ASSIGNMENT AND ASSUMPTION AGREEMENT

ASSIGNMENT AND ASSUMPTION AGREEMENT

THIS ASSIGNMENT AND ASSUMPTION AGREEMENT is made and effective the 31^st day of May, 2006 by and between Gold-Eagle Cooperative (Gold-Eagle) (the Assignor) and Prairie Creek Ethanol, LLC (Assignee).

RECITAL:

The Assignor, Gold-Eagle is desirous of Assigning and Transferring to the Assignee, Prairie Creek Ethanol, LLC an Option Agreement for the purchase of real estate In Kossuth County, Iowa.

NOW, THEREFORE, in consideration of the Recitals and the mutual agreement set forth in this Agreement, and in further consideration for the Option Agreement Assignor and Assignee agree as follows:

1. Assignment of Option Agreement. Gold-Eagle hereby sells, assigns, transfers and conveys to Assignee all of Gold-Eagle’s as right, title and interest in, to and arising out of an Option Agreement dated May 31, 2006 to purchase real estate from Xxxxxxxxx Family, LLC, a copy of which is marked Exhibit “A” attached hereto and made a part hereof.

2. Assumption of Option Agreement. Assignee hereby accepts the Assignment of the Option Agreement to purchase real estate from Xxxxxxxxx Family, LLC in Kossuth County, Iowa and hereby assumes and agrees to perform all of Gold-Eagle’s obligations under the Option Agreement that arise or relate to the date of this Agreement together with the obligations that arise subsequent to date of this Agreement and which relate to the period subsequent to the date of this Agreement. In consideration for this Assignment Assignee further agrees that it shall reimburse Gold-Eagle for all expenses, costs, fees, engineering and any other related expenses advanced by Gold-Eagle in obtaining and or exercising the Option above described.

3. Legal Description. The real estate which is the subject matter of the Option Agreement to be assigned to Assignee is the following described property to wit:

That part of the Northwest Quarter (NW ¼) and the Northwest Quarter (NW ¼) of the Southwest Quarter (SW ¼) lying North of Railroad Right-of-way and the Northwest Quarter (NW ¼) of the Northeast Quarter (NE ¼) all in Section Thirty-six (36), Township Ninety-six (96) North, Range Twenty-seven (27) West of the 5^th P.M., Kossuth County, Iowa, EXCEPT public highways,

AND

The South Half of the Northwest Quarter (S ½ NW ¼) of Section Thirty-five (35), Township Ninety-five (95) North, Range Twenty-seven (27), West of the 5^thP.M., Kossuth County, Iowa AND the North Half of the Northwest Quarter (N ½ NW ¼) of Section Thirty-five (35), Township Ninety-five (95) North, Range Twenty-seven (27), West of the 5^th P.M., Kossuth County, Iowa EXCEPT a tract described as: commencing 2 rods South and 2 rods East of the Northwest corner of said Section 35, thence South 4 rods, thence East 66 rods, thence North 4 rods, thence West 66 rods to point of beginning,

4. Indemnification: Assignee shall defend, indemnify and hold Gold-Eagle harmless from and against any claim, demand, loss, liability, damage, cost or expense including but not limited to attorney’s fess, arising in connection with or resulting from any breach of the Option Agreement, misrepresentation or non-fulfillment of any agreement on the part of Assignee under this agreement.

5. Amendment; Waiver. No amendment, modification, supplement, termination or waiver of or to any provision of this Agreement, or consent to any departure therefrom, shall be effective unless the same shall be in writing and signed on behalf of the party or parties, as applicable. Any amendment modification or supplement of or to any provision of this Agreement, any waiver of any provision of this Agreement, and any departure from the terms of any provision of this Agreement shall be effective only in the specific instance and for the specific purpose for which made or given.

6. Successor and Assigns. This Agreement shall be binding upon and inure to the benefit of the parties hereto and their respective successor and assigns.

7. Counterparts. This Agreements may be executed in any number of counterparts (including by facsimile transmission), each of which shall be deemed an original shall be taken together shall be deemed to constitute one and the same Agreement.

8. Entire Agreement. This Agreement and the Option Agreement constitute the entire agreement between the parties hereto pertaining to the subject matters hereof and supersede all negotiations preliminary agreement and all prior or contemporaneous discussions and understandings of the parties hereto with respect to the subject matter hereof.

