Exhibit 99.1
PROMISSORY NOTE
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Principal Loan Date Maturity Loan No. Call/Coll Account Officer Initials
$8,837,300.00 01-20-2004 04-20-2011 57748 37/400 119284 JB
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Reference in the shaded area are for Lender's use only and do not limit the
applicability of this document to any particular loan or item.
Any item above containing*****has been omitted due to text length limitations.
Borrower: HUSKER AG, LLC (TIN: ▇▇-▇▇▇▇▇▇▇) Lender: ▇▇▇▇▇▇▇ BANK NATIONAL
P.O. Box 10 ASSOCIATION
Plainview, NE 68769 4191 So. 2nd Street
P.O. Box 7338
St. Cloud, MN 56302
Principal Amount:$8,837,300.00 Initial Rate:5.250%
Date of Note:January 20,2004
PROMISE TO PAY. HUSKER AG, LLC ("Borrower") promises to pay to ▇▇▇▇▇▇▇ BANK
NATIONAL ASSOCIATION ("Lender"), or order, in lawful money of the United States
of America, the principal amount of Eight Million Eight Hundred Thirty-seven
Thousand Three Hundred & 00/100 Dollars ($8,837,300.00), together with interest
on the unpaid principal balance from January 20, 2004, until paid in full.
PAYMENT. Subject to any payment changes resulting from changes in the Index,
Borrower will pay this loan on demand. Payment in full is due immediately upon
▇▇▇▇▇▇'s demand. If no demand is made, ▇▇▇▇▇▇▇▇ will pay this loan in 87
payments of $122,668.43 each payment. ▇▇▇▇▇▇▇▇'s first payment is due February
20, 2004, and all subsequent payments are due on the same day of each month
after that. ▇▇▇▇▇▇▇▇'s final payment will be due on April 20, 2011, and will be
for all principal and all accrued interest not yet paid. Payments include
principal and interest. Unless otherwise agreed or required by applicable law,
payments will be applied first to any accrued unpaid interest; then to
principal; and then to any unpaid collection costs. The annual interest rate for
this Note is computed on a 365/360 basis; that is, by applying the ratio of the
annual interest rate over a year of 360 days, multiplied by the outstanding
principal balance, multiplied by the actual number of days the principal balance
is outstanding. Borrower will pay Lender at ▇▇▇▇▇▇'s address shown above or at
such other place as Lender may designate in writing.
VARIABLE INTEREST RATE. The interest rate on this Note is subject to change from
time to time based on changes in an independent index which is the WALL STREET
JOURNAL PRIME RATE (the "Index"). The Index is not necessarily the lowest rate
charged by Lender on its loans. If the Index becomes unavailable during the term
of this loan, Lender may designate a substitute index after notice to Borrower.
Lender will tell Borrower the current Index rate upon ▇▇▇▇▇▇▇▇'s request. The
interest rate change will not occur more often than each 1ST DAY OF EACH
CALENDAR QUARTER. Borrower understands that Lender may make loans based on other
rates as well. The Index currently is 4.00% per annum. The interest rate to be
applied to the unpaid principal balance of this Note will be at a rate of 1.250
percentage points over the Index, resulting in an initial rate of 5.250% per
annum. NOTICE: Under no circumstances will the interest rate on this Note be
more than the maximum rate allowed by applicable law. Whenever increases occur
in the interest rate, Lender, at its option, may do one or more of the
following: (A) increase Borrower's payments to ensure Borrower's loan will pay
off by its original final maturity date, (B) increase Borrower's payments to
cover accruing interest, (C) increase the number of Borrower's payments.
