. In addition,  the water used in the testing process must be
tested prior to discharge.

     We have received our Industrial Storm Water Discharge Permit from the IDNR.
This general permit was issued after two public notices and the preparation of a
Storm Water Pollution  Prevention Plan that outlines various measures we plan to
implement  to prevent  storm water  pollution.  Under our Storm Water  Pollution
Prevention Plan, we must assess the effectiveness of our run off prevention each
week and after each storm. We received a Construction Site Storm Water Discharge
Permit  ("CSSWDP")  from IDNR.  As part of the  application  for the CSSWDP,  we
prepared a Construction Site Storm Water Pollution  Prevention Plan covering how
we will control  construction  site erosion.  We are subject to certain  ongoing
reporting and monitoring requirements to retain the CSSWDP. During construction,
if we fail to maintain all conditions  specified in the CSSWDP, the Construction
Site Storm Water  Pollution  Prevention  Plan may need to be revised or changed.
This could change or delay construction,  which could significantly increase our
operating or capital costs or otherwise negatively impact our ability to operate
the Facility profitably.

     High Capacity Well Permit

     We presently  anticipate  that the Facility will not use  municipal  water,
gray  sewage  treatment  water,  or  Missouri  river  water.  We received a High
Capacity Well Permit from  Pottawattamie  County,  Iowa  authorizing us to drill
three new high capacity wells to meet our water needs.  This permit allows us to
draw to  2,000,000  gallons  of water a day  through  these  wells,  though  the
Facility is  currently  estimated  to require  only  1,000,000  gallons of water
daily.  If the  wells  are not able to  produce  at the  levels  required,  then
alternatives  such as piping Missouri River water may be investigated.  The cost
of alternative water supply sources could prohibit their use. If we are not able
to obtain  the water in the  condition  and  amounts  needed  for the  Facility,
additional resources would need to be located.  This could delay the start up of
the Facility and significantly increase our operating or capital costs.

     In addition to the High  Capacity  Well Permit,  we have received a Potable
Water Permit from IDNR.  The Potable  Water  Permit  allows us to use one of our
wells for potable water.  This potable water will be used for drinking,  toilets
and safety showers.

     Alcohol and Tobacco Tax and Trade Bureau Requirements

     Before we can begin operations,  we must comply with applicable Alcohol and
Tobacco  Tax and Trade  Bureau  (formerly  the Bureau of  Alcohol,  Tobacco  and
Firearms)  ("ATTTB")  regulations.  These regulations require that we first make
application for and obtain an alcohol fuel producer's  permit.  The application,
which we have  completed and must file 60 days prior to  commencing  operations,
must include  information  identifying  the  principal  persons  involved in our
venture and a statement as to whether any of them have ever been  convicted of a
felony or  misdemeanor  under  federal or state  law.  The term of the permit is
indefinite until terminated, revoked or suspended. The permit also requires that
we maintain  certain security  measures.  We must also secure an operations bond
pursuant to 27 CFR ss. 19.957.



                                       13

     Risk Management Plan

     Pursuant to  ss.112I(7) of the federal  Clean Air Act,  stationary  sources
with  processes  that  contain  more than a  threshold  quantity  of a regulated
substance are required to prepare and implement a Risk Management Plan. Since we
plan to use anhydrous  ammonia,  we must  establish a plan to prevent  spills or
leaks of the ammonia and an emergency  response  program in the event of spills,
leaks,  explosions  or other  events that may lead to the release of the ammonia
into the surrounding area. The same requirement may also be true for denaturant.
This  determination  will be made as soon as the  exact  chemical  makeup of the
denaturant is obtained.  We are required to conduct a hazardous  assessment  and
prepare models to assess the impact of an ammonia and/or denaturant release into
the  surrounding  area.  The  program  will be  presented  at one or more public
meetings.  In  addition,  it is  likely  that we will  have to  comply  with the
prevention    requirements   under   the   Occupational    Safety   and   Health
Administration's  Process Safety Management  Standard,  which are similar to the
Clean Air Act Risk Management Plan  requirements.  Once completed,  we will file
our  Risk  Management  Plan  with  the  EPA.  If any of the  applicable  laws or
regulations  governing our Risk Management Plan change, it could delay the start
up of our Facility and significantly increase our operating or capital costs.

     Above Ground Storage Tank Requirements

     We are  required  to obtain a permit from the State of Iowa in order to use
our above ground  storage tank for storing  ethanol.  The state of Iowa may test
our above ground  storage  tank prior to issuing the permit.  In addition to the
permit, our above ground storage tank requires a Spill, Prevention,  Control and
Countermeasure  Plan  ("SPCCP")  in  order  to  comply  with  the  EPA's  Spill,
Prevention,  Control  and  Countermeasure  Rule.  Our  SPCCP  will  address  the
likelihood and  prevention of petroleum  based  substance  spills and detail the
actions we will take in the event of any spill. Within the storage tank area, we
will have a containment  field  designed to retain any spillage for a minimum of
72 hours. The SPCCP is required prior to the plant storing any denaturant.

     Hazardous Waste Characterization Tool

     Under the Resource Conservation and Recovery Act, we may create and provide
to the EPA a Hazardous  Waste  Characterization  Tool  ("HWCT").  The  Resources
Conservation  and Recovery Act covers the disposal of solid and hazardous waste.
Typically,  ethanol plants generate such a small quantity of hazardous and solid
waste  that  they  are  classified  as a  Conditionally  Exempt  Small  Quantity
Generator.  This  classification  is entirely  dependent  on the amount of waste
generated  and can change over time.  Although  not  required  by law,  the HWCT
allows  us  to  document,  on a  monthly  basis,  that  we  still  qualify  as a
Conditionally  Exempt Small Quantity  Generator and therefore are not subject to
hazardous waste regulations.

     Top Screen Analysis

     The  Department  of Homeland  Security  ("DHS")  requires any facility that
possesses  certain  chemicals above a threshold to submit a Top Screen Analysis.
We will possess chemical subject to the Top Screen Analysis requirement and will
be required to complete the Top Screen  Analysis on an on-going  basis.  The Top
Screen  Analysis  requires us to provide  information  such as the  chemicals we
store on site,  where the chemicals are stored,  and the risks  associated  with
such  chemicals.  DHS requires us to complete the Top Screen  Analysis within 60
days of receiving any listed chemicals.

     Waste Reduction Plan

     We are  required  to submit  to IDNR and the Iowa  Department  of  Economic
Development ("IDED") a Waste Reduction Plan. The Waste Reduction Plan will focus
on the  identification  of waste  streams and how waste streams may be recycled.
All  companies  receiving  state funding must prepare and submit such a plan. We
must  submit a Waste  Reduction  Plan or we will be forced  to return  the state
funds we have received from the IDED, as discussed below.


                                       14

     Historical Site Examination

     Prior to beginning construction, we conducted a complete review of the site
for the existence of historical sites,  including Indian burial grounds.  We did
not locate any such historical sites.

     Site Security Plan

     We are in the process of developing a Site Security Plan. The Site Security
Plan  is  designed  to  enhance  the  security  of  hazardous   materials  being
transported to and from the Facility.  We have purchased a template for our Site
Security Plan from ICM and we intend to complete the Site Security Plan prior to
beginning operations and shipping of ethanol.

     On Going Activities and Reporting

     We are  required  to  provide  the  EPA  with  Tier II  Initial  Reporting,
containing a report of the hazardous chemicals stored on-site, within 90 days of
commencing  operations.  The Tier II  Initial  Report is used to  provide  local
emergency  response and fire  department  officials with a list of the hazardous
materials we store on site. Thereafter, we will provide the EPA with annual Tier
II reports of the hazardous  materials we store on site, which will similarly be
used to inform local emergency  response and fire  department  officials of such
hazardous substances.

     We are also required to submit Form R, a Toxic Release Inventory report, to
the EPA. Form R is required for  facilities  processing or using certain  listed
chemicals  above  a  regulated   quantity.   Our  annual  form  R  will  include
documentation  of our release of those certain  chemicals  into the  environment
within the previous year.

     Every five years we will be  required  to submit a Form U Report  under the
Toxic Substances Control Act ("TSCA") to the EPA. In the Form U, we are required
to  report  on  manufacturing  thresholds  that  were  exceeded  for  any of the
chemicals listed in the TSCA during the reporting period.

     Under the  Emergency  Planning  and Right to Know Act,  we are  required to
report  our  receipt of  certain  regulated  chemicals  to  community  and state
officials within 60 days. This act requires local emergency planning communities
to prepare a comprehensive emergency response plan.

     As a  producer  of over  10,000  gallons of  ethanol  per year,  we will be
required to comply with the RFS.  Under the RFS, we must  register with the EPA.
In  addition,   we  are  required  provide  the  EPA  with  our  Renewable  Fuel
Identification  Numbers,  product transfer documents and quarterly reports.  The
RFS requires us to keep these records for five years.

     Other Local Permits

     Prior to commencement of Facility operations, we will be required to obtain
a Septic System Permit from the Pottowattamie County Health Department, a Zoning
Permit from  Pottowattamie  County, and an Entrance Permit from the Mills County
Road Department.

     Nuisance

     Ethanol  production has been known to produce an odor to which  surrounding
residents  could object.  Ethanol  production may also increase dust in the area
due to operations  and the  transportation  of grain to the Facility and ethanol
and  Distillers  Grains from the  Facility.  Such  activities  may subject us to
nuisance,  trespass,  or  similar  claims by  employees  or  property  owners or
residents in the vicinity of the Facility. To help minimize the risk of nuisance
claims based on odors related to the production of ethanol and its  by-products,
we intend to install a reverse  thermal  oxidizer  and flare  technology  in the
Facility.  Nonetheless, any such claims or increased costs to address complaints
may have a  material  adverse  effect on us, our  operations,  cash  flows,  and
financial  performance.  It is  estimated  that this  equipment  will  involve a
significant capital expenditure, which is included in the price we agreed to pay
under  the  ICM  Contract.  We are  not  currently  involved  in any  litigation
involving  nuisance  claims.  If


                                       15

the Facility is subject to any litigation regarding odor or any other factors in
the  operations  or the  transportation  of products,  this could  significantly
increase our  operating  or capital  costs or  otherwise  negatively  impact our
ability to operate the Facility profitably.

     Operational Safety Regulations

     We also will be  subject to federal  and state laws  regarding  operational
safety. Risks of substantial  compliance costs and liabilities are inherent in a
large-scale  construction  project,  and in ethanol  production after a plant is
constructed.  Costs and  liabilities  related to worker  safety may be incurred.
Possible  future  developments,  including  stricter  safety laws for workers or
others, regulations and enforcement policies and claims for personal or property
damages   resulting  from  our  construction  or  operation,   could  result  in
substantial costs and liabilities.

Item 1A. Risk Factors.

The  following  risks,  together with  additional  risks and  uncertainties  not
currently  known to us or that we  currently  deem  immaterial  could impair our
financial condition and results of operation.

Risks Associated With Our Financing Plan

     We have received a going concern  opinion from our  independent  registered
     public accounting firm.

     In connection  with providing  their report on their audit of our financial
statements for the period ending September 30, 2007, our independent  registered
public  accounting  firm,  McGladrey &  Pullen,  LLP,  expressed  concern with our
ability  to  continue  as a  going  concern.  As  discussed  elsewhere  in  this
Registration statement, the source of such concern was a budget shortfall, which
we believe is now resolved.  Nonetheless,  we face ongoing  conditions under the
Credit Agreement  respecting our ability to borrow all funds committed under the
Credit  Agreement,  and we may need to raise additional  equity financing in the
future  if we  experience  cost  increases;  and,  accordingly,  there can be no
assurance  that our  project  financing  will  suffice  to allow us to  complete
construction of our plant and commence operations as planned.

     Our Units  have no public  trading  market and are  subject to  significant
     transfer restrictions which could make it difficult to sell Units and could
     reduce the value of the Units.

     We do not expect an active trading market for our limited liability company
interests,  or "Units," to develop.  To maintain our partnership tax status, our
Units may not be publicly traded.  We will not apply for listing of the Units on
any stock  exchange.  As a  result,  Members  may not sell  Units  readily.  The
transfer of our Units is also  restricted  by our Second  Amended  and  Restated
Operating Agreement dated March 7, 2008 (the "Operating  Agreement").  Transfers
without the approval of our Board of Directors  ("Board")  are not permitted and
are invalid.  Furthermore,  the Board will not approve  transfer  requests which
would cause the Company to be  characterized  as a publicly  traded  partnership
under the  regulations  adopted  under the  Internal  Revenue  Code of 1986,  as
amended (the  "Code").  The value of our Units will likely be lower because they
are illiquid. Members may be required to bear the economic risks associated with
an investment in us for an indefinite period of time.

     Members  may not  receive  cash  distributions  which  could  result  in an
     investor receiving little or no return on his or her investment.

     Distributions  are payable at the sole discretion of our Board,  subject to
the  provisions  of the Iowa  Limited  Liability  Company Act (the  "Act"),  our
Operating  Agreement and the  requirements of our creditors.  We do not know the
amount of cash that we will generate,  if any, if and once we begin  operations.
Cash  distributions  are not assured,  and we may never be in a position to make
distributions.  Our  Board  may  elect  to  retain  future  profits  to  provide
operational  financing  for the Facility,  debt  retirement  and possible  plant
expansion.  In  addition,  our loan  agreements  restrict  our  ability  to make
distributions.  This means that Members may receive little or no return on their
investment  and may be unable to  liquidate  their  investment  due to  transfer
restrictions and lack of a public trading market.  This could result in the loss
of a Member's entire investment.


                                       16

     Our Units will be subordinate to our debts and other liabilities, resulting
     in a greater risk of loss for investors.

     The Units are unsecured  equity  interests and are  subordinate in right of
payment  to all our  current  and future  debt as  discussed  elsewhere  in this
Registration statement. In the event of our insolvency,  liquidation dissolution
or other  winding  up of our  affairs,  all of our debts,  including  winding-up
expenses,  must be paid in full before any payment is made to the holders of the
Units. In the event of our bankruptcy, liquidation, or reorganization, all Units
will be paid ratably with all of our other equity  holders as provided under the
Operating Agreement, and there is no assurance that there would be any remaining
funds after the  payment of all our debts for any  distribution  to Members.  In
addition, it is possible that in order to resolve our budget shortfall discussed
elsewhere in this  Registration  statement,  it is possible  that we may have to
issue additional equity interests in the Company having  preferential  treatment
in the event we liquidated or reorganized.

     We have obtained  conditional  debt  financing and may be required to raise
     additional  equity in order to complete  construction of our Facility;  our
     failure to comply with our loan covenants or raise additional  equity could
     require us to abandon our business.

     In May 2007, we entered into the Credit  Agreement  with Lenders  providing
for a credit facility of up to $126,000,000  for the  construction and permanent
debt financing for our Facility. As discussed in more detail below under Item 2.
Financial   Information--Management's   Discussion  and  Analysis  of  Financial
Condition and Results of  Operations--Recent  Developments,  in March,  2008, we
amended  the  terms  of the  Credit  Agreement  and  obtained  the  Bridge  Loan
(together,  the "Current  Loans")  from the Bridge  Lender to resolve our budget
shortfall.  We intend to obtain  additional debt or issue  additional  equity in
order to replace the Bridge Loan. Any additional issuances of equity will dilute
the interests of Unit holders.

     We believe  the  Current  Loans  should  provide  substantially  all of the
capital we will require to complete  construction  of our Facility,  but we will
likely be required to issue additional  equity  (primarily to replace the Bridge
Loan) in order to complete  construction  and start-up of our ethanol plant. The
use of debt  financing  increases  the risk that we will not be able to  operate
profitably  because we will need to make principal and interest  payments on the
indebtedness.  Debt  financing  also  exposes our Members to the risk that their
entire  investment  could be lost in the event of a default on the  indebtedness
and a foreclosure  and sale of the Facility and its assets for an amount that is
less than the outstanding debt. Our ability to obtain additional debt financing,
if required, will be subject to the interest rates and the credit environment as
well as  general  economic  factors  and  other  factors  over  which we have no
control.

     Our debt service  requirements  and  restrictive  loan covenants  limit our
     ability to borrow more money,  make cash  distributions  to our Members and
     engage in other activities.

     Under the Credit Agreement, the Bridge Loan and other debt instruments,  we
have made  certain  customary  representations  and we are subject to  customary
affirmative  and negative  covenants,  including  restrictions on our ability to
incur  additional  debt  that  is not  subordinated,  create  additional  liens,
transfer or dispose of assets, make  distributions,  make capital expenditure in
excess of  $1,000,000  (other than on the  Facility),  consolidate,  dissolve or
merge, and customary events of default  (including  payment  defaults,  covenant
defaults,   cross  defaults,   construction   related  defaults  and  bankruptcy
defaults).  The  Current  Loans also  contain  financial  covenants  including a
minimum  working  capital amount,  minimum  reserves,  minimum current assets to
current liabilities ratio,  minimum tangible net worth, minimum tangible owner's
equity,  and a minimum fixed charge  coverage  ratio.  Our  obligations to repay
principal  and interest on the Current  Loans make us  vulnerable to economic or
market  downturns.  If we are  unable to service  our debt,  we may be forced to
reduce or delay  planned  capital  expenditures,  sell assets,  restructure  our
indebtedness or seek additional equity capital,  which would dilute our Members'
interests.  If we default  on any  covenant,  either  the  Lenders or the Bridge
Lender (or any  subsequent  lender) could make the entire debt,  once  incurred,
immediately due and payable.  If this occurs,  we might not be able to repay our
debt or borrow  sufficient


                                       17

funds to  refinance  it. Even if new  financing is  available,  it may not be on
terms  that  are  acceptable  to  us.  These  events  could  cause  us to  cease
construction,  or if  the  Facility  is  constructed  and  operating,  to  cease
operations.

Risks Associated With Construction and Development

     We depend on ICM and Bunge for  expertise  in beginning  operations  in the
     ethanol industry and any loss of these  relationships  could cause us delay
     and added expense, placing us at a competitive disadvantage.

     We will be  dependent  on our  relationships  with ICM and  Bunge and their
employees. Any loss of these relationships, particularly during the construction
and start-up period for the Facility,  may prevent us from commencing operations
and result in the failure of our business.  The time and expense of locating new
consultants,  contractors  or equity or  operational  partners  would  result in
unforeseen  expenses and delays.  Unforeseen  expenses and delays may reduce our
ability to  generate  revenue and  profitability  and  significantly  damage our
competitive  position in the ethanol  industry such that Members could lose some
or  all  of  their  investment.  We  have  already  experienced  delays  in  our
construction   schedule  because  of  our  recent  budget  shortfall  and  ICM's
corresponding  apprehension  to  continue  construction  until we  resolved  the
shortfall.

     We will also be  dependent  upon  ICM's  experience  and  ability  to train
personnel  in  operating  the  Facility.  If the  Facility is built and does not
operate to the level anticipated by us in our business plan, we will rely on ICM
to adequately  address such  deficiency.  There is no assurance that ICM will be
able to address  such  deficiency  in an  acceptable  manner.  Their  failure to
address  deficiencies  could  cause  us to halt  or  discontinue  production  of
ethanol,  which could  damage our ability to  generate  revenues  and reduce the
value of Units.

     We are dependent upon ICM to design and build the Facility.

     ICM will perform various services and provide certain  equipment  necessary
for the construction and operation of our ethanol production  Facility under the
terms of the ICM Contract.  Upon seven days written notice, ICM has the right to
stop work if we do not pay ICM  amounts  coming due that we have  certified  for
payment. In addition,  ICM has already indicated that our construction  schedule
will be delayed, as discussed above. Further, ICM can terminate the ICM Contract
upon seven days written notice for any of the following reasons:  (i) suspension
of work  for more  than 90 days by us or by  order  of a court  or other  public
authority,  through no fault to ICM or (ii) our  failure  to pay ICM  undisputed
amounts within 30 days of receiving an application for payment.

     Due to the  competitive  nature  of the  ethanol  industry  and the lack of
qualified design and construction  firms available to build plants such as ours,
ICM's  refusal or  inability  to  perform  under the ICM  Contract  could have a
material adverse effect on our ability to complete  construction of our Facility
and achieve profitability in the future.

     We may encounter  problems with the steam energy plant design,  which could
     delay or prevent start-up of Facility operations or decrease our ability to
     generate  profits  causing a  decrease  in the value of Units and  Members'
     investment returns.

     The use of steam  directly  from a  coal-fired  public  utility  as a power
source  for an ethanol  plant is  virtually  untested.  We are aware of only one
other  ethanol  plant  currently  operating  with  steam as its major  source of
energy. Because this process is new and untested for operating an ethanol plant,
it is possible that  emissions  will exceed  expectations  and that the Facility
will incur  significantly  higher  regulatory,  permit,  and  compliance  costs.
Because this is a new and untested energy source, it is possible that during the
final  design,  construction,  and initial  start up phases of the project  that
additional  and costly  engineering  and design changes may be necessary to meet
energy production, ethanol processing, and environmental requirements.  This may
lead to a decease in the value of our Units and Member investment returns.


                                       18

     We are  dependent on Mid American  Energy  Company for our steam supply and
     any  failure  by them  may  result  in a  decrease  in our  profits  or our
     inability  to operate,  which may  decrease  the value of Units or Members'
     investment return.

     On January 22, 2007,  we entered  into a Executed  Steam  Service  Contract
("Steam  Contract") with Mid American Energy Company ("MidAm") under which MidAm
will  provide us with steam to operate our ethanol  plant for ten years from the
earlier of our first grind or January 1, 2009.  If MidAm fails to deliver  steam
to us for any reason,  we may face an  interruption  in our supply and we may be
forced to seek an alternative  supply source.  Although we are currently seeking
an  agreement to install a backup  boiler,  we have not entered into any binding
agreements  with an  alternative  steam source at this time. As with natural gas
and  other  energy  sources,  our  steam  supply  can be  subject  to  immediate
interruption by weather, strikes,  transportation,  and production problems that
can cause supply  interruptions  or  shortages.  While we  anticipate  utilizing
natural gas as a temporary  heat source when  MidAm's  plant is down,  we do not
have any natural  gas supply  contracts  signed at this  point,  and an extended
interruption  in the supply of steam could cause us to halt or  discontinue  our
production of ethanol,  which would damage our ability to generate  revenues.  A
decrease  in our  revenues  may  lead to a  decrease  in the  value  of Units or
Members' investment return.

     We may not be able to protect  ourselves  from an  increase in the price of
     steam which may result in a decrease in profits,  causing a decrease in the
     value of our Units and Members' investment return.

     We will be significantly dependent on the price of steam. The Steam Contact
will last for ten years as long as our first  grind  occurs  before  January  1,
2009. The Steam Contract will fix the price of steam for three years and provide
for price  increases  annually  thereafter.  The price  increases are based upon
market  forces  over  which we have no  control.  We  anticipate  that the Steam
Contract  will  protect  us from  extreme  price  changes  for  the  term of the
agreement.  Upon the expiration of the Steam  Contract,  MidAm may locate a more
profitable  contract and pursue it rather than renegotiate with us. Furthermore,
there can be no assurance that we will be able to enter into a similar agreement
following  the  expiration  of the Steam  Contract.  Although  coal  prices  and
supplies  have  historically  been more  stable than many other forms of energy,
this may not be taken into  consideration  when we are  negotiating  a new steam
contract.  There is no  assurance  that we will be able to pass  through  higher
steam prices to our  customers.  If higher steam prices are  sustained  for some
time, such pricing may reduce our  profitability  due to higher operating costs.
This may cause a  decrease  in the value of our  Units and  Members'  investment
returns.

     We may  encounter  hazardous or unexpected  conditions at the  construction
     site  that  could  increase  our  costs or delay  the  construction  of the
     Facility,  which would delay our ability to generate  revenues and decrease
     the value of Units or Members' investment return.

     Compliance  issues with applicable  environmental  standards could arise at
any time during the  construction  and  operation of our  Facility.  We may have
difficulty obtaining the necessary  environmental permits required in connection
with the  operation  of the  Facility.  As a  condition  of  granting  necessary
permits, regulators could make demands that result in additional costs to us and
delay our ability to generate revenues.

     The project could suffer  additional  delays or construction cost increases
     that could  postpone  our  ability to  generate  revenues  and make it more
     difficult  for us to pay our debts,  which could  decrease the value of our
     Units or Members' investment return.

     We began  construction  in February  2007 and have  projected  that we will
begin operation of the proposed  ethanol plant in the fourth quarter of 2008. We
have  already  experienced  construction  delays,  primarily  the result of cost
increases  that  caused us to have a budget  shortfall  prior to  obtaining  the
Bridge Loan. As of December 31, 2007, we have expended approximately $76,300,000
on the  project.  Our  anticipated  total  project  cost has  never  been a firm
estimate  and we expect  that it will  continue  to change  from time to time as
construction  of the project  progresses.  The costs under the ICM  Contract are
subject to change.  The total amount we have to pay under the ICM Contract,  the
T&S Contract and HGM Contract may be further  increased due to design changes or
cost  overruns,  which we have  already  experienced.  Any  further  significant
increase in the construction cost of the


                                       19

Facility or significant  expense  related to the design and  construction of the
steam line and rail line may delay our  ability to generate  revenues  and hence
reduce the value of our Units and the Members' investment return.

     Additionally,  construction  projects often experience  delays in obtaining
construction  permits,  construction delays due to weather conditions,  or other
events. If it takes longer to obtain necessary permits or construct the Facility
than we currently  anticipate,  it would  further  delay our ability to generate
revenues and make it difficult for us to meet our debt service  obligations.  If
we encounter delays in obtaining the required permits, our expected construction
schedule will also be delayed.  Delays and weather  conditions could result in a
delay of the date we become operational and begin to generate revenue.

     Defects in plant  construction  could result in devaluation of our Units if
     our Facility does not produce ethanol and its co-products as anticipated.

     There is no assurance that defects in, materials and/or  workmanship in the
plant will not occur. Under the terms of the ICM Contract, ICM warrants that the
plant will meet specified performance criteria upon start-up, and that the plant
will be free from  defects  in  workmanship  and  materials  respecting  certain
Facility  components.  Though the ICM Contract  requires ICM to correct  certain
defects in material or workmanship  during the time period  specified in the ICM
Contract,  material defects in material or workmanship may still occur which ICM
is not obligated to remedy. Such defects could further delay the commencement of
operations of the Facility,  or, if such defects are discovered after operations
have commenced, could cause us to halt or discontinue the Facility's operations.
Halting or  discontinuing  the Facility's  operations could delay our ability to
generate revenues and reduce the value of Units.

     ICM will continue to employ subcontractors for key parts of the Facility.

     The  failure  on  the  part  of  major   subcontractors  to  perform  in  a
satisfactory  manner can present risk that the Facility will not be  constructed
as planned.  Failure on the part of ICM to  compensate  subcontractors  can also
present risk of claims or liens on plant assets.  These claims could result in a
loss of the value of Units.

     The ICM Contract  does not protect us from  changing  prices for  concrete,
     labor or other inputs.

     Material  ongoing price increases in key inputs used in the construction of
our Facility could result in more capital  expenditures than have been forecast.
If this occurs, the return on Members' investment will be reduced,  resulting in
a decline in the value of Units.

     ICM does not provide formal guarantees or assurances  respecting our use of
     steam heat technology at the Facility.

     Our use of  steam  at the  Facility  is a  unique  feature  which  is being
constructed on a design and build basis by ICM under the ICM Contract.  Although
the ICM  Contract  provides  that our plant  specifications  be met,  ICM cannot
guarantee use of our steam source.

     We are building our ethanol  plant upon an alluvial  plain that was created
     from historic river and glacial flows,  resulting in soil  conditions  that
     are highly  variable,  and may not be acceptable as a base for construction
     of certain Facility components.

     River bottom  ground can present soil types that may not drain  properly or
that do not support certain types of structures. This may mean that we will have
to  utilize  pilings,  higher  cost  foundations,  or deploy  soil  addition  or
stabilization   strategies  that  could  result  in  materially  higher  capital
expenditures  than have been  forecast.  This would result in a  devaluation  of
Units.  There can be no assurance  that we will not  encounter  other  hazardous
conditions  at the site.  If we  receive  notice of such  conditions,  we may be
required to correct these conditions prior to continuation of construction. This
situation  can result in  unforeseen  costs,  or  alternatively,  further  delay
construction, thereby delaying the realization of revenues and devaluing Units.



                                       20

     Any site near a major waterway system presents potential for flooding risk.

     Although our site exists within a 500-year flood plain that is protected by
a levee,  its existence  next to a major river and major creeks  presents a risk
that flooding  could occur at some point in the future.  We have procured  flood
insurance as a means of risk  mitigation;  however,  there is a chance that such
insurance will not cover certain  unforeseen  costs associated with flood damage
or loss of income,  during a flood period.  Floods would have a material adverse
impact upon Unit value.

     We may experience delays or disruption in the construction of our rail line
     and loop track, which may lead to decreased revenues.

     We  are  in  the  process  of  constructing  our  rail   infrastructure  to
accommodate  100 car  shipments.  As of December 31, 2007,  our rail line is not
complete.  We will be highly dependent on Burlington  Northern Santa Fe's timely
service of our railroad cars. There may be times when we have to slow production
at our ethanol plant due to our inability to ship all of the  Distillers  Grains
we produce.  If we cannot operate our plant at full capacity,  we may experience
decreased revenues which may affect the profitability of the Facility.

Risks Associated With Our Formation and Operation

     We are a newly formed  company with limited  working  capital,  which could
     result in losses that will affect the value of Units or Members' investment
     return.

     We were organized on March 28, 2005 and other than progressing  through the
initial stages of plant construction,  we have no operating history. Our Company
is currently  promotional and remains in its development  stages. We cannot make
representations  about our future  profitable  operation or our future income or
losses.  If our  plans  prove to be  unsuccessful,  Members  will  lose all or a
substantial part of their  investment.  There can be no assurance that the funds
we received in our prior equity offerings,  combined with debt we have obtained,
most of which will be spent on plant  construction,  will be sufficient to allow
us to operate our plant  until  profits are  attained.  Furthermore,  we need to
raise  additional  equity to replace the Bridge  Loan,  and we may need to raise
equity to complete construction or commence operations if our costs increase.

     We have no  experience  in the  construction  and  operation  of an ethanol
     plant,  which increases the risk that our Facility may be more expensive to
     build and operate than we expect, and which could decrease the value
     of Units or Members' investment return.

     The Company has and the members of its Board of Directors have little to no
experience in the organization,  construction and operation of an ethanol plant,
the ethanol industry,  or in governance or operation of a public company. Due to
this lack of  experience,  and even  though we have  hired  management  which we
believe is  qualified,  our Facility may cost more to construct and operate than
we currently  anticipate.  Further increased costs may decrease the value of our
Units and the opportunity for Members to receive a return on their investments.