9. Effective Date. This agreement is effective May 31, 2006

In witness whereof, the parties have executed this Agreement as of the date first above written.


“ASSIGNOR”			“ASSIGNEE”

GOLD-EAGLE COOPERATIVE			PRAIRIE CREEK ETHANOL, LLC


By: /s/ Xxxx Xxxxxx			By: /s/ Xxxx Xxxxxx

Exhibit “A”

OPTION AGREEMENT

Option agreement made 25^th day of May, 2006, between Xxxxxxxxx Family, LLC, of 000 Xxxxxxx Xxxxxx Xxxxx, Xxxx Xxxxxx, Xxxxxxxxxx (the "Seller"), and Gold-Eagle Cooperative, of 000 X Xxxxxx Xxxxxx, XX Xxx 000, Xxxxxxxxx, Xxxx (the "Buyer").

SECTION ONE

GRANT OF OPTION

A. In consideration of the mutual promises of the parties, the Seller does hereby give and grant to the Buyer the exclusive and irrevocable right, privilege and option to purchase, under the conditions hereinafter provided, all of the Seller's right title and interest in the real property which is located in Kossuth County, State of Iowa, and more particularly described as follows:

AND

The South Half of the Northwest Quarter (S ½ NW ¼) of Section Thirty-five (35), Township Ninety-five (95) North, Range Twenty-seven (27), West of the 5^th P.M., Kossuth County, Iowa AND the North Half of the Northwest Quarter (N ½ NW ¼) of Section Thirty-five (35), Township Ninety-five (95) North, Range Twenty-seven (27), West of the 5^th P.M., Kossuth County, Iowa, EXCEPT a tract described as: commencing 2 rods South and 2 rods East of the Northwest corner of said Section 35, thence South 4 rods, thence East 66 rods, thence North 4 rods, thence West 66 rods to point of beginning,

(the "Property").

6-13-06 MSW

5/31/06 JDR

B. All deposits and payments made by the Buyer to the Seller pursuant to this Agreement prior to the Closing (either directly or through an escrow agent, if any) shall be applied towards the Purchase Price of the Property subject to Section 2D. The Seller fully agrees and acknowledges that the consideration given by the Buyer constitutes legal, adequate, and valuable consideration for the purposes of this Agreement.

C. The total purchase price for the Property shall be $1,500,000.00 for 200 acres, more or less. The consideration for the purchase option shall be $45,000.00 which will be paid by the Buyer upon execution of this agreement. The remaining consideration of the Purchase Price shall be paid by the Buyer at closing.

D. The "Effective Date" shall be the date that the last of the parties to this Agreement signs and executes below.

SECTION TWO

OPTION TERMS

A. The Seller, in consideration for the payment of the Option consideration and other consideration, does hereby give to the Buyer the exclusive right and option to purchase the Property described above (the "Option").

B. The Option consideration shall be delivered to the Seller.

C. If the Buyer exercises this Option, the Option consideration shall be applied towards the Purchase Price of the Property.

D. The Buyer shall have the right to exercise this Option for a period of six months from execution of this agreement on the effective date. The Buyer may either exercise such option or extend the option for an additional six month period. In order to extend the Option for an additional six month period, Buyer shall pay an additional $45,000.00 to Seller. Buyer shall then have the right to exercise such Option during this six month period of time or renew and extend the Option an additional six months. Again, the Seller shall retain the $45,000.00 for each six month period for which the Option is not exercised. Buyer can continue to have additional six month Option periods under the same terms as above as long as the Buyer pays $45,000.00 for each additional period. The Buyer shall exercise this Option by giving written notice by Registered Mail to the Seller at the address indicated above. The date that Seller receives the Notice, shall be known as the “Date of Commencement”.

E. It is understood and agreed that time is of essence as to the payment of the Purchase Price under this provision. If the Buyer does not exercise the terms of this Option by the ending date as specified above, then the right and option set forth herein shall immediately terminate and all deposits paid shall be kept by the Seller.

SECTION THREE

PROMISES OF PARTIES FOLLOWING EXERCISE OF OPTION

Subject to the Buyer exercising this Option, the Seller and the Buyer agree that the Seller shall sell and the Buyer shall buy the Property upon the following terms and conditions.