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PREPAYMENT PENALTY. Upon prepayment of this Note, ▇▇▇▇▇▇ is entitled to the
following prepayment penalty: THIS NOTE MAY NOT BE PREPAID, EITHER IN WHOLE OR
IN PART, EXCEPT AS PROVIDED HEREIN, EFFECTIVE JANUARY 20, 2004 THIS NOTE MAY BE
PREPAID AT ANY TIME IN WHOLE OR IN PART UPON 10 DAYS WRITTEN NOTICE TO THE
HOLDER HEREOF AND UPON PAYMENT OF A PREPAYMENT PREMIUM IN AN AMOUNT EQUAL TO
5.0% OF THE AMOUNT OF SUCH PREPAYMENT DURING YEAR ONE, 4.0% OF THE AMOUNT OF
SUCH PREPAYMENT DURING THE YEAR TWO, 3.0% OF THE AMOUNT OF SUCH PREPAYMENT
DURING THE YEAR THREE, 2.0% OF THE AMOUNT OF SUCH PREPAYMENT DURING YEAR FOUR,
AND 1.0% OF THE AMOUNT OF SUCH PREPAYMENT DURING YEAR FIVE. ALL PREPAYMENTS
SHALL, AT THE OPTION OF THE HOLDER HEREOF, FIRST BE APPLIED TO ACCRUED INTEREST
AND THE REMAINDER THEREOF TO PRINCIPAL. NOTWITHSTANDING ANY SUCH PREPAYMENT(S),
UNTIL THE PRINCIPAL AMOUNT OF THIS NOTE AND ALL INTEREST THEREON IS PAID IN
FULL, THE MAKER HEREOF SHALL CONTINUE TO MAKE INSTALLMENT PAYMENTS OF PRINCIPAL
AND INTEREST IN THE AMOUNTS AND AT THE TIMES PROVIDED HEREIN. Except for the
foregoing, Borrower may pay all or a portion of the amount owed earlier than it
is due. Early payments will not, unless agreed to by ▇▇▇▇▇▇ in writing, relieve
▇▇▇▇▇▇▇▇ of ▇▇▇▇▇▇▇▇'s obligation to continue to make payments under the payment
schedule. Rather early payments will reduce the principal balance due any may
result in Borrower's making fewer payments. ▇▇▇▇▇▇▇▇ agrees not to send Lender
payments marked "paid in full", "without recourse", or similar language. If
Borrower sends such a payment, ▇▇▇▇▇▇ may accept it without losing any of
▇▇▇▇▇▇'s rights under this Note, and Borrower will remain obligated to pay any
further amount owed to Lender. All written communications concerning disputed
amounts, including any check or other payment instrument that indicates that the
payment constitutes "payment in full" of the amount owed or that is tendered
with other conditions or limitations or as full satisfaction of a disputed
amount must be mailed or delivered to: ▇▇▇▇▇▇▇ BANK NATIONAL ASSOCIATION, ▇▇▇▇
▇▇ ▇▇▇ ▇▇ ▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇-▇▇▇▇.
DEFAULT. Each of the following shall constitute an event of default ("Event of
Default") under this Note:
Payment Default. Borrower fails to make any payment within ten (10) days
when due under this Note.
Other Defaults. Borrower materially fails to comply with or to perform any
other term, obligation, covenant or condition contained in this Note or in
any of the related documents or to comply with or to materially perform
any term, obligation, covenant or condition contained in any other
agreement between Lender and Borrower.
Default in Favor of Third Parties. Borrower or any Grantor defaults under
any loan, extension of credit, security agreement, purchase or sales
agreement, or any other agreement, in favor of any other creditor or
person that may materially affect any of Borrower's property or Borrower's
ability to repay this Note or perform Borrower's obligations under this
Note or any of the related documents.
False Statements. Any warranty, representation or statement made or
furnished to Lender by Borrower or on Borrower's behalf under this Note or
the related documents is false or misleading in any material respect,
either now or at the time made or furnished or becomes false or misleading
at any time thereafter.
Death or Insolvency. The dissolution of Borrower (regardless of whether
election to continue is made), or any other termination of ▇▇▇▇▇▇▇▇'s
existence as a going business, the insolvency of Borrower, the appointment
of a receiver for any part of ▇▇▇▇▇▇▇▇'s property, any assignment for the
benefit of creditors, any type of creditor workout, or the commencement of
any proceeding under any bankruptcy or insolvency laws by or against
Borrower.
Creditor or Forfeiture Proceedings. Commencement of foreclosure of
forfeiture proceedings, whether by judicial proceedings, self-help,
repossession or any other method, by any creditor of Borrower or by any
governmental agency against any collateral securing the loan. This
includes a garnishment of any of ▇▇▇▇▇▇▇▇'s accounts, including deposit
accounts, with Lender. However, this Event of Default shall not apply if
there is a good faith dispute by ▇▇▇▇▇▇▇▇ as to the validity or
reasonableness of the claim which is the basis of the creditor or
forfeiture proceeding and if Borrower gives ▇▇▇▇▇▇ written notice of the
creditor or forfeiture proceeding and deposits with Lender monies or a
surety bond for the creditor or forfeiture proceeding, in an amount
determined by Lender, in its sole discretion, as being an adequate reserve
or bond for the dispute.