     Our operation  costs could be higher than  anticipated,  which could reduce
     our profits or create  losses,  which could  decrease the value of Units or
     Members' investment return.

     We could experience cost increases  associated with the on-going  operation
of the  Facility  caused by a variety of  factors,  many of which are beyond our
control.  Corn prices could further increase and labor costs could increase over
time,  particularly if there is a shortage of persons with the skills  necessary
to operate the  Facility.  Adequacy and cost of electric,  steam and natural gas
utilities could also affect our operating costs. Changes in price, operation and
availability of truck and rail  transportation may affect our profitability with
respect to the transportation of ethanol and Distillers Grains to our customers.
In addition, the operation of the Facility will be subject to ongoing compliance
with all applicable governmental regulations,  such as those governing pollution
control, ethanol production, grain purchasing and other matters. If any of these
regulations were to change,  it could cost us


                                       21

significantly  more to comply  with  them.  We will be  subject  to all of these
regulations whether or not the operation of the ethanol plant is profitable.

     If we cannot  retain  competent  personnel,  we may not be able to  operate
     profitably,  which could decrease the value of Units or Members' investment
     return.

     Though we believe we have employed  capable  management to date, we provide
no  assurance  that we can manage the  start-up  of the project  effectively  or
properly staff our  operations.  Any failure to manage our start-up  effectively
could delay the commencement of Facility operations, and such delay is likely to
further delay our ability to generate revenue and satisfy our debt  obligations,
which may decrease the value of Units or negatively  affect Members'  investment
return.

     Our lack of business diversification could result in the devaluation of our
     Units if our revenues from our primary products decrease.

     Our  business  will  solely  consist  of  ethanol  and  Distillers   Grains
production  and sales.  We will not have any other  lines of  business  or other
sources of revenue if we are unable to complete the  construction  and operation
of the  Facility.  Our lack of business  diversification  could cause Members to
lose all or some of their  investment  if we are unable to generate  revenues by
the production and sales of ethanol and Distillers Grains since we do not expect
to have any other lines of business or alternative revenue sources.

     We have a history of losses and may not ever operate profitably.

     From our inception on March 28, 2005 through December 31, 2007, we incurred
an  accumulated  net loss of  $204,330.  We will  continue to incur  significant
losses until we complete  construction and commence  operations of the Facility.
There is no assurance  that we will be successful  in completing  our efforts to
build and  operate  the  Facility.  Even if we begin  operations  at the ethanol
plant, there is no assurance that we will be able to operate profitably.

     An  investment  in our Units may decline in value due to decisions  made by
     our Board and Members'  only  recourse is to replace our  Directors,  which
     could take several years.

     Our Board of Directors  may make poor  decisions  regarding  actions of the
Company,  which  may cause a  decrease  in the  value of  Units.  Our  Operating
Agreement  provides that each member of the Board of Directors  will serve for a
four year term,  and in all cases  until a successor  is elected and  qualified.
Holders of Series A Units (the  "Series A Members")  have the right to elect the
balance of the  Directors  not  elected  by the  holders of Series B or Series C
Members,  or Series E Members,  if we issue such Units  (presently  the Series A
Members  may elect  four  Directors);  however,  the terms of the  Directorships
elected by the Series A Members are staggered such that beginning in 2008,  only
one Series A  Director  may be elected  each year.  Staggering  the terms of the
Series A  Directors,  in addition to the rights of Bunge (the "Series B Member")
and ICM (the  "Series  C  Member")  to elect  certain  Directorships,  including
Bunge's  rights to elect  directorships  in the  event it is  issued  additional
Units,  means that Series A Members could only change the control of the Company
through  electing all four Series A Directors,  which would take four years.  If
our project suffers further delays due to financing or construction or the Board
of Directors  makes poor  decisions,  the Series A Members'  only recourse is to
replace the Series A  directors  through  elections  at four  successive  annual
meetings or an amendment to our Operating  Agreement,  which may be difficult to
accomplish.

     Our  Operating  Agreement  contains  restrictions  on  Members'  rights  to
     participate  in corporate  governance  of our  affairs,  which limits their
     ability to influence management decisions.

     Our Operating  Agreement  provides that a Member or Members owning at least
30 percent of the  outstanding  Units may call a special meeting of the Members.
This may make it  difficult  for  Members  to propose  changes to our


                                       22

Operating  Agreement without support from our Board of Directors.  Our Directors
are  elected  by the  three  Series  of Units  that  have  been  issued to date:
presently, the Series A Members elect four Directors (the "Series A Directors"),
our Series B Member  elects two  Directors,  and our Series C Member  elects one
Director.  The terms  office of the Series A  Directors  are  divided  into four
classes,  with each Director serving a staggered  four-year term. In addition to
Series A Members  only  being  able to elect  four of our seven  Directors,  the
classification of the Series A Directors will make it more difficult for Members
to change the  composition of the Board because only one of the Directors can be
elected at one time.  If a vacancy  develops in our Board of  Directors  for any
reason other than removal or  expiration of a term,  the remaining  Directors of
the same Series would fill it.

     Our Directors have other business and management responsibilities which may
     cause conflicts of interest in the allocation of their time and services to
     the Company.

     Since our project is  currently  managed  both by our  officers and to some
extent by the Board of  Directors  (rather  than  completely  by a  professional
management  group),  the  devotion  of the  Directors'  time to the  project  is
critical.  However,  the Directors have other  management  responsibilities  and
business  interests  apart from our  project.  As a result,  our  Directors  may
experience  conflicts of interest in allocating  their time and services between
us and their other business  responsibilities.  No formal  procedures  have been
established to address or resolve these conflicts of interest.

     We may have conflicting  financial interests with Bunge and ICM which could
     cause them to put their financial interests ahead of ours.

     ICM and Bunge advise our Directors  and have been,  and are expected to be,
involved in  substantially  all material aspects of our financing and operations
to date.  Consequently,  the terms and conditions of our agreements with ICM and
Bunge have not been negotiated at arm's length.  Therefore,  these  arrangements
may not be as favorable to us as could have been if obtained  from  unaffiliated
third  parties.  Most  of the  cost of our  project  will be paid to ICM for the
design and  construction of our ethanol plant.  ICM may experience  conflicts of
interest  that  cause  it to  put  its  financial  interest  in the  design  and
construction of our plant ahead of our best interests.  In addition,  because of
the extensive roles that ICM and Bunge have in the development, construction and
operation of the Facility,  it may be difficult or impossible  for us to enforce
claims that we may have  against ICM or Bunge.  Such  conflicts  of interest may
reduce our  profitability and the value of the Units and could result in reduced
distributions to investors.

     Bunge has  purchased  Series B Units and is  currently  the only  holder of
Series B Units. Under our Operating  Agreement,  the Series B Member is entitled
to elect two directors  without any other votes.  Additionally,  as discussed in
more detail below under Item 2. Financial  Information--Management's  Discussion
and  Analysis  of  Financial   Condition   and  Results  of   Operations--Recent
Developments,  under the terms of the Series E Unit Issuance  Agreement  between
the Company and Bunge,  Bunge may receive Series E Units. If such Series E Units
are issued to Bunge, our Operating  Agreement provides that Bunge, as a Series E
Member,  would be  entitled,  without any other votes,  to elect one  additional
director  (to the extent that Bunge owns  between 21% and 29% of the total Units
issued and outstanding;  two additional directors (to the extent that Bunge owns
between  30% and  39% of the  total  Units  issued  and  outstanding)  or  three
additional  directors  (to the  extent  that Bunge owns 40% or more of the total
Units issued and outstanding).  This may create conflicts of interest due to any
such Directors'  affiliation with Bunge,  especially for Company action directly
or indirectly affecting Bunge.

     ICM has purchased Series C Units and is currently the only holder of Series
C Units.  Additionally,  under the terms of the Series C Unit Issuance Agreement
between the Company  and ICM,  ICM may  similarly  receive  additional  Series C
Units. Under our Operating  Agreement,  the Series C Member is entitled to elect
one  director  without any other votes.  Accordingly,  there may be conflicts of
interest resulting from any such director's affiliation with ICM, especially for
Company action directly or indirectly affecting ICM.

     ICM,  Bunge and their  respective  affiliates  may also have  conflicts  of
interest  because  ICM,  Bunge  and their  respective  employees  or agents  are
involved as owners,  creditors and in other capacities with other ethanol plants
in


                                       23

the United  States.  We cannot require ICM or Bunge to devote their full time or
attention to our activities.  As a result,  ICM and / or Bunge may have, or come
to have, a conflict of interest in  allocating  personnel,  materials  and other
resources to our Facility.

     From time to time, our Directors may serve in director or leadership  roles
     with trade associations which could raise a conflict of interest.

     A number of our  Directors  have or continue to serve as directors of local
and  state  agricultural  trade  organizations.  These  organizations  may adopt
policies,  or engage in political lobbying activities that are in opposition to,
or that  conflict  with the  Company's  business  needs.  This may  require  the
Director to abstain from votes or discussion on certain Company-related business
matters.

     An elected official serves as a Director.

     State  Senator  Hubert  Houser  is  an  elected   official  who  represents
constituents  in  southwest  Iowa  and  he  currently  serves  on the  Board  of
Directors.  As an elected official,  he is obligated to serve the needs of those
whom he  represents,  and in so doing,  from time to time,  he may need to place
these needs ahead of our needs.  In  addition,  from time to time he may have to
abstain from voting on Company  business issues that conflict with state policy,
or formal positions that the Senator is taking that may be inconsistent with our
business  needs.  Conversely,  he may be precluded  from  assisting us in public
policy debate, lobbying efforts or in the interface of the Company with state or
local government  agencies.  Senator Houser's brother is also currently a member
of the Pottawattamie County Board of Supervisors.

Risks Associated With The Ethanol Industry

     Once operational,  we will compete with larger,  better financed  entities,
     which could negatively impact our ability to operate profitably.

     There is  significant  competition  among ethanol  producers  with numerous
producers and privately  owned ethanol plants  planned and operating  throughout
the Midwest and  elsewhere in the United  States.  The number of ethanol  plants
being  developed and  constructed  in the United  States  continues to increase.
Plans  have been  announced  by a  competitor  for the  construction  of another
ethanol  plant  directly  adjacent  to  our  Facility.   Our  business  faces  a
competitive  challenge from larger plants,  from plants that can produce a wider
range of products  than we can,  and from other  plants  similar to ours.  Large
ethanol  producers such as Abengoa  Bioenergy  Corp.,  Archer  Daniels  Midland,
Aventine  Renewable Energy,  Inc.,  Cargill,  Inc., New Energy Corp. and VeraSun
Energy  Corporation,  among  others,  are capable of  producing a  significantly
greater  amount of ethanol  than we expect to produce.  In  addition,  there are
several Nebraska,  Iowa,  Minnesota,  Wisconsin,  South Dakota and other Midwest
regional  ethanol  producers which have recently  formed,  are in the process of
forming, or are under consideration, which are or would be of a similar size and
have similar  resources to us.  According to the  Renewable  Fuels  Association,
there are  currently 48  operational  ethanol  plants in Iowa and Nebraska  with
several new plants in the process of forming. Furthermore,  ethanol from certain
Central  American or Caribbean  countries  is eligible  for tariff  reduction or
elimination upon  importation to the United States.  Ethanol imported from these
Caribbean  Basin  countries may be a less expensive  alternative to domestically
produced ethanol.

     This  competition  also  means  that the  supply of  domestically  produced
ethanol is at an all-time  high.  As of October 9, 2007,  there were 131 ethanol
plants in  operation  nationwide  with a capacity to produce  nearly 6.9 billion
gallons  of ethanol  annually.  Another  73 new  plants  and 10  expansions  are
currently under construction nationally,  which will add an additional estimated
6.6 billion gallons of annual  production  capacity.  Iowa alone is estimated to
have  produced  approximately  1.97 billion  gallons of ethanol in 2007.  Excess
capacity in the ethanol  industry will have an adverse impact on our operations,
cash flows and general financial conditions.  If the demand for ethanol does not
grow at the same pace as increases  in supply,  the price of ethanol will likely
decline. If excess capacity in the ethanol industry continues,  the market price
of ethanol may  continue to decline to levels  that are  inadequate  to


                                       24

generate  sufficient cash flow to cover our costs.  This could negatively impact
our  future  profitability  and  decrease  the value of our  Units and  Members'
investment return.

     Changes in the supply,  demand,  production and price of corn could make it
     more expensive to produce ethanol, which could decrease our profits.

     Our  ethanol  production  will  require  substantial  amounts  of  corn.  A
significant  reduction in the quantity of corn harvested due to adverse  weather
conditions,  farmer  planting  decisions,  domestic and foreign  government farm
programs and policies, global demand and supply or other factors could result in
increased  corn costs which would increase our cost to produce  ethanol.  Events
that tend to negatively  impact the supply of corn are likely to increase prices
and affect our  operating  results.  Rising corn  prices  produce  lower  profit
margins for the production of ethanol,  especially when market conditions do not
allow us to pass along increased corn costs to our customers.

     We have entered into the Agency  Agreement  with A-B,  under which A-B will
serve as our  agent  and  acquire  all of the No. 2 yellow  corn  necessary  for
operation  of our  Facility.  The  initial  term is from  July  15,  2008  (or a
different  date, if agreed by the parties)  until July 15, 2018. In the ordinary
course of business,  we anticipate that once we are  operational,  we will enter
into forward purchase contracts for our commodity purchases.

     The  price  of corn  has  generally  increased  in the  past  year  and has
fluctuated  significantly  in the past and may  fluctuate  significantly  in the
future. We cannot provide assurances that we will be able to offset any increase
in the price of corn by increasing  the price of our products.  Any reduction in
the  spread  between  ethanol  and corn  prices,  whether as a result of further
increase  in corn  price  or an  additional  decrease  in  ethanol  prices,  may
adversely affect our results of operations and financial conditions,  leading to
a decrease in the value of Units and Members' investment return.

     We have executed an output  contract with Lansing that will purchase all of
     the ethanol we produce once operational, which may result in lower revenues
     because of decreased  marketing  flexibility and inability to capitalize on
     temporary  or regional  price  disparities,  and could  reduce the value of
     Units or Members' investment return.

     We executed the Ethanol Agreement with Lansing, which provides that Lansing
will purchase the entire output of our ethanol.  Lansing will market our ethanol
in national,  regional and local  markets.  Our objective in utilizing an output
contract is to provide a reliable and predictable market for our ethanol.  We do
not plan to build our own sales force or sales  organization to support the sale
of ethanol.  As a result,  we will be dependent on Lansing to sell our principle
product.  When there are  temporary or regional  disparities  in ethanol  market
prices,  it could be more  financially  advantageous  to have the flexibility to
sell  ethanol  ourselves  through our own sales  force.  We have  decided not to
pursue this route.  Our strategy  could result in lower  revenues and reduce the
value of Units if Lansing does not perform as we plan.

     Low ethanol prices and low gasoline prices could reduce our profitability.

     Prices for ethanol products can vary  significantly over time and decreases
in price levels could  adversely  affect our  profitability  and viability.  The
price for ethanol has some relation to the price for oil and gasoline. The price
of ethanol tends to increase as the price of gasoline  increases,  and the price
of ethanol tends to decrease as the price of gasoline  decreases,  although this
may not always be the case.  Any  lowering of  gasoline  prices will likely also
lead to lower prices for ethanol and adversely affect our operating results. The
total  production  of ethanol is at an all-time  high and continues to expand at
this time. Further increased production of ethanol may lead to lower prices. Any
downward change in the price of ethanol may decrease our  profitability and thus
the value of our Units and Members' investment return.



                                       25

     Increases  in the  production  of ethanol  could result in lower prices for
     ethanol  and  have  other   adverse   effects   which   could   reduce  our
     profitability.

     We expect that new fuel grade ethanol plants will be  constructed,  because
of the increase in ethanol  demand  resulting from the federal Energy Policy Act
of 2005 and the Energy  Independence  and Safety Act of 2007,  which  mandate an
increase  in  the  use  of  renewable   fuels  in  the  U.S.  to   approximately
15,200,000,000  by 2012 and  approximately  36,000,000,000  gallons  per year by
2022.  Because increased  production  capacity is usually less costly to achieve
through  expansion of existing plants,  we expect expansion will also occur. The
increased  production  of  ethanol  may lead to lower  prices for  ethanol.  The
increased  production of ethanol could have other adverse  effects as well.  For
example,  the  increased  production  will also lead to  increased  supplies  of
co-products  from the production of ethanol,  such as Distillers  Grains.  Those
increased supplies could lead to lower prices for this co-product.

     There is scientific  disagreement about the wisdom of policies  encouraging
     ethanol production,  which could result in changes in governmental policies
     concerning ethanol and reduce our profitability.

     Some studies have challenged  whether  ethanol is an appropriate  source of
fuel and fuel additives, because of concerns about energy efficiency,  potential
health effects,  cost and impact on air quality.  Federal energy policy,  as set
forth in the Energy  Policy Act of 2005 and the Energy  Independence  and Safety
Act of 2007, support ethanol production. If a scientific consensus develops that
ethanol  production  does not enhance our overall energy policy,  our ability to
produce and market ethanol could be materially and adversely affected.

     Hedging  transactions,  which, if used,  would be intended to stabilize our
     corn  costs,   also   involve   risks  and  costs  that  could  reduce  our
     profitability.

     In an attempt to minimize  the effects of the  volatility  of corn costs on
operating  profits,  we may take hedging  positions in corn futures markets once
operational.  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 hedging
activities  is  dependent  upon,  among other  things,  the cost of corn and our
ability to sell sufficient  amounts of ethanol and Distillers  Grains to utilize
all of the corn subject to the futures  contracts.  Hedging activities result in
costs such as brokers'  commissions  and other  transaction  costs. If there are
significant  swings in corn  prices,  or if we  purchase  more  corn for  future
delivery than we can use, we may have to pay to terminate a futures contract, or
resell unneeded corn inventory at a loss.

     Ethanol  production is energy intensive and  interruptions in our supply of
     energy,  or  volatility  in energy  prices,  could have a material  adverse
     impact on our business.

     Ethanol production  requires a constant and consistent supply of energy. If
our  production  is  halted  for any  extended  period  of time,  it will have a
material adverse effect on our business.  If we were to suffer  interruptions in
our energy supply,  either during  construction  or after we begin operating the
ethanol  plant,  our  business  would be harmed.  We have entered into the Steam
Contract for our primary energy source. In addition, natural gas and electricity
prices have  historically  fluctuated  significantly.  Increases in the price of
steam,  natural gas or  electricity  would harm our business by  increasing  our
energy  costs.  The prices  which we will be  required  to pay for these  energy
sources  will have a direct  impact on our costs of  producing  ethanol  and our
financial results.

     Our ability to successfully operate depends on the availability of water at
     anticipated prices.

     To produce ethanol,  we will need a significant  supply of water, and water
supply and quality are important  requirements  to operate an ethanol plant.  We
anticipate  that our water  requirements  for the plant will be  supplied by our
wells. However, there are no assurances that we will have a sufficient supply of
water to sustain the Facility in the future, or that we can obtain the necessary
permits to obtain water  directly from the Missouri  River as an  alternative to
our wells. As a result, our ability to make a profit may decline.


                                       26

     We have no current  plan to sell the raw carbon  dioxide we  anticipate  we
     will  produce  to a  third  party  processor  resulting  in the  loss  of a
     potential source of revenue.

     At this  time,  we have no  agreement  to sell the raw  carbon  dioxide  we
anticipate we will produce.  We cannot provide any assurances  that we will sell
our raw  carbon  dioxide at any time in the  future.  If we do not enter into an
agreement to sell our raw carbon dioxide,  we will have to emit it into the air.
This will result in the loss of a potential source of revenue.

     Changes and advances in ethanol  production  technology could require us to
     incur costs to update our Facility or could otherwise hinder our ability to
     complete in the ethanol industry or operate profitably.

     Advances and changes in the  technology of ethanol  production are expected
to occur. Such advances and changes may make the ethanol  production  technology
installed in our plant less  desirable or obsolete.  These  advances  could also
allow our  competitors  to  produce  ethanol  at a lower cost than us. If we are
unable to adopt or incorporate  technological  advances,  our ethanol production
methods and processes could be less efficient than our competitors,  which could
cause  our  plant  to  become  uncompetitive  or  completely  obsolete.  If  our
competitors  develop,  obtain or license  technology that is superior to ours or
that makes our  technology  obsolete,  we may be required  to incur  significant
costs to  enhance or  acquire  new  technology  so that our  ethanol  production
remains  competitive.  Alternatively,  we may be  required  to seek  third-party
licenses,  which  could  also  result  in  significant  expenditures.  We cannot
guarantee  or assure  that  third-party  licenses  will be  available  or,  once
obtained,  will continue to be available on commercially reasonable terms, if at
all. These costs could negatively impact our financial performance by increasing
our operating  costs and reducing our net income,  all of which could reduce the
value of Members' investment.

     Competition from the advancement of alternative fuels may lessen the demand
     for ethanol and negatively impact our profitability, which could reduce the
     value of Members' investment.

     Alternative fuels,  gasoline  oxygenates and ethanol production methods are
continually  under  development.  A number of  automotive,  industrial and power
generation  manufacturers  are developing  alternative clean power systems using
fuel cells or clean burning gaseous fuels. Like ethanol,  the emerging fuel cell
industry offers a technological  option to address  increasing  worldwide energy
costs,  the  long-term  availability  of petroleum  reserves  and  environmental
concerns. Fuel cells have emerged as a potential alternative to certain existing
power  sources  because  of their  higher  efficiency,  reduced  noise and lower
emissions.   Fuel  cell  industry   participants  are  currently  targeting  the
transportation, stationary power and portable power markets in order to decrease
fuel costs, lessen dependence on crude oil and reduce harmful emissions.  If the
fuel cell and hydrogen  industries continue to expand and gain broad acceptance,
and hydrogen  becomes  readily  available to consumers for motor vehicle use, we
may not be able to compete effectively. This additional competition could reduce
the demand for ethanol, which would negatively impact our profitability, causing
a reduction in the value of Members' investment.

     Corn-based ethanol may compete with cellulose-based  ethanol in the future,
     which  could  make  it  more  difficult  for  us to  produce  ethanol  on a
     cost-effective basis and could reduce the value of Members' investment.

     Most ethanol is currently produced from corn and other raw grains,  such as
milo or  sorghum -  especially  in the  Midwest.  The  current  trend in ethanol
production  research is to develop an efficient method of producing ethanol from
cellulose-based  biomass, such as agricultural waste, forest residue,  municipal
solid  waste,  and  energy  crops.  This  trend  is  driven  by  the  fact  that
cellulose-based  biomass is generally  cheaper than corn, and producing  ethanol
from  cellulose-based  biomass would create  opportunities to produce ethanol in
areas  which  are  unable  to grow  corn.  Although  current  technology  is not
sufficiently efficient to be competitive,  a report dated August 25, 2000 by the
U.S.  Department of Energy entitled "Outlook for Biomass Ethanol  Production and
Demand"  indicated  that new  conversion  technologies  may be  developed in the
future. If an efficient method of producing ethanol from cellulose-based biomass
is developed,  we may not be able to compete  effectively.  We do not believe it
will be  cost-effective  to convert  our  Facility  into a plant  which will use
cellulose-based  biomass to produce ethanol. If we are unable to


                                       27

produce ethanol as cost-effectively as cellulose-based producers, our ability to
generate revenue will be negatively  impacted and Members' investment could lose
value.

     Competition  from ethanol  imported from Caribbean basin countries may be a
     less  expensive  alternative  to our ethanol,  which would cause us to lose
     market share and reduce the value of Members' investment.

     Ethanol  produced or processed in certain  countries in Central America and
the  Caribbean  region is eligible  for tariff  reduction  or  elimination  upon
importation  to the United States under a program  known as the Caribbean  Basin
Initiative. Large ethanol producers, such as Cargill, have expressed interest in
building dehydration plants in participating Caribbean Basin countries,  such as
El Salvador, which would convert ethanol into fuel-grade ethanol for shipment to
the United States. Ethanol imported from Caribbean Basin countries may be a less
expensive alternative to domestically produced ethanol. Competition from ethanol
imported  from  Caribbean  Basin  countries  may affect our  ability to sell our
ethanol profitably, which would reduce the value of Members' investment.

     Competition  from  ethanol  imported  from  Brazil may be a less  expensive
     alternative  to our ethanol,  which would cause us to lose market share and
     reduce the value of Members' investment.

     Brazil is currently the world's  largest  producer and exporter of ethanol.
In Brazil,  ethanol is produced primarily from sugarcane,  which is also used to
produce  food-grade sugar.  Ethanol imported from Brazil may be a less expensive
alternative to domestically produced ethanol, which is primarily made from corn.
Tariffs   presently   protecting  U.S.  ethanol  producers  may  be  reduced  or
eliminated. Competition from ethanol imported from Brazil may affect our ability
to sell our  ethanol  profitably,  which  would  reduce  the  value of  Members'
investment.

Risks Associated With Government Regulation and Subsidization

     Federal regulations  concerning tax incentives could expire or change which
     could reduce our revenues.

     The federal government presently encourages ethanol production by taxing it
at a lower rate which will indirectly benefit us. The VEETC currently equates to
a $.51 per gallon  subsidy of ethanol which is available to  distributors.  Some
states and cities provide additional  incentives.  The Energy Policy Act of 2005
and  the  Energy  Independence  and  Security  Act of 2007  effectively  mandate
increases in the amount of annual ethanol  consumption in the United States. The
result is that the ethanol industry's  economic structure is highly dependent on
governmental  policies.  Although  current policies are favorable  factors,  any
major  change in federal  policy,  including  a decrease  in ethanol  production
incentives,  would have  significant  adverse  effects on our  proposed  plan of
operations  and might  make it  impossible  for us to  continue  in the  ethanol
business.

     Nebraska state producer  incentives are  unavailable to us, which places us
     at a competitive disadvantage.

     Neighboring states such as Nebraska have historically  provided  incentives
to ethanol producers, and may do so in the future.  Presently, we do not qualify
for any state-granted  incentives. To the extent that neighboring states provide
economic incentives to our competitors,  our ability to effectively compete with
such recipients will be reduced.

     We are subject to extensive environmental regulation and operational safety
     regulations that impact our expenses and could reduce our profitability.

     Ethanol  production  involves the emission of various airborne  pollutants,
including  particulate matters,  carbon monoxide,  oxides of nitrogen,  volatile
organic  compounds  and sulfur  dioxide.  We will be subject to  regulations  on
emissions  from  the  EPA and the  IDNR.  The  EPA's  and  IDNR's  environmental
regulations  are subject to change and often such  changes are not  favorable to
industry.  Consequently,  even if we have  the  proper  permits  now,  we may be
required  to invest  or spend  considerable  resources  to  comply  with  future
environmental regulations.


                                       28

     Our  failure  to  comply  or the  need to  respond  to  threatened  actions
involving  environmental laws and regulations may adversely affect our business,
operating  results  or  financial  condition.  Once our  ethanol  plant  becomes
operational  and as our  business  grows,  we will have to  develop  and  follow
procedures for the proper  handling,  storage,  and  transportation  of finished
products and materials  used in the  production  process and for the disposal of
waste products.  In addition,  state or local requirements may also restrict our
production and  distribution  operations.  We could incur  significant  costs to
comply with  applicable  laws and  regulations  as production  and  distribution
activity  increases.  Protection  of the  environment  will  require us to incur
expenditures for equipment or processes.

     We  could be  subject  to  environmental  nuisance  or  related  claims  by
employees,  property  owners or residents near the Facility  arising from air or
water discharges.  Ethanol production has been known to produce an odor to which
surrounding  residents could object. We believe our plant design should mitigate
most odor objections.  However,  if odors become a problem, we may be subject to
fines  and  could be  forced to take  costly  curative  measures.  Environmental
litigation  or  increased  environmental  compliance  costs could  significantly
increase our operating costs.

     We will be subject to federal and state laws regarding  operational safety.
Risks  of  substantial  compliance  costs  and  liabilities  are  inherent  in a
large-scale  construction  project  and in ethanol  production  after a plant is
constructed.  Costs and  liabilities  related to worker  safety may be incurred.
Possible  future  developments-including  stricter  safety  laws for  workers or
others, regulations and enforcement policies and claims for personal or property
damages resulting from our construction or operation could result in substantial
costs  and  liabilities  that  could  reduce  the  amount  of cash that we would
otherwise have to distribute to Members or use to further enhance our business.

     Carbon  dioxide  may be  regulated  by the  EPA  in  the  future  as an air
     pollutant, requiring us to obtain additional permits and install additional
     environmental   mitigation  equipment,   which  may  adversely  affect  our
     financial performance.

     Our  Facility  will emit  carbon  dioxide as a  by-product  of the  ethanol
production  process.  The United States Supreme Court recently classified carbon
dioxide as an air pollutant under the Clean Air Act in a case seeking to require
the EPA to regulate carbon dioxide in vehicle  emissions.  Similar lawsuits have
been filed seeking to require the EPA to regulate carbon dioxide  emissions from
stationary  sources  such as our  ethanol  plant  under the Clean Air Act.  Once
operational,  our Facility will produce a significant  amount of carbon  dioxide
that  will  be  vented  into  the  atmosphere.  While  there  are  currently  no
regulations  applicable to us concerning carbon dioxide,  if Iowa or the federal
government,  or any  appropriate  agency,  decides to  regulate  carbon  dioxide
emissions by plants such as ours, we may have to apply for additional permits or
we may be required to install carbon dioxide mitigation  equipment or take other
steps unknown to us at this time in order to comply with such law or regulation.
Compliance  with future  regulation of carbon  dioxide,  if it occurs,  could be
costly and may prevent us from  operating  the  Facility  profitably,  which may
decrease the value of our Units and Members' investment return.

     Our site borders nesting areas used by endangered bird species, which could
     impact our ability to successfully  acquire operating permits. The presence
     of these species,  or future shifts in its nesting areas,  could  adversely
     impact  construction  activities or have a negative impact upon our ability
     to construct  the  Facility at our site.  It could also  negatively  impact
     future operating performance.