A. Representations and Warranties

To induce the Buyer to enter into this Agreement, the Seller makes the following representations, warranties, and covenants:

1. Seller has good and marketable fee simple title to the Property, free and clear of all liens, property taxes, encumbrances, and restrictions, except for those restrictions appearing of record, taxes for the year of closing, encumbrances that will be cleared prior to closing, and encumbrances that will be cleared at the closing out of the Seller's proceeds from the Purchase Price. Seller is in sole possession of the above described real property.

2. There are no condemnations or similar proceedings affecting any part of the Property and no such proceeding shall be pending on the Closing Date. To the best of the Seller's knowledge, no such condemnations or other proceeds are threatened or planned.

3. There are no toxic wastes on, in or around the Property and the Property has not been used to manufacture, store, or dispose of environmentally hazardous materials

4. There are no service contracts or agreements relating to the operation, maintenance, or security of the property under which the Seller is bound and which will survive the closing.

5. All encroachments, reservations, limitations, road right of ways, or servitudes affecting the Property are disclosed in the Public Records.

6. The Seller is not subject to any commitment, obligation, or agreement, including, but not limited to, any right of first refusal or option to purchase, granted to a third party, which would or could prevent the Seller from completing the sale of the Property as contemplated by this Agreement.

7. Seller shall be in sole and exclusive possession of the Property and will deliver possession of the Property free of all leases on the Closing Date.

B. Conditions Precedent

The obligations of the Buyer to close this transaction are subject to the Buyer having given Notice to Purchase and subject to the following:

1. All representations and warranties of the Seller shall be true and correct as of the Closing Date as if such representations and warranties were being made on such date.

2. Seller shall have performed all covenants to be performed by the Seller as is herein provided.

3. The Property shall be vacant and any tenant relocation costs shall be incurred by the Seller. Seller shall be responsible to deliver possession free of any claims, leases, management agreements or such other possessory rights.

4. If any of such conditions are not fulfilled on or as of the Closing Date, and notwithstanding anything to the contrary in this Agreement, the Buyer shall have the right to terminate this Agreement and to obtain a full refund of any deposits made to the Seller or escrow agent whereupon all parties shall be relieved of any further obligations hereunder.

C. Clear Title

1. Within 90 days of the execution of this Agreement by the Seller, the Seller, at their expense, shall obtain an abstract of title to the Real Estate continued through the date of acceptance of this offer, and deliver it to Buyers for examination. It shall show merchantable title in Sellers in conformity with this agreement, Iowa law and Title Standards of the Iowa State Bar Association. The abstract shall become the property of the Buyers when the purchase price is paid in full. Sellers shall pay the costs of any additional abstracting and title work due to any act or omission of Sellers, including transfers by or the death of Sellers or their assignees. Seller shall also provide any existing surveys for the Property that are in the Seller's possession or which the Seller might obtain possession of by reasonable efforts. The Buyer shall return to these items to the Seller if the closing never occurs and this Contract is terminated.

2. Seller shall convey a marketable title, subject only to liens, encumbrances, exceptions, or qualifications set forth in this Agreement and those which shall be discharged by Seller at or before closing. Marketable title shall be determined according to applicable title standards adopted by authority of the Iowa State Bar Association and in accordance with law.

3. If the Buyer discovers that the title is defective, the Buyer shall notify the Seller in writing specifying the defect(s). If the defect(s) render the title unmarketable or uninsurable the Seller will have 120 days from receipt of notice within which to remove the defect(s), and if the Seller is unsuccessful in removing them within such time, the Buyer shall have the option of either accepting the title as it then is, or demanding a refund of all monies paid hereunder which shall forthwith be returned to the Buyer and thereupon the Buyer and the Seller shall be released as to one another of all further obligations under this Agreement. All expenses to clear title defects shall be paid by the Seller.

D. Closing

1. The closing date shall be set by mutual agreement after Buyer notifies Seller that it will exercise its option, which date shall be not less than 60 days and no later than 90 days after the exercise of the purchase option by the buyer, unless extended by other provisions of this Contract or by the mutual consent of both parties. The closing shall be held in Goldfield, Xxxxxx County, Iowa, at the office of the attorney or other closing agent designated by the Buyer.

2. At closing the Buyer shall pay the cash portion of the Purchase Price by bank cashier's check or certified check either of which shall be issued by and drawn on a local institution and the Seller shall furnish the deed, an absence of lien affidavit, non-foreign status affidavit, and any corrective instruments that may be required in connection with perfecting the title. The Buyer shall furnish the closing statement.