Events Affecting Guarantor. Any of the preceding events occurs with
respect to any guarantor, endorser, surety, or accommodation party of any
of the indebtedness or any guarantor, endorser, surety, or accommodation
party dies or becomes incompetent, or revokes or disputes the validity of,
or liability under, any guaranty of the indebtedness evidenced by this
Note. In the event of a death, Lender, at its option, may, but shall not
be required to, permit the guarantor's estate to assume unconditionally
the obligations arising under the guaranty in a manner satisfactory to
Lender, and, in doing so, cure any Event of Default.
Adverse Change. A material adverse change occurs in Borrower's financial
condition.
Cure Provisions. If any default, other than a default in payment is
curable and if Borrower has not been given a notice of a breach of the
same provision of this Note within the preceding twelve (12) months, it
may be cured (and no event of default will have occurred) if Borrower,
after receiving written notice from Lender demanding cure of such default:
(1) cures the default within fifteen (15) days; or (2) if the cure
requires more than fifteen (15) days, immediately initiates steps which
lender deems in ▇▇▇▇▇▇'s sole discretion to be sufficient to cure the
default and thereafter continues and completes all reasonable and
necessary steps sufficient to produce compliance as soon as reasonably
practical.
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LENDER'S RIGHTS. Upon default, ▇▇▇▇▇▇ may declare the entire unpaid principal
balance on this Note and all accrued unpaid interest immediately due, and then
Borrower will pay that amount.
ATTORNEYS' FEES; EXPENSES. Lender may hire or pay someone else to help collect
this Note if Borrower does not pay. Borrower will pay Lender that amount. This
includes, subject to any limits under applicable law, ▇▇▇▇▇▇'s reasonable
attorneys' fees and ▇▇▇▇▇▇'s legal expenses, whether or not there is a lawsuit,
including reasonable attorneys' fees, expenses for bankruptcy proceedings
(including efforts to modify or vacate any automatic stay or injunction), and
appeals. If not prohibited by applicable law, ▇▇▇▇▇▇▇▇ also will pay any court
costs, in addition to all other sums provided by law.
JURY WAIVER. ▇▇▇▇▇▇ and ▇▇▇▇▇▇▇▇ hereby waive the right to any jury trial in any
action, proceeding, or counterclaim brought by either ▇▇▇▇▇▇ or Borrower against
the other.
GOVERNING LAW. This Note will be governed by, construed and enforced in
accordance with federal law and the laws of the State of Minnesota. This Note
has been accepted by ▇▇▇▇▇▇ in the State of Minnesota.
RIGHT OF SETOFF. To the extent permitted by applicable law, Lender reserves a
right of setoff in all Borrower's accounts with Lender (whether checking,
savings, or some other account). This includes all accounts Borrower holds
jointly with someone else and all accounts Borrower may open in the future.
However, this does not include any IRA or ▇▇▇▇▇ accounts, or any trust accounts
for which setoff would be prohibited by law. Borrower authorizes ▇▇▇▇▇▇, to the
extent permitted by applicable law, to charge or setoff all sums owing on the
indebtedness against any and all such accounts, and, at ▇▇▇▇▇▇'s option, to
administratively freeze all such accounts to allow Lender to protect ▇▇▇▇▇▇'s
charge and setoff rights provided in this paragraph.
COLLATERAL. ▇▇▇▇▇▇▇▇ acknowledges this Note is secured by COLLATERAL AS
DESCRIBED IN THE FOLLOWING DOCUMENTS: DEED OF TRUST, ASSIGNMENT OF RENTS AND
SECURITY AGREEMENT DATED JANUARY 20, 2004.
LATE CHARGE. SHOULD BORROWER FAIL TO PAY ANY PAYMENT REQUIRED DURING THE TERM OF
THIS LOAN, OR TO PAY THE INDEBTEDNESS UPON THE MATURITY OF THIS LOAN, AND SHOULD
ANY SUCH AMOUNT REMAIN UNPAID FOR A PERIOD OF ten (10) DAYS FOLLOWING ITS DUE
DATE, THEN BORROWER AGREES AND COVENANTS TO PAY TO LENDER A LATE CHARGE IN THE
AMOUNT OF FIVE PERCENT (5%) OF ANY SUCH AMOUNT, INCLUDING THE AMOUNT DUE AND
PAYABLE AT MATURITY.