     The Piping Plover (Charadrius  melodus) and Least Term (Sterna  antillarum)
use the fly ash ponds of the  existing  MidAm  power  plant  for  their  nesting
grounds. The birds are listed on the state and federal threatened and endangered
species lists.  Representatives of the IDNR have  preliminarily  determined that
our  plans to  construct  a rail line on the west edge of MidAm fly ash ponds to
serve the Facility  should not interfere  with the birds'  nesting  patterns and
behaviors,  based upon current  experiences  observed during the construction of
the  neighboring CB4 MidAm power plant.  However,  it may be necessary for us to
modify our construction schedules or plant site design to accommodate the birds'
patterns.  Of greater risk is the threat that  environmental  permits may not be
received,  or  received  on a timely  basis  if  Federal  or State  governmental
agencies  conclude that our plant may impair or negatively  impact bird habitat.
We may also have to alter  our  construction  schedule  to  accommodate  nesting
activities at certain times of the year. This could have a detrimental impact on
the project's economic viability.  In addition, we cannot foresee or predict the
birds' future  behaviors or status.  As such, we cannot say with  certainty


                                       29

that  endangered  species related issues will not arise in the future that could
negatively effect the plant's operations, or the valuation of Units.

     We may encounter or discover unforeseen  environmental  contaminants at our
     site.

     We completed a Phase One environmental  survey to determine the presence of
hazardous waste on the Facility site. While we believe the historical use of our
site has primarily been bare farmland,  a Phase Two environmental study (to test
for the presence of any contaminants that may have permeated the ground water or
leached into the soil as a consequence of any prior disposal or improper storage
by prior  occupants or  neighboring  businesses)  was  performed  and updated in
connection with the closing of our 2006 equity offering.  In the future,  should
such  contaminants  or hazards be  discovered,  we may be unable to utilize  the
Facility  site as we  intend  or we may incur  costs  for  cleanup  that are not
reflected in our  forecasted  sources and uses of funds  discussed  elsewhere in
this Registration statement.

     We may encounter  unforeseen  negative public sentiment of nearby residents
     who are opposed to the prospects of additional  manufacturing businesses in
     the area.

     While we do not expect that the ethanol plant will produce air emissions or
waste water that would  negatively  impact the nearby  residential  communities,
occupants of those  communities may choose to express negative  sentiment toward
the  addition  of another  major  manufacturing  plant in the  community  due to
misperceptions about the plant's expected  environmental  impact. Such reactions
could influence local zoning rules, impede construction, or result in unforeseen
costs related to education,  legal defense,  permitting, and other factors which
could adversely impact our anticipated expenses and reduce the value of Units.

     In the  future,  environmental  regulations  and  public  policy  regarding
     compliance  may  change,   adversely   affecting  the  Facility's  economic
     performance.

     Any future adverse changes in governmental  regulations  regarding emission
of carbon dioxide, water disposal, co-existence with endangered species or other
wildlife, or other factors, could result in unforeseen material costs or capital
expenditures  that  could  cause the  Company to fail to  generate  satisfactory
economic  results,  causing  devaluation of Units.  In addition,  any changes in
environmental  laws and regulations,  both at the federal and state level, could
require us to spend  considerable  resources in order to comply with such law or
regulation.  The expense of compliance may be  significant  enough to reduce our
profitability and negatively affect our financial condition.

Risks Related to Tax Issues in a Limited Liability Company

MEMBERS  SHOULD  CONSULT THEIR OWN TAX ADVISOR  CONCERNING THE IMPACT THAT THEIR
OWNERSHIP  IN US MAY  HAVE  ON  THEIR  FEDERAL  INCOME  TAX  LIABILITY  AND  THE
APPLICATION OF STATE AND LOCAL INCOME AND OTHER TAX LAWS TO OWNERSHIP OF UNITS.

     IRS  classification  of us as a  corporation  rather than as a  partnership
     would result in higher taxation and reduced profits, which could reduce the
     value of an investment in us.

     We are an Iowa limited  liability company that has elected to be taxed as a
partnership for federal and state income tax purposes,  with income, gain, loss,
deduction and credit passed through to our Members.  However,  if for any reason
the Internal Revenue Service ("IRS") would successfully determine that we should
be taxed as a corporation rather than as a partnership, we would be taxed on our
net income at rates of up to 35 percent for federal income tax purposes, and all
items of our income, gain, loss, deduction and credit would be reflected only on
our tax returns and would not be passed through to our Members. If we were to be
taxed as a corporation for any reason, distributions we make to our Members will
be  created  as  ordinary  dividend  income to the  extent of our  earnings  and
profits,  and the  payment of  dividends  would not be  deductible  by us,  thus
resulting in double  taxation of our earnings and profits.  If we pay taxes as a
corporation, we will have less cash to distribute to our Members.


                                       30

     The IRS may  classify  an  investment  in us as  passive  activity  income,
     resulting  in a Member's  inability  to deduct  losses  associated  with an
     investment in us.

     It is likely  that the IRS will  classify  an  interest  in us as a passive
activity. If a Member is either an individual or a closely held corporation, and
if a Member's  interest is deemed to be "passive  activity,"  then such Member's
allocated  share of any loss we incur will be deductible  only against income or
gains such Member has earned from other  passive  activities.  Passive  activity
losses that are  disallowed in any taxable year are suspended and may be carried
forward and used as an offset against  passive  activity income in future years.
These rules could  restrict a Member's  ability to  currently  deduct any of our
losses that are passed through.

     Income allocations assigned to Units may result in taxable income in excess
     of cash  distributions,  which means a Member may have to pay income tax on
     our Units with personal funds.

     Members  will pay tax on their  allocated  shares  of our  taxable  income.
Members may receive allocations of taxable income that result in a tax liability
that is in excess of any cash  distributions  we may make to the Members.  Among
other  things,  this result might occur due to accounting  methodology,  lending
covenants  contained  in the  Facility  that  restrict  our  ability to pay cash
distributions,  or our decision to retain the cash  generated by the business to
fund our  operating  activities  and  obligations.  Accordingly,  Members may be
required to pay some or all of the income tax on their  allocated  shares of our
taxable income with personal funds.

     An IRS audit could  result in  adjustments  to our  allocations  of income,
     gain, loss and deduction causing additional tax liability to our Members.

     The IRS may audit our income tax returns and may challenge  positions taken
for tax purposes and allocations of income, gain, loss and deduction to Members.
If the IRS were  successful  in  challenging  our  allocations  in a manner that
reduces  loss or  increases  income  allocable  to  Members,  Members  may  have
additional tax  liabilities.  In addition,  such an audit could lead to separate
audits of Members' tax returns,  especially if adjustments  are required,  which
could result in adjustments  on Members' tax returns.  Any of these events could
result in additional tax liabilities, penalties and interest to Members, and the
cost of filing amended tax returns.

Item 2. Financial Information.

Selected Financial Data

     The  following  selected  financial  data should be read  together with our
financial  statements and accompanying  notes and  "Management's  Discussion and
Analysis of Financial  Condition and Results of Operations"  appearing elsewhere
in this Registration  statement.  The selected financial data in this section is
not intended to replace our financial  statements and the accompanying notes. We
remain in the development stage at this time, and our historical results are not
necessarily  indicative of our future results.  The selected  financial data set
forth below are derived from (i) our audited statements of operations,  Members'
equity and cash  flows for the years  ended  September  30,  2007 and 2006,  the
period from March 28, 2005 (date of  inception)  to  September  30, 2005 and the
period from March 28, 2005 (date of inception)  to September  30, 2007;  (ii)our
audited  balance  sheets as of  September  30,  2007 and 2006,  (iii)  unaudited
statements of  operations,  Members'  equity and cash flows for the three months
ended  December  31, 2007 and 2006,  and the period from March 28, 2005 (date of
inception) to December 31, 2007 and (iv) from our unaudited  balance sheet as of
December 31, 2007, included elsewhere in this Registration statement.


                                       31

Statements of Operations Data:
                                                                                                      March 28, 2005
                                                                                    Three Months         (Date of
                                                             Three Months Ended    Ended December     inception) to
                                                              December 31, 2007       31, 2006      December 31, 2007
                                                                 Unaudited            Unaudited          Unaudited
-----------------------------------------------------------------------------------------------------------------------
Revenues                                                     $                 0  $              0  $                0
Expenses                                                               (598,246)         (189,279)         (3,741,356)
Other Income--Interest and Grants                                         93,066         1,208,893           3,537,026
Net Income (Loss)                                            $         (505,180)  $      1,208,893  $        (204,330)

Net Income (Loss) per Unit                                   $           (38.45)  $         115.56  $           (35.54)


                                                                                    March 28, 2005       March 28, 2005
                                                                  Year Ended           (Date of             (Date of
                                               Year Ended        September 30,      inception) to        inception) to
                                           September 30, 2007        2006         September 30, 2005    September 30, 2007
--------------------------------------------------------------------------------------------------------------------------
Revenues                                   $                0  $               0  $                0      $            0
Expenses                                           (2,222,327)          (886,824)            (33,959)         (3,143,110)
Other Income--Interest and Grants                    3,305,042            134,593               4,325          3,443,960
Net Income (Loss)                          $         1,082,715  $       (752,231)  $         (29,634)  $      300,850

Net Income (Loss) per Unit                 $            86.15  $          651.28  $           14,817      $        55.07

Balance Sheet Data:
                                                             December 31, 2007     September 30,      September 30,
                                                                  Unaudited            2007               2006
-----------------------------------------------------------------------------------------------------------------------
Assets:
     Cash and other current assets                           $        1,285,865  $       1,867,892  $         841,120
     Property and other equipment, net                               96,375,327         61,640,494          5,632,280
     Other assets                                                     4,675,495         18,439,388            165,275
Total Assets                                                 $      102,336,687  $      81,947,774  $       6,638,675

Liabilities and Members' Equity:
     Current liabilities                                     $       25,898,573  $       5,004,480  $         359,290
     Long term debt                                                     168,333            168,333          1,283,250
     Members' Equity                                                 76,269,781         76,774,961          4,996,135
Total Liabilities and Members' Equity                        $      102,336,687  $      81,947,774  $       6,638,675

Management's  Discussion  and  Analysis of  Financial  Condition  and Results of
Operations

     Liquidity and Capital Resources

     We  intend  to  rely  on our  current  equity  and  available  debt to fund
completion of the project,  cover start-up costs and purchase inventory prior to
our  operational  date. We will seek to issue equity to replace the Bridge Loan,
as further described below. Under the terms of the amended Credit Agreement, our
Lenders have agreed to fund the facility and we have  completed our initial draw
under the Construction Loan of $2,311,803.  Once operational, we anticipate that
cashflow from  operations  will allow us to operate at a profit and will provide
the  necessary  cash to make  our  principal  debt  and  interest  payments.  As
discussed   elsewhere  in  this  Registration   statement,   market  trends  and
governmental  regulations  could  have a  significant  impact on our  ability to
remain  profitable  and provide  enough  cashflow to make our debt and  interest
payments.


                                       32

     The  current  tightening  of the  credit  markets  and the  current  market
conditions  for both corn and  ethanol  could  materially  impede our ability to
obtain  additional  funding  if we need to raise  additional  equity  or  borrow
additional funds to make improvements to our Facility.

     We expect our future  cost of goods sold will  consist  primarily  of costs
relating to the corn supply  necessary to produce ethanol and Distillers  Grains
for sale.  Corn prices have  increased  sharply  since August 2006 and we expect
corn prices to remain at historical  high price levels well into 2008.  Although
we do not expect to begin  operations  until December,  2008, we expect the same
factors described elsewhere in this Registration  statement affecting demand for
corn will  continue to not only maintain  higher  prices,  but cause  continuing
volatility on those  prices,  which may  significantly  impact our cost of goods
sold.

     Once  operational,  we will be  dependent  on our supply of corn to produce
ethanol  and its  co-products  at our  Facility.  We expect the price of corn to
remain above  historical  price  levels and we will have to complete  with other
ethanol  plants for our corn  origination.  Generally,  higher  corn prices will
produce  lower profit  margins.  Grain prices are  primarily  dependent on world
feedstuffs supply and demand and on U.S. and global corn crop production,  which
can be volatile as a result of a number of factors,  the most important of which
are  weather,  current  and  anticipated  stocks and prices,  export  prices and
supports and the government's current and anticipated agricultural policy.

     The price at which we will purchase  corn will depend on prevailing  market
prices.  A shortage may develop,  particularly if there are other ethanol plants
competing for corn, an extended drought or other production problems. Historical
grain  pricing  information  indicates  that the price of grain  has  fluctuated
significantly in the past and may fluctuate significantly in the future. Because
the market price of ethanol is not related 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.   We,
therefore, anticipate that our plant's profitability will be negatively impacted
during periods of high corn prices.

     Recent Developments

     On  November  13,  2007,  the  Company  received  notification  from  Agent
requesting  that it  immediately  provide  the Agent  with a sworn  construction
statement  under the terms of the Credit  Agreement  in  response to our updated
project budget dated October 29, 2007,  which reflected a budgeted  shortfall of
$34,000,000.  Agent  further  requested  the  deposit  of  $34,100,000  with the
disbursing  agent under the Credit  Agreement and related  documents  within ten
days.  Thereafter,  the Company and Agent  commenced  discussions  regarding the
potential   construction   funding  gap   projected  in  our  October  29,  2007
construction  budget.  On January 3, 2008, we received  notification  from Agent
requesting  a firm  proposal  to address our equity  shortfall  along with other
materials.  As of March 7, 2008,  in order to resolve our funding  shortfall and
thereby allow the Agent to commence funding under the Credit Agreement,  we made
the following arrangements:

     o    We have  obtained a Bridge Loan from the Bridge  Lender in the maximum
          principal  amount of $36,000,000.  To remedy our budget  shortfall,  a
          drawing of  $34,100,000  under the Bridge Loan has been deposited into
          the Credit Agreement  construction  disbursing account and was applied
          as required thereunder. The Bridge Loan debt is secured by two letters
          of credit, described below.

     o    Bunge has  caused  its bank to issue a letter of credit in the  amount
          equal to 76% of the  maximum  principal  amount of the Bridge  Loan in
          favor of the Bridge  Lender (the "Bunge  LC"),  and ICM has caused its
          lender to  similarly  issue a letter of credit in the amount  equal to
          24% of the maximum principal amount of the Bridge Loan in favor of the
          Bridge  Lender  (the "ICM LC" and,  together  with the  Bunge LC,  the
          "LCs").  Both LCs will expire on March 16, 2009, and the Bridge Lender
          will only draw against the LCs to the extent that we default under the
          Bridge  Loan or if we have not repaid the Bridge Loan in full by March
          1, 2009.  In the event the Bridge  Lender  draws  against the LCs, the
          amounts drawn will be in  proportion  to Bunge's and ICM's  respective
          ownership of the Company's  Units which are not Series A--76% and 24%,
          respectively.  As we repay the principal of the Bridge Loan,  the LCs'
          stated amounts will automatically be reduced in the same proportion.


                                       33

     o    Effective March 7, 2008, we have entered into a Series C Unit Issuance
          Agreement  with ICM (the  "Series  C  Agreement")  and a Series E Unit
          Issuance Agreement with Bunge (the "Series E Agreement", together with
          the Series C Agreement,  the "Unit Issuance Agreements") in connection
          with their  respective  issuances of the LCs.  Under the Unit Issuance
          Agreements,  we have  agreed  to pay  Bunge and ICM each a fee for the
          issuances of their respective LCs equal to 6% per annum of the undrawn
          face amount of their  respective  LCs.  The Unit  Issuance  Agreements
          provide  that the  Company  will use its best  efforts to raise  funds
          through a subsequent private placement offering of Units (the "Private
          Placement"),  or such  other form of equity or debt  financing  as the
          Company's  Board  of  Directors  may  deem  necessary,  in  an  amount
          sufficient  to pay off the  Bridge  Loan in full  prior  to  maturity.
          Although we anticipate that funds obtained from the Private  Placement
          or such other equity or debt  financing  will enable us to pay off the
          Bridge Loan in full prior to  maturity,  in the event that the LCs are
          drawn upon as  discussed  above or if Bunge or ICM make any payment to
          the Bridge  Lender that reduces  amounts owed by the Company under the
          Bridge  Loan  (each,  a  "Bridge  Loan  Payment"),  the Unit  Issuance
          Agreements  provide that we will  immediately  reimburse  Bunge and/or
          ICM, as  applicable,  for the amount of such  Bridge  Loan  Payment by
          issuing Units to Bunge and ICM, as further described below.

     o    Under the Series C Agreement,  if ICM makes a Bridge Loan Payment, the
          Company will  immediately  issue Series C Units to ICM based on a Unit
          price  that is equal to the  lesser of $3,000 or one half (1/2) of the
          lowest  purchase  price paid by any party for a Unit who  acquired (or
          who has entered into any agreement, instrument or document to acquire)
          such  Unit as part of the  Private  Placement  after  the  date of the
          Series C Agreement  but prior to the date of any Bridge  Loan  Payment
          made by ICM.  The Series C Agreement  further  provides  that ICM will
          have the right to purchase  its pro rata share of any Units  issued by
          the Company at any time after the date of the Series C Agreement.

     o    Under the Series E  Agreement,  if Bunge makes a Bridge Loan  Payment,
          the Company will immediately  issue Series E Units to Bunge based on a
          Unit  price that is equal to the lesser of $3,000 or one half (1/2) of
          the lowest  purchase  price paid by any party for a Unit who  acquired
          (or who has  entered  into any  agreement,  instrument  or document to
          acquire) such Unit as part of the Private  Placement after the date of
          the  Series E  Agreement  but  prior to the  date of any  Bridge  Loan
          Payment made by Bunge.  The Series E Agreement  further  provides that
          Bunge will have the right to purchase  its pro rata share of any Units
          issued  by the  Company  at any time  after  the date of the  Series E
          Agreement.

     o    The  Operating  Agreement has been amended to reflect the terms of the
          Unit Issuance Agreements.

     o    As described in more detail below,  the terms of the Credit  Agreement
          have been modified to reflect the foregoing.

     To the  extent we issue  additional  Units to Bunge  and/or ICM in order to
satisfy our  reimbursement  obligations under the Unit Issuance  Agreements,  or
raise additional equity through the Private Placement or other equity financing,
the ownership interests of the Company's Members would be diluted.

     We have  retained  an  investment  banking  firm to assist us in  obtaining
additional  equity to replace the Bridge Loan.  While the Bridge Loan is not due
until  March 1, 2009,  our goal is to raise  sufficient  equity to  replace  the
Bridge  Loan  as  soon  as  possible.  Initially,  we are  seeking  one or  more
institutional  investors to provide the  additional  equity.  The Board may also
determine  to make an  offering  to  existing  Members  and other  investors  to
compliment the additional institutional equity.

     Sources of Funds

     The total project cost to construct our Facility and commence operations is
currently  estimated  to be  approximately  $225,000,000,  assuming  no  unknown
material  changes  are  required.  To  date,  we have  planned  to  finance  the
construction  of the Facility with a combination of equity and debt capital.  We
have  financed  additional  construction  costs  that led to our  recent  budget
shortfall with the Bridge Loan, which we intend to pay in full prior to maturity
with the  proceeds  of the  Private  Placement  or other  equity  financing,  as
discussed above. We initially raised equity from our seed capital  investors and
completed a secondary  private  offering in March 2006. We intend to draw on our
debt  financing  under the terms of the Credit  Agreement,  as amended,  and the
Bridge  Loan.  We have


                                       34

also  received  grant income from the United States  Department  of  Agriculture
("USDA") and a loan from the IDED. The following schedule sets forth the sources
of funds from our equity offering  proceeds and our debt financing  proceeds and
grants:

Source of Funds                                          Amount         Percent of Total
     Equity:
         Member Equity (Seed Capital Offerings)      $      1,650,000        0.74  %

         Member Equity (Secondary Offering)          $     74,004,000       32.94  %

     Other:
         Interest, Grant and Other Income            $      3,881,000        1.72  %

     Total Equity and Other                          $     79,535,000       35.40  %

     Debt:
         Term Debt                                   $    111,000,000       49.40  %
         Bridge Loan                                 $     34,100,000       15.20  %
     Total Debt                                      $    145,100,000       64.60  %
------------------------------------------------------------------------------------
Total                                                $    224,635,000         100  %

     Equity Financing

     For financing  purposes,  we have issued Units in three separate offerings:
(i) in an offering commencing in October 2005, we issued 285 Units at $2,000 per
Unit to our founding Members,  resulting in gross proceeds of $570,000;  (ii) in
an offering commencing in November 2005, we issued 360 Units at $3,000 per Unit,
resulting in gross  proceeds of $1,080,000;  (iii) in an offering  commencing in
February, 2006, we issued (A) 8,000 Series A Units at $6,000 per Unit, resulting
in gross  proceeds of  $48,000,000,  (B) 1,000 Series C Units to ICM at $6,000 a
Unit, resulting in gross proceeds of $6,000,000, and (C) 3,334 Series B Units to
Bunge at  $6,000  per Unit,  resulting  in gross  proceeds  of  $20,004,000.  In
exchange for services,  we issued 45 Series A Units each to the three principals
of Rural Development Associates, and we issued 25 Series A Units to Iowa Quality
Producers Alliance,  LLC. Additional  information respecting these offerings can
be found below under Item 10 "Recent Sales of  Unregistered  Securities."  Under
the Unit Issuance  Agreements,  we may be required to issue  additional Units to
Bunge and ICM in the event the LCs are drawn  upon,  and have  agreed to use our
best efforts to raise additional  capital through the Private Placement or other
equity financing.

     Other Income

     In addition to our equity  financing,  the Credit  Agreement and the Bridge
Loan, we have earned approximately $3,336,000 of interest income, and rental and
grant income of approximately $228,000, through December 31, 2007.

     Debt Financing

     In May 2007,  we  closed on our debt  financing  with  Agent,  as agent for
Lenders. Our debt financing is principally governed by the Credit Agreement with
Lenders,  along  with other  agreements,  which  were  amended  March 7, 2008 in
connection  with  the  Bridge  Loan.  The  Credit   Agreement   provides  for  a
$111,000,000  construction  loan  which is  convertible  into a term  loan  (the
"Construction Loan"), at a variable interest rate of LIBOR (the London Interbank
Offered  Rate) plus 3.65%.  The Credit  Agreement  requires that we make monthly
principal  payments  commencing seven months following the date the Construction
Loan converts to a term loan (60 days after  completion of  construction  of the
Facility) (the "Conversion  Date"). On the Conversion Date, the Credit Agreement
provides that the Construction  Loan will be converted into a term loan of up to
$101,000,000  (the "Term Loan") and a term  revolving  loan of up to $10,000,000
(the "Term Revolver"); and up to 50% of the outstanding Construction Loan can be
converted to a fixed rate term loan ("Fixed Rate Loan"). In addition, the Credit
Agreement  provides for a revolving line of credit of approximately  $15,000,000
(the "Revolving Line of Credit").


                                       35

The Revolver provides for a variable interest rate of LIBOR plus 3.45%. Finally,
the Credit  Agreement  provides for a loan up to $1,000,000 on a revolving basis
(the  "Swingline  Revolver").  Under the  Amended  Credit  Agreement,  we are to
provide no less than 51% of the cost of construction. The principal terms of the
Amended  Credit  Agreement  and  related  loan  agreements  with the Lenders are
summarized below.

     o Construction Loan: The Construction Loan will bear interest of LIBOR plus
365  basis  points,  determined  on  the  date  of  the  first  advance  of  the
Construction Loan, and the interest rate will be adjusted as of the first day of
the month  following  a change in the LIBOR  rate.  We will pay  interest on the
Construction  Loan in arrears on a monthly  basis,  paid on the first day of the
month for the previous  month's  interest.  These  payments  will start upon the
first day of the month following the first advance under the Construction  Loan,
and will continue  until the conversion of the  Construction  Loan, as described
above.

     o Term Loan: On the Conversion Date, up to $101,000,000 of the Construction
Loan can be  converted  to the Term Loan.  The Term Loan will carry an  interest
rate equal to LIBOR plus 345 basis points, to be reset on the first of the month
following the month in which the LIBOR rate  changes.  The Term Loan becomes due
on the fifth  anniversary  of the  Conversion  Date.  Under the Term Loan,  once
funded,  we will pay  interest  only for the first six months.  Beginning in the
seventh month following  conversion,  we will pay principal and interest,  in an
amount that fully amortizes the principal of the Term Loan over 114 months.  The
Term  Loan,  if  funded,  must be paid in full on the fifth  anniversary  of the
Conversion Date (the "Maturity Date").

     o Fixed Rate Loan: If we provide notice to the Agent at least 30 days prior
to the Conversion  Date, we may convert up to 50% of the outstanding  debt under
the  Construction  Loan to the Fixed  Rate Term Loan,  for which the  applicable
interest will be the rate listed in the  "Government  Agency and Similar Issues"
section of the Wall  Street  Journal  for the  Federal  Farm  Credit Bank or the
Federal Home Loan Bank,  having a maturity  approximately  equal to the Maturity
Date, plus 325 basis points.

     o  Term  Revolver:  On  the  Conversion  Date,  up to  $10,000,000  of  the
Construction  Loan can be converted to the Term  Revolver for cash and inventory
management  purposes.  Additional  advances under the Term Revolver,  creating a
total outstanding balance of up to $10,000,000, are allowed on a revolving basis
up until the day before the Maturity  Date. The interest of the Term Revolver is
equal to  LIBOR  plus 345  basis  points,  adjusted  on the  first of the  month
following the rate change.  Once funded, we must pay interest monthly in arrears
on the Term  Revolver,  with the total  outstanding  balance due on the Maturity
Date.

     o  Revolving  Line of  Credit:  The  Lenders  may also  provide us with the
Revolving Line of Credit. Under the terms of the Credit Agreement, the Revolving
Line of Credit  can be issued in an amount up to the  lesser of (i)  $15,000,000
and (ii) after  operations at the Facility begin, the sum of 75% of our Eligible
Accounts  Receivable  (as  defined  in the  Credit  Agreement),  plus 75% of our
Eligible  Inventory (as defined in the Credit Agreement) (the greater of the two
constitutes  the "Borrowing  Base").  The interest rate on the Revolving Line of
Credit,  once funded,  is equal to LIBOR plus 345 basis points,  adjusted on the
first of the month following a rate change.  The Revolving Line of Credit is due
in full on the 364th day after the  Conversion  Date.  Once  funded,  we will be
subject to a mandatory prepayment ("Mandatory Prepayment") on the Revolving Line
of Credit in an amount equal to the amount by which the Revolving Line of Credit
exceeds the Borrowing Base, reassessed on a monthly basis. In the alternative to
paying the Mandatory Prepayment, we can grant to the Lenders a security interest
in additional collateral.

     o Swingline  Revolver:  The Swingline Revolver would carry an interest rate
of LIBOR plus 345 basis points,  adjusted on the first of the month  following a
rate change. The Swingline Revolver, once funded, would be due at the earlier of
the Maturity Date or 30 days after the advance is made.

     o Interest Rate Modifications: After the Conversion Date, all variable rate
loans will carry an interest rate based on the  percentage of the Facility which
is represented by equity,  such that if such percentage is: (i) equal to or less
than 55%, the interest  rate is LIBOR plus 345 basis  points,  (ii) greater than
55% but less than or equal to 65%,  the  interest  rate is LIBOR  plus 320 basis
points,  (iii) greater than 65% but less than or equal to 75%, the interest rate
is LIBOR plus 295 basis points,  and (iv) greater than 75%, the interest rate is
LIBOR plus 275 basis points.