3. The Seller shall pay the following closing costs: state documentary stamps and surtax charges, the cost of recording any corrective instruments and the title update charges necessary for the title insurance. The Buyer shall pay the cost of recording the deed, title insurance premiums and the cost for recording the purchase money mortgage (if any).

E. Restrictions; Easements; Limitations

The Buyer shall take title subject to: zoning, restrictions, prohibitions, and other requirements imposed by governmental authority; restrictions and matters appearing on the plat or otherwise common to the subdivision; public utility easements of record; taxes for year of closing and subsequent years; assumed mortgages and purchase money mortgages, and the following other exceptions (if any): provided, however, that there exists at closing no violation of the foregoing and the same does not prevent the use of the property for manufacturing and refining purposes.

F. Survey

The Buyer, at the Buyer's expense, within 120 days following the Date of Notice of Exercising its Option, may have the Property surveyed and certified by a registered Iowa surveyor. If the survey shows any encroachment on the Property or that improvements intended to be located on the Property in fact encroach on setback lines, easements, lands of others, or violate any restrictions, Agreement covenants, or applicable governmental regulations, the same shall be treated as a title defect.

G. Liens

The Seller shall furnish to the Buyer at time of closing an affidavit attesting to the absence, unless otherwise provided for herein, of any financing statements, claims of lien or potential lienors known to the Seller and further attesting that there have been no improvements or repairs to the Property for 90 days immediately preceding the date of closing in a form satisfactory to the Buyer. If the Property has been improved, or repaired within such time, the Seller shall deliver releases or waivers of mechanic's liens, executed by all general contractors, subcontractors, suppliers, and materialmen, in addition to the Seller's lien affidavit setting forth the names of all such general contractors, subcontractors, suppliers, and materialmen and further reciting that in fact all bills for work to the Property or personalty which could serve as a basis for a mechanic's lien or a claim for damages have been paid or will be paid at closing.

H. Prorations

Taxes and assessments (if any) shall be prorated through the day to the closing. Cash at closing shall be increased or decreased as may be required by said prorations. All prorations will be made through the day prior to occupancy if occupancy occurs before closing. Taxes shall be prorated based on the current year's tax with due allowance made for maximum allowable discount and homestead or other exemptions if allowed for said year.

I. Special Assessment Liens

Certified, confirmed, and ratified special assessment liens as of the date of closing (and not as of Effective Date) are to be paid by the Seller. Pending liens as of the date of closing shall be assumed by Buyer, provided, however, that if the improvement has been substantially completed as of the Effective Date, such pending lien shall be considered as certified, confirmed, and ratified and the Seller shall, at closing, be charged an amount equal to the last estimate by the public body of assessment for the improvement.

J. Attorney's Fees; Costs

In connection with any litigation arising out of this Agreement, the prevailing party shall be entitled to recover reasonable attorney's fees and costs.

K. Contract Not Recordable; Persons Bound; Notice

Neither this Agreement nor any notice thereof shall be recorded in any public records. This Agreement shall bind and inure to the benefit of the parties hereto and their successors in interest. Whenever the context permits, singular shall include plural and one gender shall include all. Notice given by or to the attorney for any party shall be as effective as if given by or to the party.

L. Occupancy

Seller represents that there are no parties in occupancy other than the Seller. Seller agrees to deliver occupancy of the property at the time of closing unless otherwise stated herein. If occupancy is to be delivered prior to closing, Buyer assumes all risk of loss to the Property and personalty for the date of occupancy, and shall be responsible and liable for maintenance thereof from such date, and shall be deemed to have accepted the Property and personalty in their existing condition as of the time of taking occupancy unless otherwise stated herein or in a separate writing.

M. Conveyance

Seller shall convey title to the Property by statutory warranty, trustee, personal representative, or guardian deed, as appropriate to the status of the Seller, subject only to matters contained in Section C hereof and those otherwise accepted by Buyer.

N. Other Agreements

No prior or present agreements or representations shall be binding upon Buyer or Seller unless included in this Agreement. No modifications or changes in this Agreement shall be valid or binding upon the parties unless in writing and executed by the party or parties to be bound thereby.

O. Typewritten or Handwritten Provisions

Typewritten or handwritten provisions inserted herein or attached hereto as addenda shall control all printed provisions of this contract in conflict therewith.