ESCROW PROVISION. ▇▇▇▇▇▇▇▇ AGREES TO MAINTAIN A DEPOSIT ACCOUNT (THE ESCROW
ACCOUNT) WITH ▇▇▇▇▇▇, FROM WHICH REAL ESTATE AND PROPERTY TAXES ON THE MORTGAGED
PROPERTY WILL BE PAID. DEPOSITS INTO THE ESCROW ACCOUNT WILL BE MADE MONTHLY
ALONG WITH THE BORROWER'S SCHEDULED LOAN PAYMENTS AND WILL BE EQUAL TO 1/12 OF
THE AMOUNT OF THE REAL ESTATE TAXES AS PROJECTED TO BE OWED IN THE NEXT 14
MONTHS FOLLOWING EACH TAX ESCROW PAYOUT. THE MONTHLY ESCROW PAYMENTS WILL BEGIN
ALONG WITH THE BORROWER'S FIRST SCHEDULED PRINCIPAL AND INTEREST PAYMENT.
▇▇▇▇▇▇▇▇ AGREES AT ALL TIMES TO MAINTAIN A 2 MONTH ESCROW RESERVE. ▇▇▇▇▇▇▇▇ ALSO
AGREES THAT IF FOR ANY REASON THE ESCROW ACCOUNT BALANCE IS INSUFFICIENT TO MAKE
THE REQUIRED TAX PAYMENT AS REQUIRED, THAT WITHIN 15 DAYS OF NOTICE FROM LENDER,
BORROWER WILL FORWARD TO LENDER THE AMOUNTS NECESSARY TO PAY ALL AMOUNTS DUE AND
RE-ESTABLISH THE 2 MONTH ESCROW RESERVE.
PRIOR NOTE. THIS NOTE IS A RENEWAL, EXTENSION AND REARRANGEMENT OF NOTE #53455,
DATED 12-19-2001, IN THE ORIGINAL PRINCIPAL AMOUNT OF $20,000,000.
SUCCESSOR INTERESTS. The terms of this Note shall be binding upon ▇▇▇▇▇▇▇▇, and
upon ▇▇▇▇▇▇▇▇'s heirs, personal representatives, successors and assigns, and
shall inure to the benefit of Lender and its successors and assigns.
GENERAL PROVISIONS. This Note is payable on demand. The inclusion of specific
default provisions or rights of Lender shall not preclude ▇▇▇▇▇▇'s right to
declare payment of this Note on its demand. Lender may delay or forgo enforcing
any of its rights or remedies under this Note without losing them. Borrower and
any other person who signs, guarantees or endorses this Note, to the extent
allowed by law, waive presentment, demand for payment, and notice of dishonor.
Upon any change in the terms of this Note, and unless otherwise expressly stated
in writing, no party who signs this Note, whether as maker, guarantor,
accommodation maker or endorser, shall be released from liability. All such
parties agree that Lender may renew or extend (repeatedly and for any length of
time) this loan or release any party or guarantor or collateral; or impair, fall
to realize upon or perfect ▇▇▇▇▇▇'s security interest in the collateral; and
take any other action deemed necessary by ▇▇▇▇▇▇ without the consent of or
notice to anyone. All such parties also agree that ▇▇▇▇▇▇ may modify this loan
without the consent of or notice to anyone other than the party with whom the
modification is made. The obligations under this Note are joint and several.
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SECTION DISCLOSURE. This loan is made under Minnesota Statutes, Section 47.59.
PRIOR TO SIGNING THIS NOTE, ▇▇▇▇▇▇▇▇ READ AND UNDERSTOOD ALL THE PROVISIONS OF
THIS NOTE, INCLUDING THE VARIABLE INTEREST RATE PROVISIONS, ▇▇▇▇▇▇▇▇ AGREES TO
THE TERMS OF THE NOTE.
BORROWER ACKNOWLEDGES RECEIPT OF A COMPLETED COPY OF THIS PROMISSORY NOTE.
BORROWER:
HUSKER AG, LLC
By: /s/ ▇▇▇▇ ▇▇▇▇▇▇▇ By:/s/ ▇▇▇▇ ▇▇▇▇▇
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▇▇▇▇ ▇▇▇▇▇▇▇, Chairman ▇▇▇▇ ▇▇▇▇▇, Secretary
of HUSKER AG, LLC of HUSKER AG, LLC
By: /s/ ▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇ By:/s/▇▇▇▇ ▇▇▇▇▇▇▇▇▇
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▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Vice Chairman ▇▇▇▇ ▇▇▇▇▇▇▇▇▇, Treasurer
of HUSKER AG, LLC of HUSKER AG, LLC
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