                                       36

     o  Disbursing  Account  Deposit  and Reserve  Funds:  To resolve our budget
shortfall, we agreed to deposit $34,100,000 into the Credit Agreement disbursing
account (the "Disbursing Account Deposit"), which we funded with the proceeds of
the Bridge Loan. $3,253,722 of this amount represents a reserve for any costs to
complete  our  Facility  that may exceed our  projected  costs (the  "Contingent
Project Cost Reserve").  In addition, the Credit Agreement provides that we will
deposit into the Credit  Agreement  disbursing  account the first  $5,000,000 we
raise from any  equity  offering  (the  "Equity  Escrow  Fund").  Following  any
disbursement to us of Project Cost Reserve funds, the Credit Agreement  provides
that we will replenish the  Contingent  Project Cost Reserve with funds from the
Equity  Escrow  Fund,  if any.  On the  Conversion  Date,  the Credit  Agreement
provides  that we may use any funds  remaining  in the  Contingent  Project Cost
Reserve or the Equity Escrow Fund to repay the Bridge Loan. The Credit Agreement
further  provides  that to the extent our actual  total  costs to  complete  the
Facility are less than our projected  costs,  the difference will be advanced to
us on the  Conversion  Date to repay any  outstanding  balances under the Bridge
Loan.

     o Certain Repayment Provisions: In addition to all other payments due under
the Credit Agreement,  we also agreed to pay,  beginning at the end of the third
fiscal quarter after the Conversion  Date, the amount equal to 65% of our Excess
Cash Flow (as defined in the Credit Agreement),  up to a total of $4,000,000 per
year, and $16,000,000 over the term of the Credit  Agreement.  Such payment will
be applied to the outstanding principal of the Term Loan (once funded), and will
not  be  subject  to  the  prepayment  fee.  The  prepayment  fee  is due if the
Construction  Loan or Term  Loan is paid in full  within  24  months  after  the
Conversion  Date.  We also agreed to pay to each Lender,  annually,  a letter of
credit fee equal to 150 basis points of each Lender's  maximum amount  available
to us under  its  letter of  credit.  We will pay a  commitment  fee of 35 basis
points per year of the unused portion of each Lender's Revolving Commitment,  as
defined  in  the  Credit   Agreement,   and  payable  in  arrears  in  quarterly
installments.  The  repayment  of any loan will be made to the  Lenders pro rata
based on each Lender's  contribution to the total outstanding  principal of that
loan.

     o Other Terms: Under the terms of the Credit Agreement,  we are required to
make certain customary  representations and are subject to customary affirmative
and negative  covenants,  including  restrictions  on our ability to incur debt,
create  liens,   dispose  of  assets,   pay   distributions   and  make  capital
expenditures,  consolidate,  dissolve, or merge. There are also customary events
of default,  including  payment  defaults,  covenant  defaults,  cross defaults,
construction related defaults and bankruptcy  defaults.  The terms of the Credit
Agreement also contain  financial  covenants  including minimum working capital,
certain reserves,  minimum current assets to current liabilities ratios, minimum
tangible net worth,  minimum  owner's  equity ratio,  and a minimum fixed charge
coverage ratio.

     o  Security  Agreement:  We entered  into a Security  Agreement  ("Security
Agreement") with AgStar dated May 2, 2007 under which we grant to AgStar, as the
agent  ("Agent")  for the  Lenders,  a security  interest in all of our personal
property,  including accounts,  goods, farm products,  fixtures,  chattel paper,
inventory,  equipment,  Instruments,  Investment  Property,  Documents,  Deposit
Accounts,  Commodity  Accounts,  Commercial  Tort Claims,  securities  accounts,
money,  letter-of-credit rights, intangibles,  software, Supporting obligations,
and all proceeds and products thereof.  Under the Security Agreement,  we agreed
to not grant any other lien or security interest in any of our personal property
without the consent of Agent. The Security  Agreement  contains customary events
of default and remedies for an event of default.

     o Real Estate  Mortgage:  We entered into a Mortgage,  Security  Agreement,
Assignment of Rents and Leases, and Fixture Filing ("Mortgage  Agreement") dated
May 2, 2007 with AgStar as Agent.  Under the Mortgage  Agreement,  we granted to
Agent a first lien status, subject to certain permitted  encumbrances,  mortgage
and security interest in (i) our real property, described therein, together with
all  improvements,  buildings  or  structures,  (ii)  all  equipment,  fixtures,
improvements, building supplies and materials and other personal property, (iii)
all  leases  accounts  rents,  issues  and  profits,  (iv) any and all awards or
judgments,  and (v) after-acquired  property. The Mortgage Agreement also serves
as a financing  statement for a fixture filing.  The Mortgage Agreement contains
the same events of default as are  contained in the Credit  Agreement,  and also
contains standard remedy provisions for a mortgage and security interest.

     o  Environmental  Indemnity  Agreement:  We entered  into an  Environmental
Indemnity  Agreement  with  AgStar  as  Agent,  dated  May  2,  2007,  where  we
represented we have received a Phase I  environmental  assessments,  and that we
provided  these  assessments  to the Lenders.  We covenant that we will promptly
commence  and  complete


                                       37

cleanup,  consistent with the appropriate  laws, any  environmentally  hazardous
materials.  In  addition,  we agreed to  indemnify  each  Lender  for all losses
arising as a result of or in  connection  with the  presence of  environmentally
hazardous materials, including providing the defense of any Lender for a related
action or proceeding.

     o  Lien  Subordination  Agreement:  We  entered  into a Lien  Subordination
Agreement with AgStar as Agent, and the Iowa Department of Economic  Development
("IDED").  Lenders and IDED each  posses  security  interests  in certain of our
property.  Under the Lien  Subordination  Agreement,  IDED and the Lenders agree
that IDED will have first  priority  and the Lenders  will have second  priority
with respect to specified collateral (the "IDED Collateral"). IDED agrees not to
take  any  action  regarding  the  security  interest  it  contains  in the IDED
Collateral.  Additionally,  IDED agrees to subordinate its security  interest in
our assets except IDED Collateral to the security  interest held by the Lenders.
This agreement  terminates  upon (i) the debt to the Lenders being paid in full,
(ii)  the  termination  of  the  credit  extended  by  Lenders,   or  (iii)  the
cancellation of the loan and security  interest and termination of the financing
statement held by IDED.

     o Assignments:  Pursuant to the Credit  Agreement,  we agreed to assign our
rights  under the  following  agreements,  to which  each of the  counterparties
provided their respective consent: the ICM Contract, the Ethanol Agreement,  the
DG  Agreement,  the  Agency  Agreement,  the  Steam  Contract  and the  Electric
Contract.

     o Bridge Loan: As discussed above, in addition to the funds available under
the Credit  Agreement,  we have also  obtained  the Bridge  Loan from the Bridge
Lender and deposited a $34,100,000 advance under the Bridge Loan into the Credit
Agreement disbursing account to resolve our budget shortfall. The Bridge Loan is
represented  by a  promissory  note dated as of March 7, 2008 (the  "Bridge Loan
Note") and  carries a variable  interest  rate of 0.800  percentage  points over
LIBOR. The Bridge Loan Note provides that we are required to pay all outstanding
principal  and accrued  unpaid  interest on or before  March 1, 2009.  Under the
terms  of  the  Bridge  Loan,   we  are  required  to  make  certain   customary
representations and are subject to certain affirmative covenants,  including the
obligation  to notify  the  Bridge  Lender  of any  defaults  under  the  Credit
Agreement.  There  are also  customary  events  of  default,  including  payment
defaults,  covenant defaults,  defaults in favor of third parties and bankruptcy
defaults.  In the event of our default  under the Bridge  Loan,  the Bridge Loan
Note  provides  that the Bridge  Lender  shall  submit  draws under the LCs on a
proportionate  basis  (76%  under to the  Bunge LC and 24% under the ICM LC) and
apply such  proceeds to the amount due under the Bridge Loan. To the extent that
we make any  principal  payment on the Bridge Loan that is  permitted  under the
Credit  Agreement,  the Bridge Loan Note  provides  that the Bridge  Lender will
consent  to and  acknowledge  a  reduction  in the face  amount of the LCs by an
amount equal to the applicable proportionate share of such principal payment.

     Governmental Programs

     o IDED: We entered into a Master  Contract (the "IDED  Contract")  with the
IDED,  effective November 21, 2006, which provides for financial assistance from
IDED.

     The awards  granted under the IDED Contract can be reduced or terminated if
there is a change  in the IDED  revenues  appropriated  to us under  the  Master
Contract or for any other reason beyond IDED's control. All amounts of financing
received from IDED will be spent on the construction of our Facility. As part of
the Master Contract,  we granted to IDED a second position  security interest in
all of our assets,  and a first position  security interest in our rolling stock
valued at  $200,000.  We covenant to (i)  maintain  our business and Facility in
Iowa, (ii) create certain  numbers of jobs,  based on the job category (the "Job
Requirement"),  (iii) provide certain  benefits,  (iv) complete the Facility and
comply with performance requirements regarding its completion,  (v) maintain our
properties in a condition of good repair,  (vi) pay all taxes,  assessments  and
fees,  and (vii) insure our risks as any person  similarly  situated  would.  We
agree to provide  reports  including a mid-year  status  report,  an end-of-year
status report,  an end of project report,  and an end of job maintenance  period
report.   Additionally,   we  agreed  to  not  be  a  party  to  any  merger  or
consolidation,  we agree to not sell, transfer, or lease any property covered by
a security  interest,  and we agreed to not form or acquire any  subsidiaries or
transfer any assets pledged as security to any  subsidiary.  The Master Contract
contains  standard  events of  default,  and in  addition  declares  an event of
default  when we are  subject  to any  judgment  in excess of  $100,000,  in the
aggregate.


                                       38

     The IDED  Contract  contains  a  VAAPFAP  Funding  Agreement  ("VA  Funding
Agreement"),  which provides us with an interest-free loan of $100,000,  payable
over 60 months,  and a $100,000  forgivable  loan,  payable over 36 months.  The
forgivable loan is only due if IDED determines that we failed to comply with the
terms of the VA Funding  Agreement  and the IDED  Contract.  In  addition to the
requirements for funding under the IDED Contract,  we must also provide evidence
that we have access to steam  energy from MidAm's  plant to replace  natural gas
before we will  receive  funds under the VA Funding  Agreement.  In the event we
fail to meet our Job Requirement,  IDED can either require full repayment of the
loan or repayment on a pro rata basis.  If we fail to meet our Job  Requirement,
the  forgivable  loan will be forgiven on a pro rata basis,  with the  remaining
balance being  amortized over a two year period and carrying a 6% interest rate,
due from the first day of disbursement of the shortfall  amount.  We have signed
two promissory notes,  each for $100,000,  covering the loans provided for under
the VA Funding  Agreement.  The VA Funding  Agreement  terminates  upon (i) IDED
determining  we  have  fully  met  all of  the  requirements  of the VA  Funding
Agreement,  including  repayment,  (ii) an event of  default,  (iii) lack of any
distribution  under the VA Funding Agreement within 24 months of the award date,
or (iv) mutual agreement.

     The IDED Contract also contains a High Quality Job Creation Program Funding
Agreement ("HQJCP Funding Agreement"). Under the HQJCP Funding Agreement, we are
allowed to claim an  investment  tax credit  ("Tax  Credit") of up to 5% (with a
maximum of $6,922,308) of our qualifying  expenses  directly related to new jobs
created by the start-up, location,  expansion, or modernization of our Facility,
we are  eligible  for a  refund  of  sales,  service,  and use  taxes  we pay to
contractors  or  subcontractors,  and  we are  eligible  for a  value-added  tax
exemption. Under the HQJCP Funding Agreement, we must create 45 new high quality
jobs.  These new jobs must be created  within five years of Facility  completion
and must be maintained for at least two years thereafter.  We also agree to make
a qualifying  investment of $141,331,160 toward the purchase and construction of
our  Facility.  Additionally,  we must (i) offer our new  employees a pension or
profit  sharing  plan,  (ii)  create  a high  value-added  good  or  service  in
"Value-Added  Agriculture"  (one of Iowa's  target  industries),  (iii)  provide
employees 90% of the cost of medical and dental insurance,  and (iv) have active
productivity  and safety  programs.  If we fail to create the number of required
jobs,  then we will be  required  to repay  these tax  benefits  pro rata to the
percent of jobs we failed to create  over the number of jobs we are  required to
create. If we fail to meet the four  requirements  above for two years in a row,
then we forfeit all tax benefits we receive under the HQJCP  Funding  Agreement.
If we sell or dispose of any building,  land, or structure that has received tax
incentives  under this  program,  then our tax  liability  will be  increased as
outlined in the HQJCP  Funding  Agreement.  In the event we layoff  employees or
close our Facility  prior to  receiving  any tax  benefits,  the benefits may be
reduced or terminated by IDED. The HQJCP Funding  Agreement  terminates upon (i)
IDED  determining we have fully met all of the requirements of the HQJCP Funding
Agreement,  including  repayment,  (ii) an event of  default,  (iii) lack of any
distribution  under the HQJCP  Funding  Agreement  within 24 months of the award
date, or (iv) mutual agreement.

     o USDA:  We have entered into a  Value-Added  Agricultural  Product  Market
Development (VAPG) Grant Agreement ("Grant Agreement") with the United States of
America,  dated  November 3, 2006,  under which we receive a $300,000  grant for
payment of (i) administrative  staff salaries during  construction and start-up,
(ii) the rental of temporary  office space,  and (iii)  permanent staff salaries
for three months. As a condition to receiving the grant, we agreed to contribute
at least  $300,000 of our own money to be spent at an equal or greater rate than
the Grant  Agreement  funds.  We also agree to maintain a  financial  management
system and receive payment in accordance with federal regulations. Additionally,
we  agreed  to  comply  with  certain  bonding  coverage,  audit  and  reporting
obligations.  Finally, we agreed to comply with federal  regulations  concerning
property, procurement and records access.


                                       39

     Uses of Funds

     The  following  table  describes the estimated use of our offering and debt
financing  proceeds.  The figures  are  estimates  only,  and the actual uses of
proceeds may vary significantly from the descriptions given below.

Estimated Uses of Funds                                              Amount            Percent of Total
Plant Construction                                               $    118,000,000              50.4  %
Other Construction                                               $     68,250,000              24.1  %
Land and Site Development                                        $     10,779,000               3.6  %
Site Utilities, Fire Protection and Water Supply                 $      3,894,000               0.5  %
Rolling Stock                                                    $      2,000,000               0.9  %
Administration Building, Computer Systems and Furnishings        $      1,040,000               0.4  %
Rail line                                                        $     11,635,000               4.5  %
Construction Insurance                                           $        400,000               0.2  %
Equity and Debt Financing Expenses+                              $      1,414,000               0.4  %
Organizational                                                   $      5,424,000               1.4  %
Start-Up                                                         $      1,799,000               1.4  %
------------------------------------------------------------------------------------------------------
Total                                                            $    224,635,000               100  %

+ Does not include  additional  expenses we may incur to raise additional equity
as discussed elsewhere in this Registration statement.

     The ICM  Contract  provides  for a fixed fee of  $118,000,000  to build the
primary  portions of our Facility.  Through  December 31, 2007, we have paid ICM
$48,042,404  for   construction   services  under  the  ICM  Contract,   leaving
$69,957,569 of future commitment,  which we expect to pay by October,  2008. The
T&S Contract  provides for a fee,  subject to change  orders,  of  $9,745,000 to
design and construct a 1,000,000 bushel grain receiving and storage facility and
Distillers Grain storage facility.  The work provided for under the T&S Contract
is to be substantially completed no later than May 5, 2008. Through December 31,
2007,  we have paid T&S  $7,400,000,  leaving a  $2,345,000  future  commitment.
Additionally,  we have agreed to pay $5,759,240 for excavation services. Through
December  31,  2007,  we have paid  $5,700,000  under the  excavation  contract,
leaving a $59,000 future commitment.

     Contractual Obligations

     The following  table shows certain of our  contractual  obligations,  as of
December 31, 2007.

Contractual Obligations                                        Payments Due by Period
                                  Less than 1
                                     Year           1 -3 Years       3 - 5 Years    More than 5 Years      Total
------------------------------- -- ------------- -- -------------- -- ------------- -- --------------- -- ------------
Long Term Debt Obligations      $     1,303,250  $             --  $       108,333  $              --  $    1,411,583
Capital Lease Obligations       $            --  $             --  $            --  $              --  $           --
Operating Lease Obligations     $     1,383,386  $     16,084,391  $    16,074,000  $      20,092,500  $   53,634,277
Purchase Obligations:
     Plant Construction         $    73,985,000  $             --  $            --  $              --  $   73,985,000
     Other Construction         $     4,208,099  $             --  $            --  $              --  $    4,208,099
Other Long-term Liabilities
Reflected on Company's
Balance Sheet                   $            --  $             --  $            --  $              --  $           --

------------------------------- -- ------------- -- -------------- -- ------------- -- --------------- -- ------------
Total Contractual Obligations:  $    80,879,735  $     16,084,391  $    16,182,333  $      20,092,500  $  133,238,959


                                       40

Quantitative and Qualitative Disclosures About Market Risk

     In  addition  to  risks  inherent  in our  development  and  operations  as
discussed  elsewhere  in this  Registration  statement,  we will be  exposed  to
various market risks once we become  operational.  The primary market risks will
arise as a result of possible  changes in interest  rates and certain  commodity
prices.

     Commodities

     Once  operational,  we will be exposed to market  risk with  respect to the
price of ethanol, our principal product, and the price and availability of corn,
the principal commodity used by us to produce ethanol. Our other primary product
is Distillers Grains, and we will also be subject to market risk with respect to
the price for distillers grains.

     In general,  rising ethanol and  Distillers  Grains prices should result in
higher profit margins,  and therefore  represent  favorable  market  conditions.
Ethanol and Distillers Grains prices are, however, influenced by various factors
beyond  the  control  of our  management,  including  the  supply and demand for
gasoline,   the   availability  of  substitutes  and  the  effect  of  laws  and
regulations.

     Generally speaking,  rising corn prices will result in lower profit margins
and, accordingly, would represent unfavorable market conditions. For example, if
corn  costs were to  increase  $.50 per  bushel  from one year to the next,  the
impact on our operating  income would be  approximately  $19.65  million for the
year.  Once  operational,  we will generally not be able to pass along increased
corn  costs to our  ethanol  customers.  The  availability  and price of corn is
subject to wide  fluctuations  due to various  unpredictable  factors  which are
beyond our control,  including weather  conditions,  farmer planting  decisions,
governmental policies with respect to agriculture and local, regional,  national
and  international  trade,  demand and  supply.  Over the five year  period from
September 30, 2001 through September 30, 2006, corn prices (based on the Chicago
Board of Trade  ("CBOT")  daily  futures  data)  ranged  from a low of $1.86 per
bushel in November 2005 to a high of $3.35 per bushel in April 2004, with prices
averaging  $2.30 per bushel over that five year  period.  During our fiscal year
ended  September  30, 2007,  corn prices  (based on the CBOT daily futures data)
ranged  from a low of $3.085 per bushel in July to a high of $4.37 per bushel in
February.  On December 7, 2007, the CBOT price per bushel of March 2008 corn was
$ 4.115.  Once we are  operational,  we estimate that corn costs will  represent
approximately 70% of our total annual cost of goods.

     Another  important raw material for the production of our ethanol is steam,
as it will account for about 95% of our heat energy  needs (we estimate  that we
will need to utilize  natural gas during  periods which steam is not  available,
estimated  to be  approximately  5% of the  time).  Our cost per MMbtu for steam
under  our Steam  Contract  is fixed for three  years,  but  thereafter  will be
subject to various fixed and periodic adjustments, and such adjustments could be
material.  Once we are fully  operational,  we  estimate  that steam  costs will
represent approximately 8% of our total annual cost of goods.

     The  extent to which we may enter  into  arrangements  with  respect to our
ethanol or corn during the year may vary  substantially  from time to time based
on a number of factors,  including supply and demand factors affecting the needs
of  customers or  suppliers  to purchase  ethanol or sell us raw  materials on a
fixed basis,  our views as to future market trends,  seasonable  factors and the
cost of futures contracts.

     The following  represents a sensitivity  analysis that estimates our annual
exposure to market risk with respect to our anticipated  corn  requirements  and
ethanol  sales.  Market risk is estimated as the  potential  impact on operating
income  resulting  from a  hypothetical  10.0%  change in the fair  value of our
anticipated corn  requirements and ethanol sales. The following does not account
for any forward  contracts  we may enter into in the future to hedge market risk
with respect to our anticipated corn, steam and other requirements.  The results
of this analysis, which may differ from actual results, are as follows:


                                       41

                        Estimated at
                       Risk Volume (1)                         Hypothetical                         Change in Annual
                        (in millions)          Units          Change in Price     Spot Price (2)    Operating Income
--------------------- ------------------ ------------------- ------------------ ------------------- ------------------
Corn                        39.3               Bushel              $0.50              $5.30            $19,650,000
Ethanol                      110               Gallon              $0.10              $2.42            $11,000,000

(1)  The  volume  of corn  is  based  on the  assumption  that  we will  produce
     110,000,000 gallons of ethanol annually.
(2)  Current  spot  prices  include  the CBOT  price per gallon of ethanol as of
     March 18, 2008 and the price per bushel of corn as of as of March 19, 2008.

     Interest Rates


     In addition to certain outstanding  non-interest bearing debt which is owed
to  the  IDED  in the  amount  of  $200,000,  we  have  incurred  the  following
outstanding debt as of March 11, 2008, at the interest rates indicated:

Outstanding Loans       Principal Amount Outstanding     Interest Rate
------------------------------------------------------------------------------
Construction Loan                $2,311,803              LIBOR + 3.65%
Bridge Loan                      $34,100,000              LIBOR + 0.8%

     Because  the  Construction  Loan and Bridge  Loan are  subject to  variable
interest rates, we are exposed to market risk related to changes in the interest
rate imposed under those loan  agreements  and  promissory  notes.  The interest
rates under the  Construction  Loan and the Bridge Loan will adjust according to
movements of the LIBOR.  As of March 11, 2008,  the interest rate  applicable to
the  outstanding  principal  amount  of the  Construction  Loan is 6.59% and the
interest rate  applicable to the Bridge Loan is 3.74%.  Assuming a  hypothetical
increase of 1% in the  foregoing  interest  rates,  the  Company  would incur an
additional per annum interest expense of  approximately  $400,118 on the amounts
currently drawn under the Construction Loan and the Bridge Loan.

     When we make further  draws on the  Construction  Loan and draw down on our
other loans provided under the Credit Agreement,  we will likewise be exposed to
market risk  related to changes in the interest  rate  imposed  under those loan
agreements and promissory notes. The extent of such market risk will depend upon
how we borrow funds under the Credit  Agreement.  The Credit Agreement  provides
for the following  loans up to the following  maximum  amounts,  at the interest
rates indicated:

                              Maximum Principal Amount Under
Credit Agreement Loan                Credit Agreement                  Interest Rate
----------------------------- -------------------------------- -------------------------------
Construction Loan                      $111,000,000                    LIBOR + 3.65%
Term Loan                              $101,000,000                    LIBOR + 3.45%
Fixed Rate Loan                         $55,500,000              Gov't Agency Rate + 3.25%
Term Revolver                           $10,000,000                    LIBOR + 3.45%
Revolving Line of Credit        Lesser of Borrowing Base or            LIBOR + 3.45%
                                        $15,000,000
Swingline Revolver                      $1,000,000                     LIBOR + 3.45%

     The  interest  rates  under all of the Credit  Agreement  loans will adjust
according to the  movements of the LIBOR and the  Government  Agency and Similar
Issues rate listed in the Wall Street Journal. Assuming we borrowed $111,000,000
under the  Construction  Loan,  $10,000,000  under the Term Revolver  Loan,  and
$15,000,000  under the Revolving line of Credit Loan, and assuming the LIBOR and
the Government Agency Rate was 3.0% per annum, a hypothetical  increase of 1% in
the  interest  rates  under  the  foregoing  loan  agreements  would  result  in
additional  interest expense of approximately  $1,143,250 during the fiscal year
ending September 30, 2009.

     We have no  international  sales.  All of our purchases are  denominated in
U.S. dollars.


                                       42

     Impact of Inflation

     Because we remain a  development  stage  company,  inflation  has not had a
material impact on our results of operations since  inception.  We cannot assure
you that inflation will not have an adverse impact on our operating  results and
financial condition in future periods.

     Off-Balance Sheet Arrangements.

     We have no off-balance sheet arrangements.

     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.

Item 3. Properties.

     We have  purchased  the Facility  site located near Council  Bluffs,  Iowa,
which  consists  of three  parcels  totaling  274.90  acres.  This  property  is
encumbered under the Mortgage  Agreement with Lenders.  Additionally,  we remain
obligated  to pay the seller,  Pottawattamie  County,  Iowa,  the balance of the
purchase price for our Facility's  site in the amount of $1,283,250,  by January
31, 2008. We lease temporary office space in Council Bluffs, we lease a building
on the Facility site to an unrelated third party,  and lease 55.202 acres on the
south end of the property to an unrelated third party for farming.

Item 4. Security Ownership of Certain Beneficial Owners and Management.

     As of December  31, 2007,  there were 8,805 Series A Units,  3,334 Series B
Units, and 1,000 Series C Units issued and outstanding. The following table sets
forth  certain  information  as of December 31,  2007,  with respect to the Unit
ownership  of:  (i) those  persons  or groups  (as that term is used in  Section
13(d)(3) of the  Securities  Exchange  Act of 1934,  as amended  (the  "Exchange
Act"))  who  beneficially  own more than 5% of any  Series  of Units,  (ii) each
Director of the Company,  and (iii) all  Officers and  Directors of the Company,
nine in number, as a group. Unless otherwise  provided,  the address of those in
the  following  table is 2101 42nd  Avenue,  Council  Bluffs,  Iowa  51501-8409.
Messrs.  King,  Drake,  Patterson  and Bauer serve in the  capacity of executive
officers.  Except as noted below,  the persons  listed below possess sole voting
and investment power over their respective Units. The following does not reflect
any Units which may be issued to Bunge and ICM, respectively, under the terms of
the Unit Issuance Agreements.


                                       43

                                                              Amount and Nature of Beneficial
 Title of Class            Name of Beneficial Owner                      Ownership                 Percent of Class
------------------ ----------------------------------------- ----------------------------------- ---------------------

    Series A                      Ted Bauer                             36 Units(1)                     0.41%
    Series A                    Hubert Houser                           39 Units(2)                     0.44%
    Series A                      Karol King                            20 Units(3)                     0.23%
    Series A                   Brad Petersburg                            62 Units                      0.70%
    Series A                    Michael Guttau                          12 Units(4)                     0.14%
       --                         Mark Drake                                -0-                           --
       --                      Cindy Patterson                              -0-                           --
       --                        Bailey Ragan                               -0-                           --
       --                       Michael Scharf                              -0-                           --
       --                        Greg Krissek                               -0-                           --
    Series B              Bunge North America, Inc.                      3334 Units                      100%
    Series C                      ICM, Inc.                              1000 Units                      100%

    Series A        All Officers and Directors as a Group                169 Units                      1.92%

------------------------------------

(1)  These  Series A Units are owned  jointly by Mr.  Bauer and his wife,  Donna
     Bauer.
(2)  These Series A Units are owned  jointly by Mr.  Houser and his wife,  Paula
     Houser.
(3)  These  Series A Units are owned  jointly by Mr. King and his wife,  Rozanne
     King.
(4)  These Series A Units are owned jointly by Mr.  Guttau and his wife,  Judith
     Guttau.

Item 5. Directors and Executive Officers.

     The Directors and / or officers listed below under "Independent Directors &
Officers"  meet the  "independent  director"  standards  applicable to companies
listed on the Nasdaq Capital  Market (though the Company's  Units are not listed
on any exchange or quotation system). Contrariwise, those Directors listed below
under "Interested  Directors" do not meet the "independent  director"  standards
applicable to companies listed on the Nasdaq Capital Market.  With the exception
of Mr. Scharf, who serves on the Board of Directors of Patriot Coal Corporation,
none of the Directors  listed below have served on the board of directors of any
other company  having a class of securities  registered  under Section 12 of the
Exchange  Act or subject to the  requirements  of Section  15(d) of the Exchange
Act, nor have any of our Directors served as directors of an investment  company
registered  under  the  Investment  Company  Act of 1940.  Under  the  Company's
Operating  Agreement,  the independent  Directors' terms are staggered such that
one Director will be up for election every year.


                                       44

Independent Directors & Officers

                    Position(s)      Term of Office
      Name         Held with the     and Length of                         Principal Occupation(s)
    and Age           Company         Time Served                            During Past 5 Years
----------------- ---------------- ------------------- -----------------------------------------------------------------

Karol King, 61    Series A         Term expires        Corn  and  soybean  farmer  near  Mondamin,  Iowa,  since  1967;
                  Director and     2009, Director      President,   King  Agri  Sales,  Inc.  (marketer  of  chemicals,
                  Chairman         since November,     fertilizer  and  equipment)  since 1995;  President,  Kelly Lane
                                   2006                Trucking,   LLC,  since  2007.  Mr.  King  attended  Iowa  State
                                                       University  and has served on the  Harrison  County  Farm Bureau
                                                       Board,  the Iowa Corn  Growers  Board,  the Iowa Corn  Promotion
                                                       Board,  the US Feed Grains Council Board,  the National  Gasohol
                                                       Commission, and the National Corn Growers Association Board.

Ted Bauer,  55    Series  A        Term  expires       Director,  Secretary  and  Treasurer  of the Company  from March
                  Director         2008, Director      2005;  Owner and  operator  of a farming  operation  and hunting
                  Secretary and    and officer since   Secretary  and and officer since  preserve  near Audubon,  Iowa,
                  Chairman         March 2005          since 1977;  Co-Founder,  and from Treasurer  March 2005 2005 to
                                                       2007,  Director,  Templeton  Rye  Spirits  LLC;  Director,  Iowa
                                                       Quality  Producers  Alliance,  since 2003; Vice President,  West
                                                       Central Iowa Rural Water, from 2002 to 2007. Mr. Bauer has an Ag
                                                       Business degree from Iowa State  University and is a graduate of
                                                       the Texas A&M TEPAP program.

Hubert Houser,    Series A         Term expires        Lifetime  owner  of farm and  cow-calf  operation  located  near
65                Director         2010, Director      Carson,  Iowa.  Mr.  Houser has  served in the Iowa  Legislature
                                   since 2005          since 1993, first in the House of Representatives  and currently
                                                       in the  Senate.  Mr.  Houser  also  served on the  Pottawattamie
                                                       County Board of Supervisors  from 1979 to 1992,  director of the
                                                       Riverbend  Industrial  Park,  and  was a  founder  of  the  Iowa
                                                       Western Development Association and Golden Hills RC&D.
Michael Guttau,   Series A         Term expires        Vice Chairman  (since 2004),  Chairman,  Audit Committee (2004 -
61                Director         2011, Director      2006) and  Chairman,  Risk  Management  Committee  (since 2007),
                                   since 2007          Federal  Home  Loan  Bank of Des  Moines;  since  1972,  various
                                                       positions with Treynor State Bank, currently President,  CEO and
                                                       Chairman of the Board;  Superintendent of Banking, Iowa Division
                                                       of Banking,  1995 - 1999;  Director,  Iowa Bankers  Association,
                                                       Iowa Bankers Mortgage  Corporation,  Iowa Student Loan Liquidity
                                                       Corp.,  Iowa Business  Development  Finance Corp.  and Iowa Seed
                                                       Capital  Liquidation  Corp.;  President,   Southwest  Iowa  Bank
                                                       Administration  Institute.  Mr. Guttau  received his B.S.,  Farm
                                                       Operation,  from Iowa State  University  in 1969,  and completed
                                                       numerous  U.S.  military  education  programs in 1969,  1970 and
                                                       1978.


                                                           45

Interested Directors

                    Position(s)     Term of Office+
      Name         Held with the     and Length of                         Principal Occupation(s)
    and Age           Company         Time Served                            During Past 5 Years
----------------- ---------------- ------------------- -----------------------------------------------------------------

Bailey Ragan,     Series B         Since November 1,   Various  positions with Bunge North America,  Inc. for more than
52++               Director and     2006               25 years,  currently Vice President and General  Manager,  Bunge
                  Vice Chairman                        Grain.


Michael Scharf,   Series B         Since November 1,   Senior Vice President and CFO, Bunge North America,  Inc., since
60++               Director         2006               1989.

Greg Krissek,     Series C         Since November 1,   Director  of  Governmental   Affairs,  ICM,  Inc.,  since  2006;
45++               Director         2006               Director  of  Marketing  and  Governmental  Affairs,  United Bio
                                                       Energy,  from 2003 to 2006;  Chairman,  National Ethanol Vehicle
                                                       Coalition, since 2007; Secretary-Treasurer of the Board, Ethanol
                                                       Promotion and Information Council since 2004;  director,  Kansas
                                                       Association  of Ethanol  Processors  since 2004;  Kansas  Energy
                                                       Council,  since 2004 prior Director of  Operations,  Kansas Corn
                                                       Commission;    Assistant   Secretary,   Kansas   Department   of
                                                       Agriculture,  1997 to 2000.  Mr.  Krissek  represents ICM on the
                                                       boards of six additional private ethanol companies.  Mr. Krissek
                                                       received  his B.A. in Economics  from  Rockhurst  University  in
                                                       Kansas City and his Juris Doctor and MBA from the  University of
                                                       Denver.



+ The Interested  Directors'  terms do not have a specified  number of years, as
these Directors are nominated by the Series B Member and the Series C Member, as
discussed further below under Items 7 and 11.

++ The  information  provided  below under Item 7,  "Certain  Relationships  and
Related  Transactions,  and Director  Independence,"  respecting the election of
Messrs. Ragan, Scharf and Krissek as Directors, is incorporated into this Item 5
by reference.


                                       46

Executive Officers

      Name        Position(s) Held     Length of                          Principal Occupation(s)
    and Age       with the Company    Time Served                           During Past 5 Years

Mark Drake, 49    President and    Since January,      Global  Sales and  Marketing  Manager - Ethanol,  Phibro  Animal
                  Chief            2007                Health Corporation (global  manufacturer of antimicrobials) from
                  Executive                            2004 - 2006; Corporate Account Manager,  Novozymes North America
                  Officer                              (global  biotech  manufacturer  of food an  industrial  enzymes)
                                                       from 2002 -2004;  Marketing  Manager,  Chief Ethanol Fuels, Inc.
                                                       (fuel grade ethanol  manufacturer)  from 2001 - 2002.  Mr. Drake
                                                       received  his  Associate of Science,  Chemistry  degree from the
                                                       College of Lake County.

Cindy             Chief            Since July, 2007    Controller,  Golden Triangle Energy,  L.L.C.  (ethanol producer)
Patterson, 48     Financial                            from 2000 - 2007; auditor, Profit Management  Consultants,  1995
                  Officer                              - 1999; staff accountant,  Mitchell  Williams,  1994 - 1995. Ms.
                                                       Patterson  received  her  BBA  degree  from  the  University  of
                                                       Georgia,  a  Post  Baccalaureate  in  Accounting  from  Southern
                                                       Indiana  University  and an MBA in  Management  from Golden Gate
                                                       University.

Item 6. Executive Compensation.

Corporate Governance / Compensation Committee

     The  Corporate   Governance  /  Compensation   Committee  (the  "Governance
Committee")  operates under a written  charter,  which the Governance  Committee
approved on February 15,  2007,  and which was adopted by the Board of Directors
on February 16, 2007 (the "Governance  Charter").  The Governance Charter is not
available on the Company's  website.  The Governance  Charter  provides that the
Governance Committee will annually review and approve the Company's compensation
program for its Directors,  officers and managers.  The Governance  Charter does
not exclude from the Governance  Committee's membership Directors who also serve
as officers of the Board or  Interested  Directors.  Presently,  the  Governance
Committee's  membership  consists of Messrs.  Scharf (Chair),  Bauer, Houser and
King. Accordingly, Messrs. Bauer and King did participate in recommending to the
Board the  Compensation  Policy.  The  Governance  Charter does provide that the
Governance   Committee   may  form  and   delegate   its   responsibilities   to
subcommittees,  and the  Governance  Charter does not  contemplate  (nor does it
prohibit) the use of compensation consultants to assist the Governance Committee
in its determination of Director, officer and managers' compensation.

Compensation of Executive Officers

     The Company does not currently provide any Unit options,  Unit appreciation
rights,  non-equity  incentive  plans,  non-qualified  deferred  compensation or
pension  benefits  to  its  executive  officers.  The  Governance  Committee  is
responsible for designing,  reviewing and overseeing the  administration  of the
Company's  executive  compensation  program.  As a  development  stage  company,
certain  elements  of our  executive  compensation  system  have  not  yet  been
established.  Pursuant  to the  Governance  Charter,  the  Governance  Committee
approved the  compensation  terms for Mr. Drake and Ms. Patterson when they were
hired in 2007.

     The  compensation  of our two senior  executives is designed to achieve the
following objectives:  (i) support our business goals of completing construction
of our ethanol facility and commencing  operations;  (ii) align the interests of
executive officers and our Unit holders; (iii) attract, retain and motivate high
caliber  executive  officers;   and  (iv)  pay  for  performance  by  linking  a
significant  amount of executive  compensation  to  individual  contribution  to
selected metrics of our business plan.

     As described below, in addition to cash  compensation,  the Company intends
to develop an  equity-based  compensation  opportunity  for our key  executives.
While the equity  compensation plan has not yet been developed,


                                       47

certain  aspects  of  the  equity  compensation  program  are  outlined  in  our
agreements  with  the  two  executives.  The  Company  intends  to  provide  our
executives with a level of benefits that is competitive with benefits of similar
executive  positions  in the  Company's  geographic  region for the biofuels and
agribusiness  sector in which the Company  competes.  To this end, the Committee
anticipates  developing  the following  compensation  plans for our  executives:
annual cash  incentives,  long-term  equity-based  incentives and retirement and
welfare benefits.

     The  following  discusses  the main  elements  of  compensation  under  our
agreements with our two senior officers.

     o Base Salary: A portion of annual cash compensation is paid as base salary
     to provide a level of security and stability. Mr. Drake is paid $150,000 in
     base salary  under his  employment  agreement,  and Ms.  Patterson  is paid
     $90,000 in base salary under her employment  agreement.  Base salaries will
     be reviewed on an annual basis.

     o Annual Cash Incentive:  The Company expects that a significant portion of
     the  annual  cash  compensation  paid  to the  executive  officers  will be
     directly  related to the  achievement of individual  performance  goals and
     contributions.  Awards  would first be available  for 2008,  payable in the
     following  year.  The  Committee  has not  yet  established  the  incentive
     criteria  generally or the specific  details for our two current  executive
     officers.  For our CEO, it is anticipated  that the minimum target for cash
     incentive compensation is 25 percent of annual salary.

     o  Long-Term  Incentive  Compensation:  The  Company  intends  to develop a
     long-term incentive  compensation program for our senior executives,  which
     will include an equity component.

     o Retirement and Welfare  Benefits:  The Company  anticipates  that it will
     implement a 401(k) Plan, a tax qualified  retirement  plan, but has not yet
     done so. The Company has  implemented  a basic  benefits  plan for all full
     time employees,  including medical,  dental,  life insurance and disability
     coverage.

     o Relocation and other Benefits:  Mr. Drake received a relocation allowance
     of $30,000,  which was intended to defray costs  associated  with moving to
     Council Bluffs and transition  expenses.  Ms.  Patterson will be reimbursed
     for moving expenses,  up to a maximum of $5,000 and also received a $25,000
     signing bonus. Mr. Drake is provided with the use of a company vehicle.

     o  Severance  and  Change-in-Control  Benefits:  Mr.  Drake is  entitled to
     receive  six-months  of base  salary  and  target  bonus  in  circumstances
     including a change of control of the Company.

                           Summary Compensation Table

     The  following  table  provides  all  compensation  paid  to our  executive
officers in fiscal year 2007. None of our officers received any bonus,  stock or
option awards, non-equity incentive plan compensation,  or nonqualified deferred
compensation in fiscal year 2007.

                                                                   Non-Equity
                                                                   Incentive     Nonqualified
Name and                                        Stock   Option        Plan         Deferred      All Other
Principal        Fiscal                Bonus    Awards  Awards    Compensation   Compensation   Compensation  Total
Position          Year    Salary ($)     ($)     ($)      ($)         ($)        Earnings ($)       ($)        ($)
---------------- -------- ------------ -------- ------- -------- --------------- -------------- ------------ ---------

Mark Drake,
President and
CEO               2007     $150,000      $0       $0      $0           $0             $0         $37,080+    $187,080

Cindy
Patterson, CFO    2007      $90,000      $0       $0      $0           $0             $0         $25,000++    $115,000

+ This amount  constitutes  reimbursements for the officer's  relocation  expenses in the amount of $30,000 and the
cost of providing the officer with a vehicle in the approximate amount of $7,080 for fiscal year 2007.
++ This amount is a signing bonus for the officer.

Compensation of Directors

     The Company does not provide its Directors with any equity or equity option
awards,  nor  any  non-equity  incentive  payments  or  deferred   compensation.
Similarly,   the  Company  does  not  provide  its  Directors   with  any  other
perquisites,  "gross-ups,"  defined  contribution  plans,  consulting fees, life
insurance  premium  payments  or  otherwise.


                                       48

Following  recommendation by the Company's  Corporate  Governance / Compensation
Committee and  subsequent  approval by the Board on March 16, 2007,  the Company
pays its  Directors  the  following  amounts  (collectively,  the  "Compensation
Policy"):  (i) each Director  receives an annual retainer of $12,000,  (ii) each
Director  receives  $1,000  per Board  meeting  attended  (whether  in person or
telephonic), and (iii) once our plant is operational, each Director will receive
$3,000 per Board meeting  attended  (whether in person or telephonic),  provided
that the foregoing  amounts in (i) - (iii) shall not exceed $24,000 per Director
in any calendar year. Additionally,  the following amounts are paid to Directors
for specified  services:  (i) the Chairman of the Board is paid $7,500 per year,
(ii) the Chairman of the Audit Committee and Audit Committee Financial Expert is
paid $5,000 per year, (iii) the Chairmen of all other Committees are paid $2,500
per year, and (iv) the Secretary of the Board is paid $2,500 per year.

     Independent Directors

     The following table lists the  compensation the Company paid in Fiscal Year
2007  to  its  Directors  who  are  considered   "independent"  under  standards
applicable  to  companies  listed  on the  Nasdaq  Capital  Market  (though  the
Company's  Units are not  listed  on any  exchange  or  quotation  system)  (the
"Independent Directors").

                           Fees Earned or Paid                           Equity or Non-Equity
          Name                   in Cash         All Other Compensation       incentives                Total
------------------------- ---------------------- ----------------------- ---------------------- ----------------------

Ted Bauer                        $24,708                   $0                     $0                   $24,708
Hubert Houser                    $23,250                   $0                     $0                   $23,250
Karol King                       $28,875                   $0                     $0                   $28,875
Michael Guttau                   $16,917                   $0                     $0                   $16,917

     Interested Directors

     The following table lists the  compensation the Company paid in Fiscal Year
2007 to its  Directors  who are not  considered  "independent"  under  standards
applicable  to  companies  listed  on the  Nasdaq  Capital  Market  (though  the
Company's  Units are not  listed  on any  exchange  or  quotation  system)  (the
"Interested Directors").

                           Fees Earned or Paid                           Equity or Non-Equity
          Name                   in Cash         All Other Compensation       incentives                Total
------------------------- ---------------------- ----------------------- ---------------------- ----------------------

Bailey Ragan+                    $24,292                   $0                     $0                   $24,292
Michael M. Scharf+               $22,292                   $0                     $0                   $22,292
Greg Krissek                     $21,000                   $0                     $0                   $21,000
Brad Petersburg++                   $0                     $0                     $0                     $0

+ The  Directors  fees payable to Messrs.  Ragan and Scharf are paid directly to
Bunge at such Directors'  request,  and Messrs.  Ragan and Scharf do not receive
any  compensation  from the  Company  for their  service  as  Directors.
++ Mr. Petersburg's term as Director concluded in March, 2007.

Compensation Committee Interlocks and Insider Participation

     Presently, the Governance Committee's membership consists of Messrs. Scharf
(Chair),  Bauer (the Company's  Treasurer and  Secretary),  Houser and King (the
Board Chairman). No executive officers of the Company served, during Fiscal Year
2007: (i) on a  compensation  committee of another entity which had an executive
officer  serving on the  Governance  Committee;  (ii) as a  director  of another
entity which had an executive  officer serving on the Governance  Committee;  or
(iii) as a member of a  compensation  committee  of another  entity which had an
executive officer who served as a Director of the Company.

Item  7.  Certain   Relationships   and  Related   Transactions,   and  Director
          Independence.

     Our founders and original directors acted as our promoters and provided our
seed  capital in our  October  2005  Offering,  discussed  below under "Item 10.
Recent Sales of Unregistered  Securities."  Those promoters include


                                       49

David Denne, Don Harris,  McGraw Brothers Farm, Ted Bauer, Billie Wilson, Hubert
and Paula  Houser,  Jim  Anderson,  Bill and Karen  Johnson,  Marvin and Roberta
Reents,  Doug Beckman,  Craig Becker,  Brent Bierbaum,  Harold Hoffman,  Joseph,
Hoye, Liljedahl Farms, David Rydberg,  Scotch Hills, Inc., Randy and Jill Euken,
and Greg Zellmer.

     On  November  1,  2006,  in   consideration  of  its  agreement  to  invest
$20,004,000  in the  Company,  Bunge  purchased  the only  Series B Units of the
Company  under an  arrangement  whereby the Company would (i) enter into various
agreements  with  Bunge  or  its  affiliates  discussed  below  for  management,
marketing and other services to the Company,  and (ii) have the right to elect a
number of Series B Directors which are  proportionate  to the number of Series B
Units owned by Bunge,  as compared to all Units.  Bunge elected Bailey Ragan and
Michael  Scharf  as the  Series B  Directors  on  November  1,  2006.  Under the
Company's Operating Agreement, the Company may not, without Bunge's approval (i)
issue additional Series B Units, (ii) create any additional Series of Units with
rights  which are  superior to the Series B Units,  (iii)  modify the  Operating
Agreement to adversely  impact the rights of Series B Unit holders,  (iv) change
the  Company's  status from one which is managed by managers,  or change back to
manager management in the event the status is changed to member management,  (v)
repurchase  or redeem  any Series B Units,  (vi)  cause the  Company to take any
action  which would  cause a  bankruptcy,  or (vii)  approve a transfer of Units
allowing the  transferee  to hold more than 17% of the  Company's  Units or to a
transferee which is a direct competitor of Bunge.

     Additionally,  as discussed  in more detail  above under Item 2.  Financial
Information--Recent Developments, Bunge has caused its bank to issue a letter of
credit in an amount equal to 76% of the maximum  principal  amount of the Bridge
Loan in favor of the Bridge Lender as security for the Bridge Loan. The Bunge LC
will expire on March 16, 2009,  and the Bridge Lender will only draw against the
Bunge LC to the extent that we default  under the Bridge Loan or have not repaid
the Bridge Loan in full by March 1, 2009.  In the event the Bridge  Lender draws
against  the Bunge LC,  the  amounts  drawn  will be in  proportion  to  Bunge's
ownership of the Company's Units which are not Series  A--currently 76%. As part
of the foregoing  arrangement  with Bunge, the Company entered into the Series E
Agreement on March 7, 2008,  pursuant to which the Company has agreed (i) to pay
Bunge a fee for the  issuance  of the  Bunge  LC  equal  to 6% per  annum of the
undrawn  face amount of the Bunge LC and (ii) to  reimburse  Bunge with Series E
Units to the  extent  that the Bunge  makes a Bridge  Loan  Payment,  as further
described below.

     Under the Series E  Agreement,  if Bunge makes a Bridge Loan  Payment,  the
Company  will  immediately  issue  Series E Units to Bunge based on a Unit price
that is equal to the lesser of $3,000 or one half  (1/2) of the lowest  purchase
price paid by any party for a Unit who  acquired  (or who has  entered  into any
agreement,  instrument or document to acquire) such Unit as part of any offering
of Units after the date of the Series E  Agreement  but prior to the date of any
Bridge Loan Payment made by Bunge. The Series E Agreement  further provides that
Bunge will have the right to purchase  its pro rata share of any Units issued by
the Company at any time after the date of the Series E Agreement.

     To the extent that the Company  issues Series E Units to Bunge  pursuant to
the Series E Agreement,  the  Company's  Operating  Agreement  provides (i) that
Bunge,  as a Series E Member,  is entitled to elect one additional  director (to
the extent that Bunge owns  between  21% and 29% of the total  Units  issued and
outstanding) two additional directors (to the extent that Bunge owns between 30%
and 39% of the total Units issued and outstanding) or three additional directors
(to the  extent  that  Bunge  owns 40% or more of the  total  Units  issued  and
outstanding);  and (ii) that the Company may not,  without Bunge's  approval (a)
issue additional  Series E Units, (b) create any additional Series of Units with
rights  which are  superior  to the Series E Units,  (c)  modify  the  Operating
Agreement to adversely  impact the rights of Series E Unit  holders,  (d) change
the Company's  status from one which is managed by managers,  or vice versa, (e)
repurchase  or redeem  any  Series E Units,  (f) cause the  Company  to take any
action  which  would  cause a  bankruptcy,  or (g)  approve a transfer  of Units
allowing the  transferee  to hold more than 15% of the  Company's  Units or to a
transferee which is a direct competitor of Bunge.

     The Company and Bunge  entered  into the DG  Agreement on October 13, 2006.
The DG Agreement  provides that Bunge will purchase all of the Distillers Grains
produced by us over a term of 10 years, beginning when we commence production of
Distillers  Grains,  with automatic renewals for three-year terms unless a party
provides six months' notice.  Bunge will pay us for the Distillers  Grains,  but
retain amounts for transportation  costs, rail lease


                                       50

charges and marketing fees. We have agreed to pay a minimum annual marketing fee
to Bunge in the amount of  $150,000.  After the third year of the DG  Agreement,
the parties may make adjustments to the prices.

     The  Company  and Bunge  entered  into an  Agreement  on October  13,  2006
respecting  the use of  Bunge's  grain  elevator  in Council  Bluffs,  Iowa (the
"Elevator  Agreement").  The Elevator  Agreement does not require the payment by
the  Company of any moneys and  otherwise  did not  involve  the  payment of any
consideration by either party;  rather,  it imposes  restrictions on the use and
possible  disposition by Bunge of its grain elevator  located in Council Bluffs,
Iowa,  including a right of first  refusal in favor of the Company.  The parties
entered into the Elevator  Agreement as part of their overall  arrangement under
which Bunge initially agreed to invest in the Company.

     The  Company  and a company in which  Bunge  holds a  membership  interest,
AGRI-Bunge,  LLC,  entered into the Agency  Agreement on October 13, 2006. Under
the Agency Agreement,  we agreed to pay an agency fee to A-B for corn delivered,
subject to an annual minimum fee of $225,000, for A-B's service of procuring all
grain  requirements  for our plant.  The Agency  Agreement will commence when we
first require corn, presently projected to be in the fourth quarter of 2008, and
will then continue for 10 years with  automatic  renewals for three year periods
unless  a  party  provides  notice  to  not  renew  within  six  months  of  the
then-current  term.  After  three  years  from the  commencement  of the  Agency
Agreement, the annual minimum payment may be adjusted.

     On January 30, 2008, the Company and Bunge entered into a Support  Services
Agreement  (the  "Services  Agreement"),  under  which  Bunge  agreed to provide
engineering  support on the  project,  provide  reports to Lender and assist the
Company with requests by the Agent. The Company will pay, in addition to Bunge's
out of pocket  expenses,  an hourly fee of $95 for such  services.  The Services
Agreement  terminates  upon the earlier of  completion  of the ethanol  plant or
December 31, 2008.  Bunge may terminate the Services  Agreement at any time, and
the Company may terminate under specified circumstances.

     On June 25, 2007, we entered into the Railcar  Agreement with Bunge for the
sub-lease  of 320  ethanol  cars and 300  DDGS  cars  which  will be used in the
delivery  and  marketing  of ethanol and DDGS.  We will be  responsible  for all
maintenance and mileage charges as well as the monthly lease expense and certain
railcar  modification  expenses.  Under the  Railcar  Agreement,  we will  lease
railcars for terms  lasting 120 months and  continuing on a month to month basis
thereafter.  The Railcar  Agreement  will  terminate  upon the expiration of all
railcar leases.

     On November 1, 2006, in consideration of its agreement to invest $6,000,000
in the Company,  ICM became the sole Series C Member of the Company.  As part of
ICM's  agreement  to  invest  in the  Company's  Series C Units,  the  Company's
Operating  Agreement provides that it will not, without ICM's approval (i) issue
additional  Series C Units,  (ii)  create  any  additional  Series of Units with
rights  senior to the Series C Units,  (iii) modify the  Operating  Agreement to
adversely  impact the rights of Series C Unit  holders,  or (iv)  repurchase  or
redeem any Series C Units.  Additionally,  ICM, as the sole Series C Unit owner,
is afforded the right to elect one Series C Director to the Board so long as ICM
remains a Series C Member.  Greg Krissek was elected as the Series C Director by
ICM on November 1, 2006.

     Additionally,  as discussed  in more detail  above under Item 2.  Financial
Information--Recent  Developments,  ICM has caused its bank to issue a letter of
credit in an amount equal to 24% of the maximum  principal  amount of the Bridge
Loan in favor of the Bridge  Lender as security for the Bridge Loan.  The ICM LC
will expire on March 16, 2009,  and the Bridge Lender will only draw against the
Bunge LC to the extent that we default  under the Bridge Loan or have not repaid
the Bridge Loan in full by March 1, 2009.  In the event the Bridge  Lender draws
against the ICM LC, the amounts drawn will be in  proportion to ICM's  ownership
of the  Company's  Units which are not Series  A--currently  24%. As part of the
foregoing  arrangement with ICM, the Company entered into the Series C Agreement
on March 7, 2008,  pursuant  to which the Company has agreed to (i) to pay ICM a
fee for the  issuance  of the ICM LC equal to 6% per annum of the  undrawn  face
amount of the ICM LC and (ii) to reimburse ICM with additional Series C Units to
the extent that ICM makes a Bridge Loan Payment, as further described below.

     Under the  Series C  Agreement,  if ICM makes a Bridge  Loan  Payment,  the
Company will immediately  issue Series C Units to ICM based on a Unit price that
is equal to the lesser of $3,000 or one half (1/2) of the lowest  purchase price
paid  by any  party  for a Unit  who  acquired  (or  who has  entered  into  any
agreement,  instrument or document to acquire) such Unit as part of any offering
of Units after the date of the Series C  Agreement  but prior to


                                       51

the date of any Bridge Loan Payment made by ICM. The Series C Agreement  further
provides  that ICM will have the  right to  purchase  its pro rata  share of any
Units  issued  by the  Company  at any  time  after  the  date of the  Series  C
Agreement.

     On September 25, 2006,  the Company  entered ICM Contract  with ICM,  under
which ICM has  contracted  to  construct a 110 million  gallon per year dry mill
ethanol plant. The ICM Contract contains a lump-sum price of $118,000,000. Under
the ICM Contract,  the Company was required to make a down payment of 10% of the
original  contract  price,  of which  $2,000,000 was paid at the delivery of the
parties'  letter of intent,  an additional  $2,000,000 was paid in November 2006
when the Company broke escrow,  and the remaining  $7,800,000  was paid when the
Company delivered to ICM a notice to proceed on January 23, 2007.

     Brad Petersburg, who served as a Series A Director from November 2005 until
March 2007, is a principal of Rural Development  Associates ("RDA"). The Company
entered  into a verbal  agreement  with RDA on  September  19,  2005,  which was
executed  on  October  11,  2005 (the  "2005 RDA  Agreement"),  under  which RDA
provided  project  development  services  to the  Company  for a monthly  fee of
$10,000,  plus actual  travel and other  approved  expenses.  Additionally,  the
Company agreed to pay RDA up to $1,600,000  upon completion of debt financing to
partially  finance a 110 million gallon per year plant.  One half of this amount
was to be made in cash with the other half to be made  through  the  issuance of
Series A Units  based  upon  the  price  the  Series  A Units  were  sold in the
Company's third round of equity  financing,  which was $6,000 per Unit. In July,
2006,  the  Company  and RDA  entered  into a second  agreement  (the  "2006 RDA
Agreement;"  together  with the 2005 RDA  Agreement,  the "RDA  Agreements")  to
explore the  feasibility  and  viability  of  expanding  the  Company's  ethanol
facility to a 220 million gallon  facility.  In September  2006, the Company and
RDA agreed to suspend the 2006 RDA Agreement and to continue  under the 2005 RDA
Agreement to develop the project on a month-to-month  basis,  which  arrangement
continued  until the 2005 RDA Agreement was  terminated in May,  2007. On May 3,
2006,  in lieu of the payment to RDA under the 2005 RDA  Agreement  and at RDA's
request,  the  Company  issued 45 Series A Units each to RDA's  principals  (Ron
Saak, Brad Petersburg and Steve Baker) directly in satisfaction of the Company's
equity issuance  obligations under the 2005 RDA Agreement.  As of the end of the
Company's fiscal year 2006, the Company had incurred  expenses of $132,545 under
the RDA Agreements. In fiscal year 2007, the Company paid RDA $1,669,947,  which
includes the issuance of 135 Series A Units for $810,000, as part of the success
fee payable under the 2005 RDA Agreement.

     The Company does not presently  have any policies  finalized and adopted by
the Board governing the review or approval of related party transactions.

Item 8. Legal Proceedings.

     There are no items to report.

Item 9. Market Price of and  Dividends  on the  Registrant's  Common  Equity and
        Related Stockholder Matters.

     As of December  31,  2007,  the Company had (i) 8,805 Series A Units issued
and  outstanding  held by 774  persons,  (ii)  3,334  Series B Units  issued and
outstanding held by Bunge, and (iii) 1,000 Series C Units issued and outstanding
held by ICM. The Company does not have any  established  trading  market for its
Units,  nor is one  contemplated.  While the Units issued and  outstanding as of
December 31, 2007,  excepting  those issued in the RDA  Offering,  could be sold
pursuant  to Rule  144  under  the  Securities  Act of  1933,  as  amended  (the
"Securities  Act"),  provided  all of the  conditions  imposed  by Rule  144 are
complied  with,  the sale of all Units is severely  restricted  by the Company's
Operating Agreement.  The Company has not agreed to register any Units under the
Securities  Act for  sale by  Members,  and no Units  are  being,  or have  been
publicly proposed to be, publicly offered by the Company.

     To date, the Company has made no distribution to its Members, and it cannot
be certain when it will be able to make distributions.  Further,  our ability to
make  distributions  will be restricted under the terms of the Credit Agreement,
as described  under Item 2. Financial  Information--Management's  Discussion and
Analysis of Financial Condition and Results of Operations--Liquidity and Capital
Resources.


                                       52

Item 10. Recent Sales of Unregistered Securities.

     In  connection  with the  services  to be  provided  us under  the 2005 RDA
Agreement,  we agreed to issue RDA up to 135 Series A Units upon the  closing of
our 2006  Series A Offering  (defined  below).  On May 3,  2006,  in lieu of the
payment to RDA under the 2005 RDA  Agreement and at RDA's  request,  the Company
issued 45 Series A Units each to RDA's principals (Ron Saak, Brad Petersburg and
Steve  Baker)  directly  in  satisfaction  of  the  Company's   equity  issuance
obligations under the 2005 RDA Agreement (the "RDA Offering").

     In addition,  we have issued  Units in three  separate  offerings,  none of
which were registered  under the Securities Act, as follows:  (i) in an offering
commencing  in  October  2005,  we issued  285  Units at $2,000  per Unit to our
founding  Members,  resulting in gross  proceeds of $570,000  (the "October 2005
Offering");  (ii) in an offering  commencing in November 2005, we (A) issued 360
Units at $3,000 per Unit,  resulting in gross  proceeds of  $1,080,000,  and (B)
issued, without cash consideration, 25 Units to Iowa Quality Producers Alliance,
LLC,  in  exchange  for its  efforts in our  organization  (the  "November  2005
Offering"); and (iii) in an offering commencing in February, 2006, we issued (A)
8,000  Series  A Units  at  $6,000  a  Unit,  resulting  in  gross  proceeds  of
$48,000,000  (the "2006 Series A Offering"),  (B) 1,000 Series C Units to ICM at
$6,000 a Unit,  resulting in gross proceeds of $6,000,000 (the "ICM  Offering"),
and (C) 3,334  Series B Units to Bunge at $6,000  per Unit,  resulting  in gross
proceeds of $20,004,000 (the "Bunge  Offering,"  together with the ICM Offering,
the 2006  Series A Offering,  the  November  2005  Offering,  the  October  2005
Offering  and the RDA  Offering,  the  "Offerings").  Additionally,  as  further
described above, on March 7, 2008, we entered into the Unit Issuance  Agreements
with ICM and Bunge  pursuant to which we agreed to reimburse ICM and / or Bunge,
as applicable,  with additional Units to the extent that ICM and / or Bunge make
a Bridge Loan Payment.  We did not pay any person any  commissions or discounts,
nor did we engage any underwriter or placement  agent, in connection with any of
the Offerings or the Unit Issuance Agreements.

     The Units  sold in the RDA  Offering,  the  October  205  Offering  and the
November 2005 Offering  (together,  the "4(2)  Offerings") were all issued under
the registration  exemption  provided for in Section 4(2) of the Securities Act.
With  respect to these  exemptions,  neither  we,  nor any person  acting on our
behalf,  offered  or sold  the  securities  by  means  of any  form  of  general
solicitation  or  advertising.  Prior to making any offer or sale in  connection
with the 4(2) Offerings,  we had reasonable grounds to believe and believed that
each prospective  investor (i) was capable of evaluating the merits and risks of
the investment, (ii) was able to bear the economic risk of the investment, (iii)
was provided with the  opportunity to ask questions of the Company's  management
respecting the Company's  business plans and finances,  (iv) received  access to
all material Company  contracts and agreements,  and (v) possessed the requisite
experience  in business and financial  matters to enable them to appreciate  the
risks  of  investing  in  the  Units.  Each  purchaser  in  the  4(2)  Offerings
represented  in  writing  that the  Units  purchased  were  being  acquired  for
investment for such purchaser's own account, and agreed that the Units would not
be sold,  without  registration  under the  Securities Act or exemption from the
Securities Act. Each purchaser in the 4(2) Offerings  agreed that a legend would
be placed on each certificate evidencing the Units stating the Units have not be
registered  under the  Securities  Act and setting forth  restrictions  on their
transferability.

     The Units sold in the 2006 Series A Offering,  the ICM Offering,  the Bunge
Offering  and the Unit  Issuance  Agreements  were made  under the  registration
exemption  provided  for in Section 4(2) of the  Securities  Act and Rule 506 of
Regulation D adopted under the  Securities  Act. With respect to the  exemption,
neither we, nor any person  acting on our  behalf,  offered or sold the Units by
means of any form of general  solicitation or  advertising.  Prior to making any
offer or sale,  we had  reasonable  grounds to believe  and  believed  that each
prospective  investor  was  capable  of  evaluating  the merits and risks of the
investment  and were  able to bear the  economic  risk of the  investment.  Each
purchaser  represented  in  writing  that the  Units  were  being  acquired  for
investment for such purchaser's own account, and agreed that the Units would not
be sold,  without  registration  under the  Securities Act or exemption from the
Securities  Act.  Each  purchaser  agreed  that a  legend  was  placed  on  each
certificate  evidencing the Units stating the Units have not be registered under
the Securities Act and setting forth restrictions on their transferability.


                                       53

Item 11. Description of Registrant's Securities to be Registered.

     The terms of the Company's Units are governed by the Company's  Articles of
Organization  filed  with the Iowa  Secretary  of State on March  28,  2005 (the
"Articles")  and our  Operating  Agreement.  Under  the  terms of our  Operating
Agreement,  Members  may receive  distributions  when and as  determined  by our
Board,  and  allocations  of our  profits  and  losses  are made based upon each
Member's  proportionate  ownership of our Units.  The Articles and the Operating
Agreement  provide that the Company is managed by managers (our Board),  and not
by the  Members.  Our Board is comprised  of seven  Directors,  and the Board is
empowered to do all things required to manage the Company's affairs,  subject to
any specific  voting rights  vested in the Members.  The Series B Member has the
right to elect the number of Directors out of those seven directorships equal to
the  proportion  of  Series  B  Units  held as  compared  to the  number  of all
outstanding  Units (this  provision  presently  entitles  the Series B Member to
elect two Directors),  and the Series B Member retains the right to always elect
at least one Director.  The Series C Member has the right to elect one Director.
If Series E Units are  issued,  the Series E Member has the right to elect up to
three of the seven Directors,  as further  described below. The Series A Members
have the right to elect the balance of the  Directors  not elected by the Series
B, Series C and Series E Members  (presently the Series A Members may elect four
Directors);  however,  the terms of the  Directorships  elected  by the Series A
Members are staggered  such that  beginning in 2008,  only one Series A Director
may be elected each year.  Staggering  the terms of the Series A  Directors,  in
addition  to the  rights of the  Series B Member,  the  Series C Member  and the
Series E Member (if Series E Units are issued) to elect  certain  Directorships,
means that Series A Members could only change the control of the Company through
electing all four Series A Directors, which would take four years.

     In addition to the special voting rights  afforded the holders of Series B,
Series C and  Series E Units  described  below,  holders  of Units  possess  the
following  voting  rights:  (i) Series A Members elect the Series A Directors by
majority  vote;  (ii) all Members must approve,  by a majority  vote,  any Board
decision to (A) cause or permit the  Company to engage in an  activity  which is
inconsistent with the Company's purposes,  (B) engage in an activity which would
act in contravention  of the Operating  Agreement or make it impossible to carry
on the  Company's  business,  or (C)  possess  Company  property  or assign  the
Company's  property for other than a Company  purpose;  and (iii) 66 2/3% of all
Members must approve: (W) the merger, consolidation,  sale or disposal of all or
substantially all of the Company's  property,  (X) the Company's  election to be
treated as a corporation  for tax purposes,  (Y) the  Company's  acquisition  of
securities  from a  Director  or  lending  of  money to a  Director,  or (Z) the
Company's dissolution. Each Unit entitles the holder one vote on any matter.

     The holder of the Series B Units must approve: (i) the creation or issuance
of  additional  Series B Units or an  additional  series of Units having  rights
senior  to those of the  Series B Member,  (ii) an  amendment  to the  Operating
Agreement  which  would  adversely  affect the Series B Member's  rights,  (iii)
changing the status of the Company from  manager-managed  to Member-managed  (or
vice  versa),  (iv) the  redemption  of the  Series B Units,  (v) the  voluntary
bankruptcy  of the  Company,  or (vi) a transfer  or issuance of Units (A) which
results in either the transferee  holding more than 17% of the outstanding Units
or (B) to a direct  competitor  of the Series B Member.  The  foregoing  special
voting  rights of the Series B Member  must  remain in effect for so long as the
original Series B Member, Bunge, remains a holder of Series B Units; except that
after  May  11,  2011,  Bunge  and  its  affiliates  may  sell  up to 15% of the
originally-purchased  Series B Units per year, but once Bunge and its affiliates
hold 25% or less of the originally-purchased Series B Units, such Units shall be
automatically  converted  to Series A Units.  Additionally,  any  Series B Units
transferred from Bunge and its affiliates shall be automatically  converted into
Series A Units upon transfer, except that the foregoing conversion provisions do
not apply to transfers of Series B Units among Bunge and its affiliates. Holders
of Series B Units have the preemptive  right to purchase their pro rata share of
any new securities proposed to be sold by the Company.

     The holder of the Series C Units must approve: (i) the creation or issuance
of additional  Series C Units or additional series of Units having rights senior
to those of the Series C Member,  (ii) an amendment to the  Operating  Agreement
which  would  adversely  affect  the  Series C  Member's  rights,  and (iii) the
redemption of the Series C Units.  Series C Units  transferred from the original
Series C Member,  ICM, and its affiliates shall be automatically  converted into
Series A Units upon transfer,  and if ICM and its affiliates  hold less than 833
Units, all Series C Units shall be automatically  converted into Series A Units,
except such  conversion  provision  does not apply to any  transfers of Series C
Units among ICM and its affiliates.


                                       54

     To the extent that the Company issues Series E Units pursuant to the Series
E Agreement,  the Company's  Operating  Agreement provides (i) the holder of the
Series E Units is entitled to elect one additional  director (to the extent that
such holder owns between 21% and 29% of the total Units issued and  outstanding)
two  additional  directors  (to the extent that such holder owns between 30% and
39% of the total Units issued and outstanding) or three additional directors (to
the  extent  that such  holder  owns 40% or more of the total  Units  issued and
outstanding);  and (ii) that the  Company may not,  without the  approval of the
holder of the Series E Units (a) issue additional Series E Units, (b) create any
additional Series of Units with rights which are superior to the Series E Units,
(c) modify the  Operating  Agreement to adversely  impact the rights of Series E
Unit  holders,  (d) change  the  Company's  status  from one which is managed by
managers,  or vice versa, (e) repurchase or redeem any Series E Units, (f) cause
the Company to take any action which would cause a bankruptcy,  or (g) approve a
transfer of Units allowing the transferee to hold more than 15% of the Company's
Units or to a transferee which is a direct competitor in the grain merchandising
business of a member holding Series E Units.

     The Company's Units may not be transferred  except with the approval of the
Board  and  upon  compliance  with  the  conditions  provided  in the  Operating
Agreement.

     Both the Operating  Agreement and the Unit Issuance Agreements provide that
the holder of Series C Units and the holder of Series E Units (if  issued)  have
the right to purchase their pro rata share of any Units issued.

Item 12. Indemnification of Directors and Officers.

     Under the Act, the articles of  organization  of an Iowa limited  liability
company ("LLC") may contain provisions  eliminating the personal liability of an
LLC's  members or  directors to the LLC or to its  members,  excepting  for such
person's: (i) receipt of financial benefit to which they are not entitled,  (ii)
intentional  infliction  of harm on the LLC or its  members,  (iii) an  unlawful
distribution,  or (iv) an intentional  violation of criminal law. In addition to
providing  the same  limitations  of  liability,  our Articles  provide that our
Directors  shall not be personally  liable for damages for breach of a manager's
fiduciary  duty,  except for  liability  for breach of the duty of loyalty,  bad
faith,  intentional  misconduct,  or a knowing  violation  of law.  Our Articles
further  provide that any Member or Director shall be  indemnified  and shall be
paid advances for their defense  expenses to the extent allowed by law, and that
the Board is empowered to provide  indemnification  to the  Company's  officers,
employees and agents.

     Our Operating Agreement provides that to the maximum extent permitted under
the Act and other  applicable  law,  the  Company  shall  indemnify  and pay all
judgments and claims against each Director or officer  relating to any liability
or damage  incurred by reason of any act performed or omitted to be performed by
such  Director or  officer,  in  connection  with the  business of the  Company,
including  reasonable  attorneys'  fees  incurred by such Director in connection
with  the  defense  of any  action  based on any  such  act or  omission,  which
attorneys' fees may be paid as incurred,  including all such  liabilities  under
federal and state securities laws as permitted by law.  Further,  to the maximum
extent  permitted  under the Act and other  applicable  law, in the event of any
action by a Member against any Director or officer, including a derivative suit,
the Company must indemnify and pay all costs, liabilities,  damages and expenses
of such Director or officer,  including  reasonable  attorneys' fees incurred in
the defense of such action.  The  Operating  Agreement  also  provides  that the
Company may  purchase  insurance  on behalf of any Director or officer in his or
her official  capacity  against any such  liability,  whether or not the Company
would  otherwise be required to indemnify such Director or officer  against such
liability.

Item 13. Financial Statements and Supplementary Data.

     See the Index to Financial Statements beginning on page F-1.

Item  14.  Change  in and  Disagreements  with  Accountants  on  Accounting  and
           Financial Disclosure.

     There are no items to report.


                                       55

Item 15. Financial Statements and Exhibits.

     (a) List separately all financial statements filed.

     See Index to Financial Statements beginning on Page F-1.

     (b) Exhibits

     See "Exhibit Index" below.


                                       56

                                   SIGNATURES

     In accordance  with Section 12 of the Exchange Act, the  Registrant  caused
this  report to be  signed on its  behalf  by the  undersigned,  thereunto  duly
authorized.

                                       SOUTHWEST IOWA RENEWABLE ENERGY, LLC

                                       By: /s/ Mark Drake, CEO
                                          ------------------------------------
                                          (Principal executive officer)

                                       Date: March 28, 2008


                                       57

                          INDEX TO FINANCIAL STATEMENTS

Report of Independent Registered Public Accounting Firm       F-2

Financial Statements
     Audited September 30, 2007 Financial Statements
     Balance Sheets                                           F-3
     Statements of Operations                                 F-5
     Statements of Members' Equity                            F-6
     Statements of Cash Flows                                 F-7
     Notes to Financial Statements                            F-9
     Unaudited December 31, 2007 Financial Statements
     Unaudited Balance Sheet                                 F-17
     Unaudited Statements of Operations                      F-19
     Unaudited Statements of Members' Equity                 F-20
     Unaudited Statements of Cash Flows                      F-21
     Notes to Unaudited Financial Statements                 F-23





                                      F-1

Report of Independent Registered Public Accounting Firm


To the Board of Directors
Southwest Iowa Renewable Energy, LLC (A Development Stage Company)

We have audited the balance sheets of Southwest Iowa  Renewable  Energy,  LLC (A
Development  Stage  Company) as of September 30, 2007 and 2006,  and the related
statements  of  operations,  members'  equity and cash flows for the years ended
September 30, 2007 and 2006,  the period from March 28, 2005 (date of inception)
to September  30, 2005 and the period from March 28, 2005 (date of inception) to
September 30, 2007.  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 Southwest  Iowa  Renewable
Energy, LLC (A Development Stage Company) as of September 30, 2007 and 2006, and
the results of its operations  and its cash flows for the years ended  September
30,  2007 and 2006,  the period  from  March 28,  2005  (date of  inception)  to
September  30, 2005 and the period from March 28,  2005 (date of  inception)  to
September  30, 2007,  in  conformity  with U.S.  generally  accepted  accounting
principles.

The  accompanying  financial  statements  have been  prepared  assuming that the
Company  will  continue  as a  going  concern.  As  discussed  in  Note 8 to the
financial  statements,   the  Company  currently  has  a  funding  shortfall  of
approximately  $31,000,000  due to  unforeseen  increases in plant  construction
costs.  This  funding  shortfall  has caused the senior  lender under the senior
secured debt facility  discussed in Note 3 to indicate that it has no obligation
to fund under the senior credit facility.  Until  additional  capital is secured
and the senior  lender  agrees to fund,  there is no  assurance  that the senior
lender will advance  construction funds which raises substantial doubt about the
Company's ability to continue as a going concern. Management's plan in regard to
this matter is described in Note 8. The financial  statements do not include any
adjustments that might result from the outcome of this uncertainty.

Omaha, Nebraska
January 28, 2008



                                      F-2

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Balance Sheets
September 30, 2007 and 2006

                                                        2007                       2006
----------------------------------------------------------------------------------------------

ASSETS (Note 3 and 4)

CURRENT ASSETS
     Cash and cash equivalents                   $      1,742,940          $          820,743
     Prepaid expenses and other                           124,952                      20,377
                                                 ---------------------------------------------

         Total current assets                           1,867,892                     841,120
                                                 ---------------------------------------------

PROPERTY AND EQUIPMENT
     Land                                               2,064,090                   3,513,715
     Construction in progress                          59,504,547                   2,115,731
     Office and other equipment                            79,090                       2,996
                                                 ---------------------------------------------
                                                       61,647,727                   5,632,442
     Accumulated depreciation                             (7,233)                       (162)
                                                 ---------------------------------------------
                                                       61,640,494                   5,632,280
                                                 ---------------------------------------------

OTHER ASSETS
     Cash held for plant construction                  15,638,542                         ---
     Deferred financing costs                           2,800,846                      25,386
     Deferred offering costs                                  ---                     139,889
                                                 ---------------------------------------------
                                                       18,439,388                     165,275
                                                 ---------------------------------------------

                                                 $     81,947,774          $        6,638,675
                                                 =============================================



See Notes to Financial Statements.


                                      F-3

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Balance Sheets
September 30, 2007 and 2006


                                                                               2007                  2006
----------------------------------------------------------------------------------------------------------------

LIABILITIES AND MEMBERS' EQUITY

CURRENT LIABILITIES
     Accounts and retainage payable                                  $           3,657,500   $          253,254
     Accrued expenses                                                               43,730              106,036
     Current maturities of long-term debt (Note 4)                               1,303,250                  ---
                                                                    -------------------------------------------

         Total current liabilities                                               5,004,480              359,290
                                                                    -------------------------------------------

LONG-TERM DEBT, less current maturities (Note 4)                                   168,333            1,283,250
                                                                    -------------------------------------------

COMMITMENTS (Notes 5, 6 and 7)

MEMBERS' EQUITY (Note 2)
     Members' capital                                                           76,474,111            5,778,000
     Earnings (deficit) accumulated during the development stage                   300,850            (781,865)
                                                                    -------------------------------------------
                                                                                76,774,961            4,996,135
                                                                    -------------------------------------------


                                                                     $          81,947,774   $        6,638,675
                                                                     ===========================================


See Notes to Financial Statements.


                                      F-4

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Statements of Operations

                                                                                              March 28,         March 28, 2005
                                                                                            2005 (Date of          (Date of
                                                        Year Ended         Year Ended       Inception) to       Inception) to
                                                       September 30,        September       September 30,       September 30,
                                                           2007             30, 2006             2005                2007
--------------------------------------------------------------------------------------------------------------------------------


Revenues                                           $              ---  $            ---  $             ---  $               ---
                                                   -----------------------------------------------------------------------------

General and administrative expenses (Note 6)                2,222,327           886,824             33,959            3,143,110
                                                   -----------------------------------------------------------------------------
     (Loss) before other income                           (2,222,327)         (886,824)           (33,959)          (3,143,110)

Other income and (expense):
     Grant                                                    114,235            55,246                ---              169,481
     Interest income                                        3,187,653            60,389                ---            3,248,042
     Miscellaneous income                                      37,238            18,958              4,325               60,521
     Loss on disposal of property                            (34,084)               ---                ---             (34,084)
                                                   -----------------------------------------------------------------------------
                                                            3,305,042           134,593              4,325            3,443,960

         Net income (loss)                         $        1,082,715  $      (752,231)  $        (29,634)  $           300,850
                                                   =============================================================================

Weighted average units outstanding                             12,568             1,155                  2                5,463
                                                   =============================================================================

Net income (loss) per unit - basic and diluted                 $86.15         ($651.28)       ($14,817.00)               $55.07
                                                   =============================================================================




See Notes to Financial Statements


                                      F-5

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Statements of Members' Equity
Years Ended September 30, 2007 and 2006 and Period from March 28, 2005
(Date of Inception) to September 30, 2005


                                                                                        Earnings
                                                                                        (Deficit)
                                                                                       Accumulated
                                                                                       During the
                                                                      Members'         Development
                                                                      Capital             Stage            Total
---------------------------------------------------------------------------------------------------------------------

Balance, March 28, 2005 (date of inception)                        $            ---   $          ---  $           ---
     Issuance of 285 Series A membership units (Note 2)                     570,000              ---          570,000
     Subscription receivable for 257 Series A membership units
     (Note 2)                                                             (514,000)              ---        (514,000)
     Net loss                                                                   ---         (29,634)         (29,634)
                                                                   ---------------------------------------------------
Balance, September 30, 2005                                                  56,000         (29,634)           29,366
     Receipt of membership units subscribed                                 514,000              ---          514,000
     Issuance of 1,047 Series A membership units (Note 2)                 5,202,000              ---        5,202,000
     Issuance of 1 Series B membership unit (Note 2)                          6,000              ---            6,000
     Net loss                                                                              (752,231)        (752,231)
                                                                   ---------------------------------------------------
Balance, September 30, 2006                                               5,778,000        (781,865)        4,996,135
     Issuance of 7,473 Series A membership units (Note 2)                44,838,000              ---       44,838,000
     Issuance of 3,333 Series B membership units (Note 2)                19,998,000              ---       19,998,000
     Issuance of 1,000 Series C membership units (Note 2)                 6,000,000              ---        6,000,000
     Offering costs                                                       (139,889)              ---        (139,889)
     Net income                                                                 ---        1,082,715        1,082,715
                                                                   ---------------------------------------------------
Balance, September 30, 2007                                        $     76,474,111   $      300,850  $    76,774,961
                                                                   ===================================================




See Notes to Financial Statements



                                      F-6

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Statements of Cash Flows

                                                                                              March 28, 2005      March 28, 2005
                                                                                                 (Date of            (Date of
                                                         Year Ended          Year Ended        Inception) to       Inception) to
                                                        September 30,         September        September 30,       September 30,
                                                            2007              30, 2006             2005                2007
----------------------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)                                  $          1,082,715  $      (752,231)  $         (29,634)  $          300,850
Adjustments  to reconcile  net income  (loss)
to net cash  provided by (used in)
operating activities:
     Depreciation                                                 7,071               162                 ---               7,233
     Loss on disposal of property                                34,084               ---                 ---              34,084
     Changes in working capital components
     (Increase) in prepaid expenses and other                 (104,575)          (20,377)                 ---           (124,952)
     Increase (decrease) in accounts payable                  (188,669)           245,242                 ---              56,573
     Increase (decrease) in accrued expenses                   (62,306)           106,036                 ---              43,730
                                                      ----------------------------------------------------------------------------
         Net cash provided by (used in)                         768,320         (421,168)            (29,634)             317,518
         operating activities
                                                      ----------------------------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES
     Purchase of property and equipment                    (53,871,995)       (5,624,430)                 ---        (59,496,425)
     Increase in cash for plant construction               (15,638,542)               ---                 ---        (15,638,542)
     Proceeds from sale of property and equipment             1,415,541               ---                 ---           1,415,541
                                                      ----------------------------------------------------------------------------
         Net cash (used in) investing activities)          (68,094,996)       (5,624,430)                 ---        (73,719,426)
                                                      ----------------------------------------------------------------------------


                                      F-7

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Statements of Cash Flows (continued)

                                                                                              March 28, 2005      March 28, 2005
                                                                                                 (Date of            (Date of
                                                         Year Ended          Year Ended        Inception) to       Inception) to
                                                        September 30,         September        September 30,       September 30,
                                                            2007              30, 2006             2005                2007
----------------------------------------------------------------------------------------------------------------------------------
CASH FLOWS FROM FINANCING ACTIVITIES
     Proceeds from issuance of membership units    $         69,876,000  $      5,722,000  $           56,000  $       75,654,000
     Payments for financing costs                           (1,815,460)          (25,386)                 ---         (1,840,846)
     Payments for offering costs                                    ---         (136,927)             (2,962)           (139,889)
     Proceeds from long-term borrowings                         200,000         1,283,250                 ---           1,483,250
     Payments of long-term borrowers                           (11,667)               ---                 ---            (11,667)
                                                   -------------------------------------------------------------------------------
         Net cash provided by financing                      68,248,873         6,842,937              53,038          75,144,848
         activities
                                                   -------------------------------------------------------------------------------

         Net increase in cash and cash
         equivalents                                            922,197           797,339              23,404           1,742,940

CASH AND CASH EQUIVALENTS
     Beginning                                                  820,743            23,404                 ---                 ---
                                                   -------------------------------------------------------------------------------
     Ending                                        $          1,742,940  $        820,743  $           23,404  $        1,742,940
                                                   ===============================================================================


SUPPLEMENTAL DISCLOSURES OF NONCASH OPERATING
AND FINANCING ACTIVITIES
     Construction in progress included in
     accounts payable                              $          3,600,927  $          8,012  $              ---  $        3,600,927
     Deferred offering costs in accounts payable                    ---           (4,300)               4,300                 ---
     Membership units issued for deferred
     financing costs                                            960,000               ---                 ---             960,000



See Notes to Financial Statements.



                                      F-8

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 1. Nature of Business and Significant Accounting Policies

Principal business activity: Southwest Iowa Renewable Energy, LLC (the Company),
located in Council  Bluffs,  Iowa, was formed in March 2005 to pool investors to
build a 110 million gallon annual production dry mill corn-based  ethanol plant.
As of  September  30,  2007,  the Company is in the  development  stage with its
efforts being principally devoted to organizational,  equity-raising  activities
and construction of the ethanol plant.

A summary of significant accounting policies follows:

   Use of estimates:  The preparation of financial statements in conformity with
   accounting  principles  generally  accepted  in the United  States of America
   requires  management  to make  estimates  and  assumptions  that  affect  the
   reported  amounts of assets and  liabilities  and  disclosure  of  contingent
   assets  and  liabilities  at the  date of the  financial  statements  and the
   reported amounts of revenues and expenses during the reporting period. Actual
   results could differ from those estimates.

   Concentrations  of credit risk: The Company's cash balances are maintained in
   bank deposit accounts which at times may exceed federally insured limits.

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

   Cash  held  for  plant  construction:  The  cash  that  will be used  for the
   construction of the plant has been  classified as long-term  according to its
   estimated use.

   Deferred  financing  costs:  Deferred  financing  costs  associated  with the
   construction and revolving loans discussed in Note 3 are recorded at cost and
   include expenditures directly related to securing debt financing. These costs
   will be amortized using the effective interest method over the 5-year term of
   the  agreement.  As of September  30, 2007,  the Company has not received any
   loan proceeds under these agreements.

   Deferred offering costs: The Company classifies all costs directly related to
   raising  capital as deferred  offering costs until the capital is raised,  at
   which  point the costs were  reclassified  as an offset to equity as issuance
   costs. A total of $139,889 of offering costs were  reclassified  as an offset
   to equity for the year ended September 30, 2007.

   Property  and   equipment:   Property  and   equipment  is  stated  at  cost.
   Construction in progress is comprised of costs related to the construction of
   the ethanol plant,  depreciation of such amounts will commence when the plant
   begins  operations over estimated useful lives ranging from 5 to 40 years. As
   of September 30, 2007 there were no capitalized interest costs.  Depreciation
   is  computed  using the  straight-line  method over the  following  estimated
   useful lives:

                                                               Years
                                                         ------------------

       Office and other equipment                              5 - 7

   Maintenance  and repairs are expenses as  incurred;  major  improvements  and
   betterments are capitalized.



                                      F-9

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 1. Nature of Business and Significant Accounting Policies (Continued)

   Income  taxes:  The Company has  elected to be treated as a  partnership  for
   federal and state  income tax purposes  and  generally  does not incur income
   taxes.  Instead, the Company's earnings and losses are included in the income
   tax returns of the members.  Therefore, no provision or liability for federal
   or state income taxes has been included in these financial statements.

   Net income (loss) per unit: Earnings per unit have been computed on the basis
   of the  weighted  average  number of units  outstanding  during  each  period
   presented.  Units issuable  relating to subscribed  units as of September 30,
   2005 have not been included in the computation  because their inclusion would
   have  reduced the loss per unit  applicable  to the net income for the period
   March 28, 2005 (date of inception) to September 30, 2005.

   Grant  income:  The  Company  recognizes  grant  income as other  income  for
   reimbursement of expenses  incurred upon complying with the conditions of the
   grant.

   Organizational   costs  and  startup   costs:   The  Company   expenses   all
   organizational and startup costs as incurred.

   Fair value of financial  instruments:  The carrying  amounts of cash and cash
   equivalents,  accounts payable and accrued  expenses  approximate fair value.
   The fair value of long-term debt is estimated  based on anticipated  interest
   rates which  management  believes would currently be available to the Company
   for similar  issues of debt,  taking into account the current credit risk and
   other market factors.

Note 2. Members' Equity

The Company was formed on March 28, 2005 to have a perpetual  life with no limit
on the number of authorized  units. The Company was initially  capitalized by 19
management  committee  members  who  contributed  an  aggregate  of  $570,000 in
exchange for 285 Series A membership units. In December 2005, the Company issued
an additional 360 Series A membership units in exchange for $1,080,000. In March
2006,  the Company  completed a private  placement  offering with one membership
unit at $6,000 being at risk and the remaining  investment  held in escrow until
closing of the  offering.  The  Company  approved  and issued 687 Series A and 1
Series B at risk membership  units at $6,000 per unit for a total of $4,128,000.
The  offering  was closed in November  2006 with the  issuance of 7,313 Series A
membership units,  3,333 Series B membership units and 1,000 Series C membership
units for a total of $69,876,000.

In addition,  in November 2005 the Board of Directors approved the issuance upon
financial close of 25 Series A membership units to the development  group,  Iowa
Quality  Producers  Alliance,  LLC,  for  efforts  by the  organization  for the
development  and  advancement  of the  ethanol  project.  Pursuant to terms of a
management  agreement,  the  Board  of  Directors  approved  the  issuance  upon
financial  close,  135  Series A  membership  units  were  issued  to the  Rural
Development  Associates (RDA).  These units were issued as part of a contractual
success fee arrangement, that upon actual closing of all financing documents RDA
was to receive a success fee for their efforts  relating to securing  financing.
The success fee was to be paid 1/2 cash and 1/2 membership units.



                                      F-10

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 2. Members' Equity (Continued)

At September 30, 2007 and 2006 outstanding member units were:

                                      September 30,          September 30,
                                          2007                2006
                                  --------------------- ------------------
A Units                                  8,805                1,332
B Units                                  3,334                  1
C Units                                  1,000                 --

The  Series A, B and C unit  holders  all vote on  certain  matters  with  equal
rights.  The Series C unit holders have the right to elect one Board of Director
member.  The Series B unit  holders have the right to elect that number of Board
of Director members which bears the same proportion to the total number of Board
of  Directors  in relation to Series B  outstanding  units to total  outstanding
units.  Series A unit  holders have the right to elect the  remaining  number of
Board of Director members, not elected by the Series C and B unit holders.

Series B unit holders have the right to purchase  any new  securities  issued by
the  Company  on  a  pro-rata  basis  in  relation  to  its  existing  ownership
relationship.  Series B unit  holders may sell up to 15 percent of its  original
units  per  annum  beginning  May 11,  2011  without  terminating  the above new
securities pro-rata right.

Income and losses are allocated to all members based on their pro rata ownership
interest.  Units may be issued or  transferred  only to persons  eligible  to be
members  of the  Company  and  only in  compliance  with the  provisions  of the
operating agreement.

Note 3. Construction and Revolving Loan/Credit Agreements

In May 2007,  the  Company  entered  into a loan  commitment  with a lender  for
$126,000,000  senior secured debt,  consisting of an  $111,000,000  construction
loan and a $15,000,000 revolving line of credit. Letters of credit pertaining to
the construction may be drawn on the construction  loan not to exceed $3,000,000
in  aggregate.  Borrowings  under the  construction  credit  facility  agreement
include a variable  interest  rate  based on LIBOR  plus 3.15% for each  advance
under the agreement. Upon completion of construction,  the construction loan may
be  segmented  into  two  credit  facilities,  an  amortized  term  facility  of
$101,000,000 and a revolving term facility of $10,000,000.  Upon conversion, the
Company has the option of converting  50% of the term note into fixed rate loans
at the  lender's  bonds rate plus 2.75%.  The portion of the term loan not fixed
and the term revolving  line of credit will accrue  interest equal to LIBOR plus
2.95%.  LIBOR of September 30, 2007 was 5.54%. The credit facility and revolving
credit agreement  require the maintenance of certain  financial and nonfinancial
covenants.  Borrowings under this agreement are  collateralized by substantially
all of the Company's  assets.  The  construction/revolving  term credit facility
require  monthly  principal   payments  starting  the  seventh  month  following
conversion of the construction loan to a term loan. The conversion will occur 60
days after completion of the  construction.  The loan will be amortized over 114
months and will mature five years after the conversion  date. The revolving term
credit agreement expires in five years after the conversion of the loan at which
time the principal  outstanding is due. Borrowings are subject to borrowing base
restrictions  as defined in the agreement.  The agreements  also include certain
prepayment   penalties.   There   was   no   balance   outstanding   under   the
construction/revolving term credit facility and revolving credit agreement as of
September 30, 2007.


                                      F-11

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 3. Construction and Revolving Loan/Credit Agreements (Continued)

In November 13, 2007, the Company  received  notification  from Agent requesting
that it immediately  provide a sworn  construction  statement under the terms of
the Credit Agreement in response to the updated project budget dated October 29,
2007,  which reflected a budgeted  shortfall of  $31,000,000.  The Agent further
requested the deposit of $34,121,313  with the disbursing agent under the Credit
Agreement and related  documents  within ten days.  Thereafter,  the Company and
Agent commenced  discussions  regarding the potential  construction  funding gap
projected in the October 29, 2007  construction  budget. On January 3, 2008, the
Company received  notification  from Agent requesting a firm proposal to address
the equity  shortfall  along with other  materials.  As of January 28, 2008, the
Company was  negotiating  with Agent (on behalf of the  Lenders) and a potential
bridge lender to resolve the funding  shortfall  and commence  funding under the
Credit Agreement through the following proposals:

     o The  Company  would  obtain a bridge  loan from the Bridge  Lender in the
     amount of $31,000,000. Under the Bridge Loan, the Company would be required
     to pay interest,  and the  principal  would be due in November,  2008.  The
     proceeds of the bridge loan would be  deposited  into the Credit  Agreement
     disbursing account and applied as required thereunder. The bridge loan debt
     would be secured by two letters of credit, described below.

     o Bunge  would  cause its bank to issue a letter  of  credit in the  amount
     equal to 76% of the $31,000,000  borrowed under the Bridge Loan in favor of
     Lenders,  and ICM would  cause its  lender to  similarly  issue a letter of
     credit in the amount  equal to 24% of the  $31,000,000  borrowed  under the
     bridge loan in favor of Lenders (together,  the LCs). Both LCs would expire
     in  December,  2008,  and  Lenders  would only draw  against the LCs to the
     extent that the Company has not repaid the bridge loan in full by November,
     2008. In the event Lenders draw against the LCs, the amounts drawn would be
     in  proportion to Bunge's and ICM's  respective  ownership of the Company's
     Units which are not Series A--76% and 24%, respectively.  Similarly, as the
     Company  repays the principal of the bridge loan,  the LCs' stated  amounts
     would correspondingly be reduced in the same proportion.

     o The Company  would  enter into a proposed  Reimbursement  Agreement  with
     Bunge  and ICM (the  Reimbursement  Agreement)  in  connection  with  their
     respective  issuances of the LCs. Under the  Reimbursement  Agreement,  the
     Company  would agree to pay Bunge and ICM each a fee for the  issuances  of
     their  respective  LCs.  To the  extent  that  the  LCs are  drawn  upon as
     discussed  above,  the Company would  immediately  reimburse Bunge and ICM.
     Such reimbursement  would consist of the issuance of Units to Bunge and ICM
     at the price of $3,000 per Unit, though the terms of such Units,  including
     their price, remain subject to further negotiations. The Company would also
     agree to use its best efforts to either obtain additional debt financing or
     raise  additional  equity to eliminate the need for the bridge loan and the
     LCs.

     o The terms of the  Credit  Agreement  would be  modified  to  reflect  the
       foregoing.


                                      F-12

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 4. Long-Term Debt

Long-term debt consists of the following as of September 30, 2007 and 2006:


                                                                                         2007                 2006
                                                                                   -----------------------------------
Note payable to Pottawattamie County, Iowa, non-interest bearing, due 180       $      1,283,250      $     1,283,250
days after ethanol production begins or January 31, 2008, whichever comes
first, secured by land

$200,000  Note  payable  to  Iowa   Department   Economic   Development   (IDED)
non-interest bearing monthly payments of $1,667 due through maturity date
of March 2012 on non-forgivable portion (A)                                     $        188,333      $     1,283,250
                                                                                       1,471,583            1,283,250
Less current maturities
                                                                                     (1,303,250)                  ---
                                                                              $          168,333      $     1,283,250



Maturities  of  long-term  debt as of September  30, 2007 are as follows:  Years
ending September 30:
         2008                                                                 $        1,303,250
         2009                                                                             20,000
         2010                                                                             20,000
         2011                                                                             20,000
         2012                                                                            108,333
                                                                              $        1,471,583

(A)  The agreement is comprised of two  components.  A $100,000  loan  agreement
     which  is non  interest-bearing  and due in  monthly  payments  of  $1,667,
     beginning  April 2007,  and a final payment of $1,667 due March 2012; and a
     $100,000  forgivable  loan  agreement.  Both notes under this agreement are
     collateralized by substantially all of the Company's assets and subordinate
     to the above $126,000,000  financial  institution debt and construction and
     revolving loan/credit  agreements discussed in Note 3. The $100,000 loan is
     forgivable  upon IDED  approval of creation of  qualifying  jobs as per the
     Master  Contract.  If the  Company  does not meet the  requirements  of the
     contract, the note is due on an agreed upon payment schedule.

Note 5. Lease Commitments

The Company entered an operating lease agreement with a related party and member
for the lease of 320 ethanol tank cars and 300 distillers' grain cars. The lease
begins two months prior to start-up of the plant operation, continues for a term
of ten years, and terminates upon the termination of the final car lease.

The  Company  leases  office  space under a  long-term  operating  lease from an
unrelated  third party.  The original term of the lease is 12 months,  beginning
June 30, 2007.


                                      F-13

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 5. Lease Commitments (Continued)

The Company leases a vehicle and equipment under long-term operating leases from
unrelated  third  parties.  The original  term of the leases is 12 to 36 months,
beginning February 2007 and through various dates ending September 2008.

Approximate  minimum lease  payments under these  operating  leases for the next
five years are as follows:

     Years ending September 30:
         2008                               $          1,400,000
         2009                                          5,400,000
         2010                                          5,400,000
         2011                                          5,400,000
         2012                                          5,400,000

Note 6. Related-Party Transactions

In September  2005, the Company  entered into an agreement that expired May 2007
(and was not  renewed)  with a  management  company  that  included a member and
director on the board of  directors,  for  project  development  services  for a
monthly  fee of  $10,000  per  month,  plus  actual  travel  and other  approved
expenses.  The  agreement  also  included  a fee of up to  $1,600,000  for a 100
million  gallon per year plant that was due upon the  financial  closing for the
project. Expenses under this agreement totaled $1,669,947, $132,545, $10,000 and
$1,812,492 for the year ended September 30, 2007, year ended September 30, 2006,
period from March 28, 2005 (date of inception) to September 30, 2005, and period
from March 28, 2005 (date of  inception)  to  September  30,  2007,respectively.
Financial close of the project occurred during the year ended September 30, 2007
and 135 Series A membership  units were issued directly to RDA's  principals for
$810,000 of the  $1,600,000  fee.  The total fee of  $1,600,000  included in the
above expenses of $1,669,947 has been capitalized as deferred offering costs and
will be amortized over the term of the senior secured debt.

In September  2006,  the Company  entered into a  design-build  agreement with a
related  party,  a member  of the  Company,  for a  lump-sum  contract  price of
$118,000,000.  As part of the contract,  the Company was required to make a down
payment of 10% of the original  contract price which  $2,000,000 was paid at the
delivery of the letter of intent, an additional  $2,000,000 was paid in November
2006 when the Company broke escrow and the  remaining  $7,800,000 of the 10% was
paid in January 2007. Monthly  applications will be submitted for work performed
in the previous  period subject to retainage.  As of September 2007, the Company
has incurred  approximately  $33,051,000 of  construction in progress under this
contract.


                                      F-14

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 6. Related Party Transactions (Continued)

The Company  entered into an agreement in October 2006 with a related  party,  a
member of the Company,  to purchase all of the  distiller's  grains with soluble
(DGS) produced by the plant.  The Company agrees to pay a purchase price subject
to the sales  price,  transportation  costs,  rail lease charge and a fixed rate
marketing fee for the DGS produced.  The  agreement  commences  when the Company
begins  producing  DGS and  continues  for ten years when it will  automatically
renew for  successive  three-year  terms unless a one hundred eighty day written
notice is given of either party's election not to renew before the expiration of
the initial term or the then current  renewal term. In addition,  the Company is
required to deliver written estimates of its anticipated  monthly DGS production
annually and monthly.  The Company is required to pay a minimum annual marketing
fee of $150,000. Beginning on the third anniversary of the effective date of the
agreement and  thereafter,  the annual minimum amount and the purchase price may
be adjusted  based on terms within the contract.  Either party may terminate the
agreement based on specific guidelines in the agreement.

In October 2006,  the Company  entered into an agreement with a related party, a
member of the Company,  to procure all grain required for the ethanol plant. The
Company agreed to pay an agency fee mutually  agreed to by both parties for corn
delivered by truck or rail, with a minimum annual fee of $225,000. The agreement
commences  when the Company  first needs corn for  production.  It is  currently
anticipated  that this will occur September 2008 and will continue for ten years
when it will  automatically  renew for successive  three-year terms unless a one
hundred  eighty day written  notice is given of either  party's  election not to
renew before the  expiration  of the initial  term or the then  current  renewal
term.  Either party may terminate the agreement based on specific  guidelines in
the agreement.

Note 7. Commitments

The total cost of the project,  including the  construction of the ethanol plant
and start-up expenses, is expected to be approximately $234,185,000. The Company
is funding the development of the ethanol plant by using the total equity raised
of $75,654,000 and financing of approximately  $126,000,000,  though the Company
is not yet  able  to  borrow  under  such  financing  (see  Notes 3 and 8).  The
additional project costs will be funded by other financing and equity sources.

In September  2006,  the Company  entered into an agreement  with a design-build
contractor  for  construction  of the  ethanol  plant  for a lump  sum  price of
$118,000,000 (see Note 6). The agreement states that $11,800,000 will be paid in
cash as a down payment to be applied toward  applications for payments.  Monthly
applications will be submitted for work performed in the previous period subject
to retainage.  As of September 30, 2007,  the Company  incurred  $33,051,062  of
construction  in progress.  The Company has included in construction in progress
payments  made  totaling  $40,058,658  to the  contractor  for  the  year  ended
September  30,  2007;  therefore  approximately  $78,000,000  future  commitment
remains as of September  30, 2007 which is expected to be paid in 2008.  Of this
total,  approximately $1,653,000 is included in accounts payable as of September
30, 2007.

The Company has also entered into various other  contracts  during 2006 and 2007
for the  construction  of the ethanol  plant,  office  building,  rail track and
acquisition  of  equipment  totaling  approximately  $21,245,000  with a  future
commitment  of  approximately  $9,600,000  as of September  30,  2007,  which is
expected to be paid in 2008. Of this total, approximately $1,874,000 is included
in accounts payable as of September 30, 2007.


                                      F-15

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 7. Commitments (Continued)

In November 2006, the Company entered into an agreement with an unrelated entity
for  marketing,  selling and  distributing  all of the  ethanol  produced by the
Company.  The Company will pay a fee mutually agreed to by both parties for each
gallon of ethanol sold. This agreement shall be effective  through  December 31,
2010 and will renew annually until terminated by 90 days' written notice.  As of
September 30, 2007, the ethanol plant is not  operational and no amounts are due
under this agreement.

In November  2006,  the Company  entered into an agreement with a related entity
for marketing,  selling and distributing all of the distillers dried grains with
solubles which are  by-products of the ethanol plant.  Under the agreement,  the
Company will pay a minimum  annual  marketing fee of $250,000.  The term of this
agreement  shall be for ten years  commencing as of  completion  and start-up of
production  of the plant.  As of September  30, 2007,  the ethanol  plant is not
operational and no amounts are due under this agreement.

The Company has entered  into a steam  contract  with an  unrelated  party dated
January 22, 2007, under which the vendor agreed to provide the steam required by
the  Company,  up to 475,000  pounds per hour.  The Company  agreed to pay a net
energy  rate for all steam  service  provided  under the  steam  contract  and a
monthly  demand charge for  condensate  not returned  (steam  delivered less the
condensation  returned).  The net energy  rate is set for first three years then
adjusted each year beginning on the third  anniversary  date. The steam contract
will  remain in effect  for ten years from the  earlier of the date the  Company
commences a continuous grind of corn for ethanol production, or January 1, 2009.

Note 8. Going Concern

The  accompanying  financial  statements  have been  prepared  assuming that the
Company will continue as a going concern.  As of September 30, 2007, the Company
currently has a funding shortfall of approximately $31,000,000 due to unforeseen
increases  in plant  construction  costs.  This raises  doubt about  whether the
Company  will  continue  as a going  concern.  Until the  funding  shortfall  is
resolved to the satisfaction of the lenders, the lenders have indicated they are
not obligated to make construction advances needed to construct the plant.

The Company is presently negotiating with its lenders, potential bridge lenders,
and its significant  equity holders to resolve the funding shortfall and achieve
the ability to utilize the debt financing it has in place. Such negotiations may
result in additional debt incurred by the Company and the issuance of additional
equity.

The  Company  has been in  communication  with its  lender as to the steps it is
currently taking to resolve the funding shortfall, but there can be no assurance
that the lender will make advances  given the funding  shortfall.  The Company's
ability to continue as a going concern is dependent on the Company's  ability to
fund the  shortfall  and the  lender's  willingness  to accept  the terms of the
bridge financing.

Management  anticipates that if bridge financing cannot be obtained,  or it will
not satisfy the bank  requirements,  the  Company may raise  additional  capital
through the sale of additional membership units. However,  there is no assurance
that the Company would be able to raise the desired capital.



                                      F-16

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Unaudited Balance Sheet
December 31, 2007

                                                                                                     
-----------------------------------------------------------------------------------------------------------------

ASSETS

CURRENT ASSETS
     Cash and cash equivalents                                                               $         1,242,884
     Prepaid expenses and other                                                                           42,981
                                                                                             --------------------

         Total current assets                                                                          1,285,865
                                                                                             --------------------

PROPERTY AND EQUIPMENT
     Land                                                                                              2,064,090
     Construction in progress                                                                         94,235,706
     Office and other equipment                                                                           86,192
                                                                                             --------------------
                                                                                                      96,385,988
     Accumulated depreciation                                                                           (10,661)
                                                                                             --------------------
                                                                                                      96,375,327
                                                                                             --------------------

OTHER ASSETS
     Cash held for plant construction                                                                  1,871,461
     Deferred financing costs                                                                          2,804,034
                                                                                             --------------------
                                                                                                       4,675,495
                                                                                             --------------------

                                                                                             $       102,336,687
                                                                                             ====================




See Notes to Unaudited Financial Statements.

                                      F-17

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Unaudited Balance Sheet (continued)
December 31, 2007



-------------------------------------------------------------------------------------------------------------------

LIABILITIES AND MEMBERS' EQUITY

CURRENT LIABILITIES
     Accounts and retainage payable                                                               $     24,484,763
     Accrued expenses                                                                                      115,560
     Current maturities of long-term debt                                                                1,298,250
                                                                                                  -----------------

         Total current liabilities                                                                      25,898,573
                                                                                                  -----------------

LONG-TERM DEBT, less current maturities                                                                    168,333
                                                                                                  -----------------

MEMBERS' EQUITY
     Members' capital                                                                                   76,474,111
     (Deficit) accumulated during the development stage                                                  (204,330)
                                                                                                  -----------------
                                                                                                        76,269,781
                                                                                                  -----------------


                                                                                                  $    102,336,687
                                                                                                  =================


See Notes to Unaudited Financial Statements.



                                      F-18

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Unaudited Statements of Operations

                                                                                                       March 28, 2005
                                                                                                          (Date of
                                                            Three Months         Three Months          Inception) to
                                                           Ended December        Ended December         December 31,
                                                              31, 2007              31, 2006                2007
-----------------------------------------------------------------------------------------------------------------------


Revenues                                                $              ---    $              ---    $              ---

General and administrative expenses                                598,246               189,279             3,741,356
                                                        ---------------------------------------------------------------
     (Loss) before other income                                  (598,246)             (189,279)           (3,741,356)
                                                        ---------------------------------------------------------------

Other income and (expense):
     Grant                                                             ---                   ---               169,480
     Interest income                                                88,031             1,182,928             3,336,073
     Miscellaneous income                                            5,035                25,965                65,557
     Loss on disposal of property and equipment                        ---                   ---              (34,084)
                                                        ---------------------------------------------------------------
                                                                    93,066             1,208,893             3,537,026

         Net income (loss)                              $        (505,180)    $        1,019,614    $        (204,330)
                                                        ===============================================================

Weighted average units outstanding                                  13,139                 8,823                 5,750
                                                        ===============================================================

Net income (loss) per unit - basic and diluted                    ($38.45)               $115,56              ($35,54)
                                                        ===============================================================




See Notes to Unaudited Financial Statements




                                      F-19

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Unaudited Statements of Members' Equity

                                                                                        Earnings
                                                                                        (Deficit)
                                                                                       Accumulated
                                                                                       During the
                                                                     Members'          Development
                                                                     Capital              Stage           Total
----------------------------------------------------------------------------------------------------------------------

Balance, March 28, 2005 (date of inception)                        $            ---   $          ---  $           ---
     Issuance of 285 Series A membership units (Note 2)                     570,000              ---          570,000
     Subscription receivable for 257 Series A membership units
     (Note 2)                                                             (514,000)              ---        (514,000)
     Net loss                                                                   ---         (29,634)         (29,634)
                                                                   ---------------------------------------------------
Balance, September 30, 2005                                                  56,000         (29,634)           29,366
     Receipt of membership units subscribed                                 514,000              ---          514,000
     Issuance of 1,047 Series A membership units (Note 2)                 5,202,000              ---        5,202,000
     Issuance of 1 Series B membership unit (Note 2)                          6,000              ---            6,000
     Net loss                                                                              (752,231)        (752,231)
                                                                   ---------------------------------------------------
Balance, September 30, 2006                                               5,778,000        (781,865)        4,996,135
     Issuance of 7,473 Series A membership units (Note 2)                44,838,000              ---       44,838,000
     Issuance of 3,333 Series B membership units (Note 2)                19,998,000              ---       19,998,000
     Issuance of 1,000 Series C membership units (Note 2)                 6,000,000              ---        6,000,000
     Offering costs                                                       (139,889)              ---        (139,889)
     Net income                                                                 ---        1,082,715        1,082,715
                                                                   ---------------------------------------------------
Balance, September 30, 2007                                              76,474,111          300,850       76,774,961
     Net Income                                                                 ---        (505,180)        (505,180)
                                                                   ---------------------------------------------------
Balance, December 31, 2007                                         $     76,474,111   $    (204,330)  $    76,269,781
                                                                   ===================================================




See Notes to Unaudited Financial Statements


                                      F-20

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Unaudited Statements of Cash Flows

                                                                                                       March 28, 2005
                                                                                     Three Months         (Date of
                                                                 Three Months           Ended           Inception) to
                                                                Ended December       December 31,       December 31,
                                                                   31, 2007              2006               2007
-----------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM OPERATING ACTIVITIES
Net income (loss)                                            $        (505,180)  $       1,019,614  $        (204,330)
Adjustments to reconcile net income (loss) to net cash
provided by (used in) operating activities:
   Depreciation                                                           3,428                606              10,661
     Loss on disposal of property                                           ---                ---              34,084
   Changes in working capital components
     (Increase) in prepaid expenses and other                            81,971            (1,408)            (42,981)
     Increase (decrease) in accounts payable                             18,103          (253,254)              74,676
     Increase (decrease) in accrued expenses                             71,830          (105,520)             115,560
                                                                -------------------------------------------------------
         Net cash provided by (used in) operating                     (329,848)            660,038            (12,330)
         activities
                                                                -------------------------------------------------------

CASH FLOWS FROM INVESTING ACTIVITIES
     Purchase of property and equipment                            (13,929,101)        (2,625,968)        (73,427,795)
     Decrease in cash for plant construction                         13,767,081                ---           1,871,461
     Proceeds from sale of property and equipment                           ---                ---           1,417,810
                                                                -------------------------------------------------------
         Net cash (used in) investing activities                      (162,020)        (2,625,968)        (73,881,446)
                                                                -------------------------------------------------------



See Notes to Unaudited Financial Statements.


                                      F-21

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Unaudited Statements of Cash Flows (continued)

                                                                         Three           Three           March 28, 2005
                                                                         Months          Months             (Date of
                                                                         Ended            Ended          Inception) to
                                                                        December        December            December
                                                                        31, 2007        31, 2006            31, 2007
-------------------------------------------------------------------------------------------------------------------------

CASH FLOWS FROM FINANCING ACTIVITIES
     Proceeds from issuance of membership units                    $           ---  $     69,876,000  $       75,654,000
     (Payments) Refund of financing costs                                  (3,188)               386         (1,844,034)
     Payments for offering costs                                               ---               ---           (139,889)
     Proceeds from long-term borrowings                                        ---           200,000           1,483,250
     Payments of long-term borrowers                                       (5,000)               ---            (16,667)
                                                                   ------------------------------------------------------
         Net cash provided by financing activities                         (8,188)        70,076,386          75,136,660

         Net increase (decrease) in cash and cash equivalents            (500,056)        68,110,456           1,242,884

CASH AND CASH EQUIVALENTS
     Beginning                                                           1,742,940           820,743                 ---
     Ending                                                        $     1,242,884  $     68,931,199  $        1,242,884
                                                                   ======================================================

SUPPLEMENTAL DISCLOSURES OF NONCASH OPERATING AND FINANCING
ACTIVITIES
     Construction in progress included in accounts payable         $    24,410,087  $            ---  $       24,410,087
     Membership units issued for deferred financing costs                      ---               ---             960,000
       Offering costs netted with proceeds from membership units
     issued                                                                    ---           139,889                 ---



See Notes to Unaudited Financial Statements.



                                      F-22

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Unaudited Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 1. Nature of Business and Significant Accounting Policies

Principal business activity: Southwest Iowa Renewable Energy, LLC (the Company),
located in Council  Bluffs,  Iowa, was formed in March 2005 to pool investors to
build a 110 million gallon annual production dry mill corn-based  ethanol plant.
As of  December  31,  2007,  the  Company is in the  development  stage with its
efforts being principally devoted to organizational,  equity-raising  activities
and construction of the ethanol plant.

The accompanying  financial statements as of December 31, 2007 and for the three
months ended December 31, 2007 and 2006 and the period from inception  March 28,
2005 to December 31, 2007 are unaudited and reflect all adjustments  (consisting
only of normal recurring  adjustments)  which are, in the opinion of management,
necessary  for a fair  presentation  of the  financial  position  and  operating
results for the interim periods.  These unaudited financial statements and notes
should be read in conjunction  with the audited  financial  statements and notes
thereto, for the period from inception March 28, 2005 to September 30, 2007. The
results of operations  for the three months ended December 31, 2007 and 2006 and
the  period  from  inception  March  28,  2005  to  December  31,  2007  are not
necessarily indicative of the results for the entire year.

A summary of significant accounting policies follows:

   Use of estimates:  The preparation of financial statements in conformity with
   accounting  principles  generally  accepted  in the United  States of America
   requires  management  to make  estimates  and  assumptions  that  affect  the
   reported  amounts of assets and  liabilities  and  disclosure  of  contingent
   assets  and  liabilities  at the  date of the  financial  statements  and the
   reported amounts of revenues and expenses during the reporting period. Actual
   results could differ from those estimates.

   Concentrations  of credit risk: The Company's cash balances are maintained in
   bank deposit accounts which at times may exceed federally insured limits.

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

   Cash  held  for  plant  construction:  The  cash  that  will be used  for the
   construction of the plant has been  classified as long-term  according to its
   estimated use.

   Deferred  financing  costs:  Deferred  financing  costs  associated  with the
   construction  and  revolving  loans  and are  recorded  at cost  and  include
   expenditures directly related to securing debt financing. These costs will be
   amortized  using the  effective  interest  method over the 5-year term of the
   agreement.  As of December  31,  2007,  the Company has not received any loan
   proceeds under these agreements.

   Deferred offering costs: The Company classifies all costs directly related to
   raising  capital as deferred  offering costs until the capital is raised,  at
   which  point the costs were  reclassified  as an offset to equity as issuance
   costs.

   Property  and   equipment:   Property  and   equipment  is  stated  at  cost.
   Construction in progress is comprised of costs related to the construction of
   the ethanol plant,  depreciation of such amounts will commence when the plant
   begins  operations over estimated useful lives ranging from 5 to 40 years. As
   of December 31, 2007 there were no capitalized  interest costs.  Depreciation
   is  computed  using the  straight-line  method over the  following  estimated
   useful lives:
                                                                Years
                                                          ------------------
       Office and other equipment                               5 - 7


                                      F-23

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Unaudited Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 1. Nature of Business and Significant Accounting Policies (Continued)

   Maintenance  and repairs are expenses as  incurred;  major  improvements  and
   betterments are capitalized.

   Income  taxes:  The Company has  elected to be treated as a  partnership  for
   federal and state  income tax purposes  and  generally  does not incur income
   taxes.  Instead, the Company's earnings and losses are included in the income
   tax returns of the members.  Therefore, no provision or liability for federal
   or state income taxes has been included in these financial statements.

   Net income (loss) per unit: Earnings per unit have been computed on the basis
   of the  weighted  average  number of units  outstanding  during  each  period
   presented. .

   Grant  income:  The  Company  recognizes  grant  income as other  income  for
   reimbursement of expenses  incurred upon complying with the conditions of the
   grant.

   Organizational   costs  and  startup   costs:   The  Company   expenses   all
   organizational and startup costs as incurred.

   Fair value of financial  instruments:  The carrying  amounts of cash and cash
   equivalents,  accounts payable and accrued  expenses  approximate fair value.
   The fair value of long-term debt is estimated to approximate book value based
   on anticipated  interest rates which  management  believes would currently be
   available to the Company for similar issues of debt,  taking into account the
   current credit risk and other market factors.

Note 2. Members' Equity

Effective  March 7, 2008,  the  Company  entered  into a Series C Unit  Issuance
Agreement with ICM, Inc. (the "Series C Agreement") and a Series E Unit Issuance
Agreement  with Bunge North  America,  Inc. (the "Series E Agreement",  together
with the Series C Agreement,  the "Unit Issuance Agreements") in connection with
their  respective  issuances  of the LCs (see Note 3).  Under the Unit  Issuance
Agreements,  the  Company  has  agreed  to pay  Bunge and ICM each a fee for the
issuances  of their  respective  LCs equal to 6% per annum of the  undrawn  face
amount of their  respective LCs. The Unit Issuance  Agreements  provide that the
Company  will use its best efforts to raise funds  through a subsequent  private
placement  offering of Units (the  "Private  Placement"),  or such other form of
equity or debt financing as the Company's Board of Directors may deem necessary,
in an amount sufficient to pay off the Bridge Loan (see Note 3) in full prior to
maturity.  Although the Company anticipates that funds obtained from the Private
Placement or such other equity or debt  financing  will enable it to pay off the
Bridge Loan in full prior to maturity,  in the event that the LCs are drawn upon
as discussed  above or if Bunge or ICM make any payment to Commerce  Bank,  N.A.
(the Bridge  Lender) that reduces  amounts owed by the Company  under the Bridge
Loan (each, a "Bridge Loan Payment"),  the Unit Issuance Agreements provide that
the Company will immediately reimburse Bunge and/or ICM, as applicable,  for the
amount of such Bridge Loan Payment by issuing Units to Bunge and ICM, as further
described below.

Under the Series C Agreement,  if ICM makes a Bridge Loan  Payment,  the Company
will immediately issue Series C Units to ICM based on a Unit price that is equal
to the lesser of $3,000 or one half (1/2) of the lowest  purchase  price paid by
any  party  for a Unit who  acquired  (or who has  entered  into any  agreement,
instrument  or document to acquire)  such Unit as part of the Private  Placement
after the date of the  Series C  Agreement  but prior to the date of any  Bridge
Loan Payment made by ICM. The Series C Agreement  further provides that ICM will
have the right to purchase its pro rata share of any Units issued by the Company
at any time after the date of the Series C Agreement.

                                      F-24

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Unaudited Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 2. Members' Equity (Continued)

Under the Series E Agreement,  if Bunge makes a Bridge Loan Payment, the Company
will  immediately  issue  Series E Units to Bunge  based on a Unit price that is
equal to the  lesser of $3,000 or one half (1/2) of the  lowest  purchase  price
paid  by any  party  for a Unit  who  acquired  (or  who has  entered  into  any
agreement,  instrument  or document to acquire) such Unit as part of the Private
Placement  after the date of the Series E Agreement but prior to the date of any
Bridge Loan Payment made by Bunge. The Series E Agreement  further provides that
Bunge will have the right to purchase  its pro rata share of any Units issued by
the Company at any time after the date of the Series E Agreement.

The  Company's  Amended and  Restated  Operating  Agreement  has been amended to
reflect the terms of the Unit Issuance Agreements.

Note 3. Construction and Revolving Loan/Credit Agreements

In May 2007, the Company entered into a $126,000,000  senior secured debt credit
facility  with  AgStar  Financial  Services,  PCA  ("Agent"),  consisting  of an
$111,000,000  construction loan and a $15,000,000 revolving line of credit under
the terms of a Credit  Agreement  (the  "Credit  Agreement").  Letters of credit
pertaining  to the  construction  may be drawn on the  construction  loan not to
exceed $3,000,000 in aggregate. Borrowings under the construction loan include a
variable  interest  rate based on LIBOR plus  3.65% for each  advance  under the
Credit Agreement. Upon completion of construction,  the construction loan may be
segmented into two credit facilities, an amortized term facility of $101,000,000
and a revolving term facility of $10,000,000.  Upon conversion,  the Company has
the  option of  converting  50% of the term note into  fixed  rate  loans at the
lender's  bonds rate plus 3.25%.  The portion of the term loan not fixed and the
term  revolving  line of credit will accrue  interest equal to LIBOR plus 3.45%.
LIBOR of  December  31,  2007 was  5.54%.  The  Credit  Agreement  requires  the
maintenance of certain financial and non-financial  covenants.  Borrowings under
the Credit  Agreement.are  collateralized  by substantially all of the Company's
assets.  The   construction/revolving   term  credit  facility  require  monthly
principal  payments  starting  the seventh  month  following  conversion  of the
construction  loan to a term  loan.  The  conversion  will  occur 60 days  after
completion of the  construction.  The loan will be amortized over 114 months and
will mature five years after the  conversion  date.  The  revolving  term credit
agreement  expires in five years after the  conversion of the loan at which time
the  principal  outstanding  is due.  Borrowings  are subject to borrowing  base
restrictions  as  defined in the Credit  Agreement.   The Credit  Agreement also
includes certain prepayment  penalties.  There was no balance  outstanding under
the Credit Agreement.as of December 31, 2007.

On November 13, 2007, the Company  received  notification  from Agent requesting
that it immediately provide the Agent with a sworn construction  statement under
the terms of the Credit  Agreement in response to the Company's  updated project
budget  dated  October  29,  2007,  which  reflected  a  budgeted  shortfall  of
$31,000,000.  Agent  further  requested  the  deposit  of  $34,100,000  with the
disbursing  agent under the Credit  Agreement and related  documents  within ten
days.  Thereafter,  the Company and Agent  commenced  discussions  regarding the
potential   construction   funding  gap   projected  in  the  October  29,  2007
construction budget. On January 3, 2008, the Company received  notification from
Agent  requesting  a firm  proposal to address the equity  shortfall  along with
other materials.  As of March 7, 2008, in order to resolve the funding shortfall
and thereby allow the Agent to commence funding under the Credit Agreement,  the
Company made the following arrangements:

The  Company  obtained  a Bridge  Loan from the  Bridge  Lender  in the  maximum
principal  amount of  $36,000,000  (the  "Bridge  Loan").  To remedy  the budget
shortfall,  a drawing of  $34,100,000  under the Bridge Loan has been  deposited
into the Credit Agreement  construction  disbursing account and has been applied
as  required  thereunder.  The Bridge  Loan debt is  secured  by two  letters of
credit, described below.


                                      F-25

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Unaudited Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 3. Construction and Revolving Loan/Credit Agreements (Continued)

Bunge has caused its bank to issue a letter of credit in the amount equal to 76%
of the maximum principal amount of the Bridge Loan in favor of the Bridge Lender
(the "Bunge LC"),  and ICM has caused its lender to similarly  issue a letter of
credit in the amount equal to 24% of the maximum  principal amount of the Bridge
Loan in favor of the Bridge  Lender (the "ICM LC" and,  together  with the Bunge
LC, the "LCs").  Both LCs will expire on March 16, 2009,  and the Bridge  Lender
will only draw against the LCs to the extent that the Company defaults under the
Bridge Loan or if the Company has not repaid the Bridge Loan in full by March 1,
2009.  In the event the Bridge  Lender draws  against the LCs, the amounts drawn
will be in proportion to Bunge's and ICM's respective ownership of the Company's
Units which are not Series A--76% and 24%,  respectively.  As the Company repays
the principal of the Bridge Loan, the LCs' stated amounts will  automatically be
reduced in the same proportion.

The Company entered into the Unit Issuance  Agreements with Bunge and ICM, which
govern the  Company's  repayment of Bunge and/or ICM, as the case may be, in the
event the LCs are drawn upon (see Note 2).

The  terms of the  Credit  Agreement  and the  Company's  Amended  and  Restated
Operating Agreement have been modified to reflect the foregoing.

Note 4. Long-Term Debt

Long-term debt consists of the following as of December 31, 2007:
                                                                                                           2007
                                                                                                  -------------------
Note payable to  Pottawattamie  County,  Iowa,  non-interest  bearing,  due 180 days after          $      1,283,250
ethanol production begins or January 31, 2008, whichever comes first, secured by land (A)

$200,000  Note  payable to Iowa  Department  Economic  Development  ("IDED")  non-interest
bearing  monthly   payments  of  $1,667  due  through  maturity  date  of  March  2012  on
non-forgivable portion (A)                                                                          $        188,333
                                                                                                  -------------------
                                                                                                           1,466,583

Less current maturities                                                                                  (1,298,250)
                                                                                                  -------------------
                                                                                                  $          168,333

Maturities  of  long-term  debt as of September  30, 2007 are as follows:  Years
ending September 30:
         2008                                                                                     $        1,298,250
         2009                                                                                                 20,000
         2010                                                                                                 20,000
         2011                                                                                                 20,000
         2012                                                                                                108,333
                                                                                                  -------------------
                                                                                                  $        1,466,583
                                                                                                  ===================
(A)  The amounts due from Pottawattamie County were paid March 11, 2008.
(B)  The agreement is comprised of two  components.  A $100,000  loan  agreement
     which  is non  interest-bearing  and due in  monthly  payments  of  $1,667,
     beginning  April 2007,  and a final payment of $1,667 due March 2012; and a
     $100,000  forgivable  loan  agreement.  Both notes under this agreement are
     collateralized by substantially all of the Company's assets and subordinate
     to the above $126,000,000  financial  institution debt and construction and
     revolving loan/credit  agreements discussed in Note 3. The $100,000 loan is
     forgivable  upon IDED  approval of creation of  qualifying  jobs as per the
     Master  Contract.  If the  Company  does not meet the  requirements  of the
     contract, the note is due on an agreed upon payment schedule.



                                      F-26

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Unaudited Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 5. Related-Party Transactions

In September  2005, the Company  entered into an agreement that expired May 2007
(and was not  renewed)  with a  management  company  that  included a member and
director on the board of  directors,  for  project  development  services  for a
monthly  fee of  $10,000  per  month,  plus  actual  travel  and other  approved
expenses.  The  agreement  also  included  a fee of up to  $1,600,000  for a 100
million  gallon per year plant that was due upon the  financial  closing for the
project.  Expenses under this agreement totaled $27,577,  $0, and $1,812,492 for
the three months ended December 31, 2007 and 2006 and period from March 28, 2005
(date of inception) to December 31, 2007, respectively.

In September  2006,  the Company  entered into a  design-build  agreement with a
related  party,  a member  of the  Company,  for a  lump-sum  contract  price of
$118,000,000.  As part of the contract,  the Company was required to make a down
payment of 10% of the original  contract price which  $2,000,000 was paid at the
delivery of the letter of intent, an additional  $2,000,000 was paid in November
2006 when the Company broke escrow and the  remaining  $7,800,000 of the 10% was
paid in January 2007. Monthly  applications will be submitted for work performed
in the previous  period  subject to  retainage.  As of December  31,  2007,  the
Company has incurred approximately $74,168,000 of construction in progress under
this contract.

The Company  entered into an agreement in October 2006 with a related  party,  a
member of the Company,  to purchase all of the  distiller's  grains with soluble
(DGS) produced by the plant.  The Company agrees to pay a purchase price subject
to the sales  price,  transportation  costs,  rail lease charge and a fixed rate
marketing fee for the DGS produced.  The  agreement  commences  when the Company
begins  producing  DGS and  continues  for ten years when it will  automatically
renew for  successive  three-year  terms unless a one hundred eighty day written
notice is given of either party's election not to renew before the expiration of
the initial term of the then current  renewal term. In addition,  the Company is
required to deliver written estimates of its anticipated  monthly DGS production
annually and monthly.  The Company is required to pay a minimum annual marketing
fee of $150,000. Beginning on the third anniversary of the effective date of the
agreement and  thereafter,  the annual minimum amount and the purchase price may
be adjusted  based on terms within the contract.  Either party may terminate the
agreement based on specific guidelines in the agreement.

In October 2006,  the Company  entered into an agreement with a related party, a
member of the Company,  to procure all grain required for the ethanol plant. The
Company agreed to pay an agency fee mutually  agreed to by both parties for corn
delivered by truck or rail, with a minimum annual fee of $225,000. The agreement
commences  when the Company  first needs corn for  production.  It is  currently
anticipated  that this will occur September 2008 and will continue for ten years
when it will  automatically  renew for successive  three-year terms unless a one
hundred  eighty day written  notice is given of either  party's  election not to
renew before the  expiration  of the initial  term or the then  current  renewal
term.  Either party may terminate the agreement based on specific  guidelines in
the agreement.

Note 7. Commitments

The total cost of the project,  including the  construction of the ethanol plant
and start-up expenses, is expected to be approximately $224,635,000. The Company
is funding the development of the ethanol plant by using the total equity raised
of $75,654,000,  long term financing of  approximately  $126,000,000  and bridge
financing of approximately $36,000,000.


                                      F-27

Southwest Iowa Renewable Energy, LLC
(A Development Stage Company)

Notes to Unaudited Financial Statements
-------------------------------------------------------------------------------------------------------------------

Note 7. Commitments (Continued)

In September  2006,  the Company  entered into an agreement  with a design-build
contractor  for  construction  of the  ethanol  plant  for a lump  sum  price of
$118,000,000.  The agreement  states that  $11,800,000 will be paid in cash as a
down  payment  to  be  applied  toward   applications   for  payments.   Monthly
applications will be submitted for work performed in the previous period subject
to  retainage.  As of December 31, 2007,  the Company  incurred  $74,168,000  of
construction  in progress.  The Company has included in construction in progress
payments made totaling $48,042,000 to the contractor for the year ended December
31, 2007;  therefore  approximately  $43,832,000 future commitment remains as of
December  31,  2007  which  is  expected  to be paid  in  2008.  Of this  total,
approximately  $21,900,000  is included in accounts  payable as of December  31,
2007.

The Company has also entered into various other  contracts  during 2006 and 2007
for the  construction  of the ethanol  plant,  office  building,  rail track and
acquisition  of  equipment  totaling  approximately  $23,700,000  with a  future
commitment  of  approximately  $5,690,000,  as of December  31,  2007,  which is
expected to be paid in 2008. Of this total, approximately $2,510,000 is included
in accounts payable as of December 31, 2007.

In November 2006, the Company entered into an agreement with an unrelated entity
for  marketing,  selling and  distributing  all of the  ethanol  produced by the
Company.  The Company will pay a fee mutually agreed to by both parties for each
gallon of ethanol sold. This agreement shall be effective  through  December 31,
2010 and will renew annually until terminated by 90 days' written notice.  As of
December 31, 2007, the ethanol plant is not  operational  and no amounts are due
under this agreement.

In November  2006,  the Company  entered into an agreement with a related entity
for marketing,  selling and distributing all of the distillers dried grains with
solubles which are  by-products of the ethanol plant.  Under the agreement,  the
Company will pay a minimum  annual  marketing fee of $250,000.  The term of this
agreement  shall be for ten years  commencing as of  completion  and start-up of
production  of the plant.  As of December  31,  2007,  the ethanol  plant is not
operational and no amounts are due under this agreement.

The Company has entered  into a steam  contract  with an  unrelated  party dated
January 22, 2007, under which the vendor agreed to provide the steam required by
the  Company,  up to 475,000  pounds per hour.  The Company  agreed to pay a net
energy  rate for all steam  service  provided  under the  steam  contract  and a
monthly  demand charge for  condensate  not returned  (steam  delivered less the
condensation  returned).  The net energy  rate is set for first three years then
adjusted each year beginning on the third  anniversary  date. The steam contract
will  remain in effect  for ten years from the  earlier of the date the  Company
commences a continuous grind of corn for ethanol production, or January 1, 2009.

In October,  2007 the  Company  entered  into an  agreement  with an  investment
banking firm, an unrelated  party, to assist in obtaining  additional  equity to
replace the Bridge  Loan.  While the Bridge Loan is not due until March 1, 2009,
the Company's goal is to raise  sufficient  equity to replace the Bridge Loan as
soon as possible.  Initially,  the Company is seeking one or more  institutional
investors to provide the additional  equity.  The Company will pay a monthly fee
of $10,000  until the  agreement is  terminated by both parties or the equity is
secured.

In January,  2008 the Company  entered into an agreement with a related party to
provide engineering support services on an as needed basis. The Company will pay
a hourly fee  mutually  agreed to by both  parties for each hour of  engineering
services provided. This agreement is effective through December 31, 2008.

In March, 2006, the Company entered into the Unit Issuance Agreements,  pursuant
to  which  the  Company  has  agreed  to pay  Bunge  and ICM  each a fee for the
issuances  of their  respective  LCs equal to 6% per annum of the  undrawn  face
amount  of their  respective  LCs for a total  annual  amount  of  approximately
$2,160,000.


                                      F-28

Exhibit Index

Exhibit numbers 10.36 and 10.37 are management contracts.

2        Omitted - Inapplicable.
3(i)     Articles of Organization,  as filed with the Iowa Secretary of State on
         March  28,  2005   (incorporated   by  reference  to  Exhibit  3(i)  of
         Registration  Statement on Form 10 filed by  Registrant  on January 28,
         2008).
4(i)     Second Amended and Restated  Operating  Agreement  dated March 7, 2008
         (incorporated  by  reference  to Exhibit  4(i) of  Amendment  No. 1 to
         Registration  Statement  on Form 10 filed by  Registrant  on March 21,
         2008).
10.1     Agreement  dated  October 13, 2006  between  Southwest  Iowa  Renewable
         Energy, LLC and Bunge North America, Inc. (incorporated by reference to
         Exhibit 10.1 of  Registration  Statement on Form 10 filed by Registrant
         on January 28,  2008).  Portions  of the  Agreement  have been  omitted
         pursuant to a request for confidential treatment.
10.2     Ethanol   Merchandising   Agreement  dated  November  1,  2006  between
         Southwest Iowa Renewable Energy, LLC and Lansing Ethanol Services,  LLC
         (incorporated by reference to Exhibit 10.2 of Registration Statement on
         Form 10 filed by  Registrant  on January  28,  2008).  Portions  of the
         Agreement  have been  omitted  pursuant to a request  for  confidential
         treatment.
10.3     Assignment of Ethanol Merchandising Agreement dated May 2, 2007 between
         AgStar Financial Services, PCA and Southwest Iowa Renewable Energy, LLC
         (incorporated by reference to Exhibit 10.3 of Registration Statement on
         Form 10 filed by Registrant on January 28, 2008).
10.4     Executed  Steam  Service   Contract  dated  January  22,  2007  between
         Southwest Iowa Renewable  Energy,  LLC and  MidAmerican  Energy Company
         (incorporated by reference to Exhibit 10.4 of Registration Statement on
         Form 10 filed by  Registrant  on January  28,  2008).  Portions  of the
         Contract  have been  omitted  pursuant  to a request  for  confidential
         treatment.
10.5     Assignment  of  Steam  Service  Contract  dated  May  2,  2007  between
         Southwest Iowa Renewable Energy, LLC and AgStar Financial Services, PCA
         (incorporated by reference to Exhibit 10.5 of Registration Statement on
         Form 10 filed by Registrant on January 28, 2008).
10.6     Electric  Service  Contract dated  December 15, 2006 between  Southwest
         Iowa Renewable Energy, LLC and MidAmerican Energy Company (incorporated
         by reference to Exhibit 10.6 of Registration Statement on Form 10 filed
         by Registrant on January 28, 2008).
10.7     Assignment  of  Electric  Service  Contract  dated May 2, 2007  between
         Southwest Iowa Renewable Energy, LLC and AgStar Financial Services, PCA
         (incorporated by reference to Exhibit 10.7 of Registration Statement on
         Form 10 filed by Registrant on January 28, 2008).
10.8     Distillers  Grain  Purchase  Agreement  dated  October 13, 2006 between
         Southwest Iowa  Renewable  Energy,  LLC and Bunge North  America,  Inc.
         (incorporated by reference to Exhibit 10.8 of Registration Statement on
         Form 10 filed by  Registrant  on January  28,  2008).  Portions  of the
         Agreement  have been  omitted  pursuant to a request  for  confidential
         treatment.
10.9     Assignment of Distillers  Grain  Purchase  Agreement  dated May 2, 2007
         between  Southwest  Iowa  Renewable  Energy,  LLC and AgStar  Financial
         Services,   PCA   (incorporated   by   reference  to  Exhibit  10.9  of
         Registration  Statement on Form 10 filed by  Registrant  on January 28,
         2008).
10.10    Grain  Feedstock  Agency  Agreement  dated  October  13,  2006  between
         Southwest Iowa Renewable Energy, LLC and AGRI-Bunge,  LLC (incorporated
         by  reference  to Exhibit  10.10 of  Registration  Statement on Form 10
         filed by  Registrant  on January 28,  2008).  Portions of the Agreement
         have been omitted pursuant to a request for confidential treatment.
10.11    Assignment  of Grain  Feedstock  Agency  Agreement  dated  May 2,  2007
         between  Southwest  Iowa  Renewable  Energy,  LLC and AgStar  Financial
         Services,   PCA   (incorporated   by  reference  to  Exhibit  10.11  of
         Registration  Statement on Form 10 filed by  Registrant  on January 28,
         2008).
10.12    Agreement  between  Owner  and  Design/Builder  Based on The Basis of a
         Stipulated  Price dated  September  25,  2006  between  Southwest  Iowa
         Renewable  Energy,  LLC and ICM,  Inc.  (incorporated  by  reference to
         Exhibit 10.12 of Registration  Statement on Form 10 filed by Registrant
         on January 28,  2008).  Portions  of the  Agreement  have been  omitted
         pursuant to a request for confidential treatment.
10.13    Railcar Sublease  Agreement dated June 25, 2007 between  Southwest Iowa
         Renewable Energy,  LLC and Bunge North America,  Inc.  (incorporated by
         reference to Exhibit 10.13 of  Registration  Statement on Form 10 filed
         by Registrant on January 28, 2008). Portions of the Agreement have been
         omitted pursuant to a request for confidential treatment.

10.14    Credit  Agreement  dated May 2, 2007 between  Southwest  Iowa Renewable
         Energy,  LLC  and  AgStar  Financial  Services,  PCA  (incorporated  by
         reference to Exhibit 10.14 of  Registration  Statement on Form 10 filed
         by Registrant on January 28, 2008).
10.15    Security  Agreement dated May 2, 2007 between  Southwest Iowa Renewable
         Energy,  LLC  and  AgStar  Financial  Services,  PCA  (incorporated  by
         reference to Exhibit 10.15 of  Registration  Statement on Form 10 filed
         by Registrant on January 28, 2008).
10.16    Mortgage, Security Agreement Assignment of Rents and Leases and Fixture
         Filing dated May 2, 2007 between Southwest Iowa Renewable  Energy,  LLC
         and AgStar  Financial  Services,  PCA  (incorporated  by  reference  to
         Exhibit 10.16 of Registration  Statement on Form 10 filed by Registrant
         on January 28, 2008).
10.17    Environmental  Indemnity  Agreement dated May 2, 2007 between Southwest
         Iowa  Renewable  Energy,  LLC  and  AgStar  Financial   Services,   PCA
         (incorporated  by reference to Exhibit 10.17 of Registration  Statement
         on Form 10 filed by Registrant on January 28, 2008).
10.18    Convertible  Note dated May 2, 2007 made by  Southwest  Iowa  Renewable
         Energy, LLC in favor of Monumental Life Insurance Company (incorporated
         by  reference  to Exhibit  10.18 of  Registration  Statement on Form 10
         filed by Registrant on January 28, 2008).
10.19    Convertible  Note dated May 2, 2007 made by  Southwest  Iowa  Renewable
         Energy,  LLC in favor of Metlife Bank, N.A.  (incorporated by reference
         to  Exhibit  10.19  of  Registration  Statement  on  Form 10  filed  by
         Registrant on January 28, 2008).
10.20    Convertible  Note dated May 2, 2007 made by  Southwest  Iowa  Renewable
         Energy, LLC in favor of Cooperative Centrale Raiffeisen-Boerenleenbank,
         B.A.  (incorporated  by  reference  to  Exhibit  10.20 of  Registration
         Statement on Form 10 filed by Registrant on January 28, 2008).
10.21    Convertible  Note dated May 2, 2007 made by  Southwest  Iowa  Renewable
         Energy,   LLC  in  favor  of   Metropolitan   Life  Insurance   Company
         (incorporated  by reference to Exhibit 10.21 of Registration  Statement
         on Form 10 filed by Registrant on January 28, 2008).
10.22    Convertible  Note dated May 2, 2007 made by  Southwest  Iowa  Renewable
         Energy,  LLC in favor of First National Bank of Omaha  (incorporated by
         reference to Exhibit 10.22 of  Registration  Statement on Form 10 filed
         by Registrant on January 28, 2008).
10.23    Revolving Line of Credit Note made by Southwest Iowa Renewable  Energy,
         LLC in favor of Cooperative  Centrale  Raiffeisen-Boerenleenbank,  B.A.
         (incorporated  by reference to Exhibit 10.23 of Registration  Statement
         on Form 10 filed by Registrant on January 28, 2008).
10.24    Revolving Line of Credit Note made by Southwest Iowa Renewable  Energy,
         LLC in favor of Metropolitan  Life Insurance  Company  (incorporated by
         reference to Exhibit 10.24 of  Registration  Statement on Form 10 filed
         by Registrant on January 28, 2008).
10.25    Revolving Line of Credit Note made by Southwest Iowa Renewable  Energy,
         LLC in favor of First National Bank of Omaha (incorporated by reference
         to  Exhibit  10.25  of  Registration  Statement  on  Form 10  filed  by
         Registrant on January 28, 2008).
10.26    Term Revolving Note made by Southwest  Iowa  Renewable  Energy,  LLC in
         favor of Metlife Bank, N.A. (incorporated by reference to Exhibit 10.26
         of Registration Statement on Form 10 filed by Registrant on January 28,
         2008).
10.27    Term Revolving Note made by Southwest  Iowa  Renewable  Energy,  LLC in
         favor   of   Cooperative   Centrale   Raiffeisen-Boerenleenbank,   B.A.
         (incorporated  by reference to Exhibit 10.27 of Registration  Statement
         on Form 10 filed by Registrant on January 28, 2008).
10.28    Term Revolving Note made by Southwest  Iowa  Renewable  Energy,  LLC in
         favor of Metropolitan Life Insurance Company (incorporated by reference
         to  Exhibit  10.28  of  Registration  Statement  on  Form 10  filed  by
         Registrant on January 28, 2008).
10.29    Term Revolving Note made by Southwest  Iowa  Renewable  Energy,  LLC in
         favor of First  National  Bank of Omaha  (incorporated  by reference to
         Exhibit 10.29 of Registration  Statement on Form 10 filed by Registrant
         on January 28, 2008).
10.30    Lien  Subordination  Agreement  dated May 2, 2007 among  Southwest Iowa
         Renewable  Energy,  LLC,  AgStar  Financial  Services,   PCA  and  Iowa
         Department  of  Economic  Development  (incorporated  by  reference  to
         Exhibit 10.30 of Registration  Statement on Form 10 filed by Registrant
         on January 28, 2008).
10.31    Value Added Agricultural Product Marketing  Development Grant Agreement
         dated November 3, 2006 between Southwest Iowa Renewable Energy, LLC and
         the United  States of America  (incorporated  by  reference  to Exhibit
         10.31 of  Registration  Statement  on Form 10 filed  by  Registrant  on
         January 28, 2008).
10.32    Engineering   Services   Agreement  dated  November  27,  2006  between
         Southwest  Iowa  Renewable  Energy,   LLC  and  HGM  Associates,   Inc.
         (incorporated  by reference to Exhibit 10.32 of Registration  Statement
         on

         Form 10 filed by  Registrant  on January  28,  2008).  Portions of the
         Contract  have been  omitted  pursuant to a request  for  confidential
         treatment.
10.33    Fee Letter dated May 2, 2007 between  Southwest Iowa Renewable  Energy,
         LLC and AgStar Financial  Services,  PCA  (incorporated by reference to
         Exhibit 10.33 of Registration  Statement on Form 10 filed by Registrant
         on January 28, 2008).
10.34    Design-Build  Agreement dated December 18, 2006 between  Southwest Iowa
         Renewable  Energy,  LLC  and  Todd &  Sargent,  Inc.  (incorporated  by
         reference to Exhibit 10.34 of  Registration  Statement on Form 10 filed
         by Registrant on January 28, 2008).
10.35    Master  Contract  dated  November  21,  2006  between   Southwest  Iowa
         Renewable  Energy,  LLC and Iowa  Department  of  Economic  Development
         (incorporated  by reference to Exhibit 10.35 of Registration  Statement
         on Form 10 filed by Registrant on January 28, 2008).
10.36    Employment  Agreement  dated  January 31, 2007 between  Southwest  Iowa
         Renewable  Energy,  LLC and Mark Drake  (incorporated  by  reference to
         Exhibit 10.36 of Registration  Statement on Form 10 filed by Registrant
         on January 28, 2008).
10.37    Letter  Agreement dated July 23, 2007 between  Southwest Iowa Renewable
         Energy,  LLC and Cindy Patterson  (incorporated by reference to Exhibit
         10.37 of  Registration  Statement  on Form 10 filed  by  Registrant  on
         January 28, 2008).
10.38    First  Amendment  to  Credit  Agreement  dated  March 7,  2008  between
         Southwest Iowa Renewable Energy, LLC and AgStar Financial Services, PCA
         (incorporated  by  reference  to Exhibit  10.38 of  Amendment  No. 1 to
         Registration  Statement  on Form 10 filed by  Registrant  on March  21,
         2008) .
10.39    Amended and Restated  Disbursing  Agreement dated March 7, 2008 between
         Southwest Iowa Renewable Energy, LLC and AgStar Financial Services, PCA
         (incorporated  by  reference  to Exhibit  10.39 of  Amendment  No. 1 to
         Registration  Statement  on Form 10 filed by  Registrant  on March  21,
         2008).
10.40    Promissory  Note dated March 7, 2008 made by Southwest  Iowa  Renewable
         Energy, LLC in favor of Commerce Bank, N.A(incorporated by reference to
         Exhibit 10.40 of Amendment No. 1 to  Registration  Statement on Form 10
         filed by Registrant on March 21, 2008).
10.41    Irrevocable  Standby  Letter of Credit  No.  S500381  made by UMB Bank,
         N.A., for the account of Bunge North America, Inc. in favor of Commerce
         Bank, N.A. dated March 10, 2008  (incorporated  by reference to Exhibit
         10.41 of Amendment No. 1 to Registration  Statement on Form 10 filed by
         Registrant on March 21, 2008).
10.42    Irrevocable  Standby Letter of Credit No.  08SBLC0345  made by INTRUST
         Bank, N.A. for the account of ICM Inc. in favor of Commerce Bank, N.A.
         dated March 7, 2008  (incorporated  by reference  to Exhibit  10.42 of
         Amendment  No.  1 to  Registration  Statement  on  Form  10  filed  by
         Registrant on March 21, 2008).
10.43    Allonge  to  Revolving  Line of  Credit  Note  made by  Southwest  Iowa
         Renewable  Energy,  LLC in favor of First  National Bank of Omaha dated
         March 7, 2008  (incorporated by reference to Exhibit 10.43 of Amendment
         No. 1 to Registration Statement on Form 10 filed by Registrant on March
         21, 2008).
10.44    Allonge  to  Revolving  Line of  Credit  Note  made by  Southwest  Iowa
         Renewable    Energy,    LLC   in   favor   of   Cooperative    Centrale
         Raiffeisen-Boerenleenbank,  B.A., dated March 7, 2008  (incorporated by
         reference to Exhibit 10.44 of Amendment No. 1 to Registration Statement
         on Form 10 filed by Registrant on March 21, 2008).
10.45    Allonge  to  Revolving  Line of  Credit  Note  made by  Southwest  Iowa
         Renewable Energy,  LLC in favor of Metropolitan Life Insurance Company,
         dated March 7, 2008  (incorporated  by  reference  to Exhibit  10.45 of
         Amendment  No.  1  to  Registration  Statement  on  Form  10  filed  by
         Registrant on March 21, 2008).
10.46    Allonge to Convertible  Note made by Southwest  Iowa Renewable  Energy,
         LLC in favor of First  National  Bank of  Omaha,  dated  March 7,  2008
         (incorporated  by  reference  to Exhibit  10.46 of  Amendment  No. 1 to
         Registration  Statement  on Form 10 filed by  Registrant  on March  21,
         2008).
10.47    Allonge to Convertible  Note made by Southwest  Iowa Renewable  Energy,
         LLC in favor of Metlife Bank, N.A.,  dated March 7, 2008  (incorporated
         by  reference  to  Exhibit  10.47 of  Amendment  No. 1 to  Registration
         Statement on Form 10 filed by Registrant on March 21, 2008).
10.48    Allonge to Convertible  Note made by Southwest  Iowa Renewable  Energy,
         LLC in favor of  Metropolitan  Life Insurance  Company,  dated March 7,
         2008  (incorporated by reference to Exhibit 10.48 of Amendment No. 1 to
         Registration  Statement  on Form 10 filed by  Registrant  on March  21,
         2008).
10.49    Allonge to Convertible  Note made by Southwest  Iowa Renewable  Energy,
         LLC in favor of Cooperative Centrale  Raiffeisen-Boerenleenbank,  B.A.,
         dated March 7, 2008  (incorporated  by  reference  to Exhibit  10.49 of
         Amendment  No.  1  to  Registration  Statement  on  Form  10  filed  by
         Registrant on March 21, 2008).
10.50    Allonge to Term Revolving Note made by Southwest Iowa Renewable Energy,
         LLC in favor of First  National  Bank of  Omaha,  dated  March 7,  2008
         (incorporated  by  reference  to Exhibit  10.50 of  Amendment  No. 1 to
         Registration  Statement  on Form 10 filed by  Registrant  on March  21,
         2008).
10.51    Allonge to Term Revolving Note made by Southwest Iowa Renewable Energy,
         LLC in favor of Cooperative Centrale  Raiffeisen-Boerenleenbank,  B.A.,
         dated March 7, 2008  (incorporated  by  reference  to Exhibit  10.51 of
         Amendment  No.  1  to  Registration  Statement  on  Form  10  filed  by
         Registrant on March 21, 2008).
10.52    Allonge to Term Revolving Note made by Southwest Iowa Renewable Energy,
         LLC in favor of Metlife Bank, N.A.,  dated March 7, 2008  (incorporated
         by  reference  to  Exhibit  10.52 of  Amendment  No. 1 to  Registration
         Statement on Form 10 filed by Registrant on March 21, 2008).
10.53    Allonge to Term Revolving Note made by Southwest Iowa Renewable Energy,
         LLC in favor of  Metropolitan  Life Insurance  Company,  dated March 7,
         2008  (incorporated by reference to Exhibit 10.53 of Amendment No. 1 to
         Registration  Statement  on Form 10 filed by  Registrant  on March  21,
         2008).
10.54    Allonge to Convertible  Note made by Southwest  Iowa Renewable  Energy,
         LLC in favor of Monumental Life Insurance Company,  dated March 7, 2008
         (incorporated  by  reference  to Exhibit  10.54 of  Amendment  No. 1 to
         Registration  Statement  on Form 10 filed by  Registrant  on March  21,
         2008).
10.55    Term Revolving Note made by Southwest  Iowa  Renewable  Energy,  LLC in
         favor of Amarillo  National Bank  (incorporated by reference to Exhibit
         10.55 of Amendment No. 1 to Registration  Statement on Form 10 filed by
         Registrant on March 21, 2008).
10.56    Allonge to Term Revolving Note made by Southwest Iowa Renewable Energy,
         LLC  in  favor  of  Amarillo   National  Bank,   dated  March  7,  2008
         (incorporated  by  reference  to Exhibit  10.56 of  Amendment  No. 1 to
         Registration  Statement  on Form 10 filed by  Registrant  on March  21,
         2008).
10.57    Convertible  Note dated May 2, 2007,  made by Southwest  Iowa Renewable
         Energy,  LLC in  favor  of  Amarillo  National  Bank  (incorporated  by
         reference to Exhibit 10.57 of Amendment No. 1 to Registration Statement
         on Form 10 filed by Registrant on March 21, 2008).
10.58    Allonge to Convertible  Note made by Southwest  Iowa Renewable  Energy,
         LLC  in  favor  of  Amarillo   National  Bank,   dated  March  7,  2008
         (incorporated  by  reference  to Exhibit  10.58 of  Amendment  No. 1 to
         Registration  Statement  on Form 10 filed by  Registrant  on March  21,
         2008).
10.59    Revolving Line of Credit Note made by Southwest Iowa Renewable  Energy,
         LLC in favor of Amarillo  National Bank  (incorporated  by reference to
         Exhibit 10.59 of Amendment No. 1 to  Registration  Statement on Form 10
         filed by Registrant on March 21, 2008).
10.60    Allonge  to  Revolving  Line of  Credit  Note  made by  Southwest  Iowa
         Renewable  Energy,  LLC in favor of Amarillo National Bank, dated March
         7, 2008  (incorporated by reference to Exhibit 10.60 of Amendment No. 1
         to  Registration  Statement on Form 10 filed by Registrant on March 21,
         2008).
10.61    Series C Unit Issuance  Agreement dated March 7, 2008 between Southwest
         Iowa Renewable Energy, LLC and ICM, Inc.  (incorporated by reference to
         Exhibit 10.61 of Amendment No. 1 to  Registration  Statement on Form 10
         filed by Registrant on March 21, 2008).
10.62    Series E Unit Issuance  Agreement dated March 7, 2008 between Southwest
         Iowa Renewable Energy, LLC and Bunge North America, Inc.  (incorporated
         by  reference  to  Exhibit  10.62 of  Amendment  No. 1 to  Registration
         Statement on Form 10 filed by Registrant on March 21, 2008).
10.63    Support  Services  Agreement dated January 30, 2008 between  Southwest
         Iowa Renewable Energy, LLC and Bunge North America, Inc. (incorporated
         by  reference  to Exhibit  10.63 of  Amendment  No. 1 to  Registration
         Statement on Form 10 filed by Registrant on March 21, 2008).
11       Omitted - Inapplicable.
12       Omitted - Inapplicable.
16       Omitted - Inapplicable.
24       Omitted - Inapplicable.