AMENDED AND RESTATED MASTER LOAN AGREEMENT

Exhibit 10.31

MLA No. Z269F

AMENDED AND RESTATED
MASTER LOAN AGREEMENT

THIS AMENDED AND RESTATED MASTER LOAN AGREEMENT (“Agreement”) is entered into as of July 21, 2003, between CoBANK, ACB (“CoBank”) and AMERICAN CRYSTAL SUGAR COMPANY, Moorhead, Minnesota (the “Company”), and amends and restates that Master Loan Agreement dated as of March 31, 2000.

BACKGROUND

CoBank and the Company are parties to a Master Loan Agreement dated March 31, 2000 and numbered Z269 (as previously amended, the “Existing Agreement”). Pursuant to the terms of the Existing Agreement, the parties entered into one or more Supplements thereto to evidence specific loans from CoBank to the Company. CoBank and the Company now desire to amend and restate the Existing Agreement and to apply such new agreement to the existing Supplements, as well as any new Supplements that may be issued hereunder to evidence any new loans that CoBank may make to the Company. For that reason and for valuable consideration (the receipt and sufficiency of which are hereby acknowledged), CoBank and the Company hereby agree that the Existing Agreement shall be amended and restated to read as follows:

SECTION 1. Supplements. In the event the Company desires to borrow from CoBank and CoBank is willing to lend to the Company, or in the event CoBank and the Company desire to consolidate any existing loans hereunder, the parties will enter into a Supplement to this Agreement (a “Supplement”). Each Supplement will set forth the amount of the loan, the purpose of the loan, the interest rate or rate options applicable to that loan, the repayment terms of the loan, and any other terms and conditions applicable to that particular loan. Each loan will be governed by the terms and conditions contained in this Agreement and in the Supplement relating to the loan.

SECTION 2. Availability. Loans will be made available on any day on which CoBank and the Federal Reserve Banks are open for business upon the telephonic or written request of the Company. Requests for loans must be received no later than 12:00 noon Company’s local time on the date the loan is desired. Loans will be made available by wire transfer of immediately available funds to such account or accounts as may be authorized by the Company. The Company shall furnish to CoBank a duly completed and executed copy of a CoBank Delegation and Wire and Electronic Transfer Authorization Form, and CoBank shall be entitled to rely on (and shall incur no liability to the Company in acting on) any request or direction furnished in accordance with the terms thereof.

SECTION 3. Repayment. The Company’s obligation to repay each loan shall be evidenced by the promissory note set forth in the Supplement relating to that loan or by such replacement note as CoBank shall require. CoBank shall maintain a record of all loans, the interest accrued thereon, and all payments made with respect thereto, and such record shall, absent proof of manifest error, be conclusive evidence of the outstanding principal and interest on the loans. All payments shall be made by wire transfer of immediately available funds or by check. Wire transfers shall be made to ABA No. 000000000 for advice to and credit of CoBANK (or to such other account as CoBank may direct by notice). The Company shall give CoBank telephonic notice no later than 12:00 noon Company’s local time of its intent to pay by wire and funds received after 3:00 p.m. Company’s local time shall be credited on the next business day. Checks shall be mailed to XxXxxx, Xxxxxxxxxx 000, Xxxxxx, Xxxxxxxx, 00000-0000

(or to such other place as CoBank may direct by notice). Credit for payment by check will not be given until the latter of: (a) the day on which CoBank receives immediately available funds; or (b) the next business day after receipt of the check.

SECTION 4. Capitalization. The Company agrees to purchase such equity in CoBank as CoBank may from time to time require in accordance with its Bylaws. However, the maximum amount of equity which the Company shall be obligated to purchase in connection with any loan may not exceed the maximum amount permitted by the Bylaws at the time the Supplement relating to that loan is entered into or such loan is renewed or refinanced by CoBank.

SECTION 5. Security. The Company’s obligations under this Agreement, all Supplements (whenever executed), and all instruments and documents contemplated hereby or thereby, shall be secured by a statutory first lien on all equity which the Company may now own or hereafter acquire in CoBank. This security shall be in addition to any other security that may otherwise be required or provided.

SECTION 6. Conditions Precedent.

(A) Conditions to Initial Supplement. CoBank’s obligation to extend credit under the initial Supplement hereto is subject to the conditions precedent that CoBank receive, in form and substance satisfactory to CoBank, each of the following:

(i) This Agreement, Etc. A duly executed copy of this Agreement and all instruments and documents contemplated hereby.

(ii) Opinion of Counsel. A favorable opinion from the Company’s counsel addressed to CoBank covering each matter as CoBank may reasonably require.

(iii) Evidence of Authority. Such certified board resolutions, evidence of incumbency, and other evidence that CoBank may require that the Supplement, all instruments and documents executed in connection therewith, and, in the case of initial Supplement hereto, this Agreement and all instruments and documents executed in connection herewith, have been duly authorized and executed.

(B) Conditions to Each Supplement. CoBank’s obligation to extend credit under each Supplement, including the initial Supplement, is subject to the conditions precedent that CoBank receive, in form and content satisfactory to CoBank, each of the following:

(i) Supplement. A duly executed copy of the Supplement and all instruments and documents contemplated thereby.

(ii) Fees and Other Charges. All fees and other charges specifically permitted by this Agreement or the Supplements, as well as reasonable expenses for outside counsel.

(iii) Evidence of Perfection, Etc. Such evidence as CoBank may require that CoBank has a duly perfected first priority lien on all security for the Company’s obligations, and that the Company is in compliance with Section 8(D) hereof.

(C) Conditions to Each Loan. CoBank’s obligation under each Supplement to make any loan to the Company thereunder is subject to the condition that no “Event of Default” (as defined in Section 11 hereof) or event that with the giving of notice and/or the passage of time would become an Event of Default hereunder (a “Potential Default”), shall have occurred and be continuing.

SECTION 7. Representations and Warranties.

(A) Compliance With Agreement. The Company represents and warrants to CoBank that as of the date of this Agreement the Company and, to the extent contemplated hereunder, each Subsidiary (as defined in Section 10(D)(xix) below), is in compliance with all of the terms of this Agreement, and no Event of Default or Potential Default exists hereunder.

(B) Each Supplement. The execution by the Company of each Supplement hereto shall constitute a representation and warranty to CoBank that:

(i) Applications. Each representation and warranty and all information set forth in any application or other documents submitted in connection with, or to induce CoBank to enter into, such Supplement, is correct in all material respects as of the date of the Supplement.

(ii) Conflicting Agreements, Etc. This Agreement, the Supplements, and all security and other instruments and documents relating hereto and thereto (collectively, at any time, the “Loan Documents”), do not conflict with, or require the consent of any party to, any other Agreement to which the Company is a party or by which it or its property may be bound or affected, and do not conflict with any provision of the Company’s bylaws, articles of incorporation, or other organizational documents.

(iii) Compliance. The Company and, to the extent contemplated hereunder, each Subsidiary, is in compliance with all of the terms of the Loan Documents (including, without limitation, Section 8(A) of this Agreement on eligibility to borrow from CoBank).

(iv) Binding Agreement. The Loan Documents create legal, valid, and binding obligations of the Company that are enforceable in accordance with their terms, except to the extent that enforcement may be limited by applicable bankruptcy, insolvency, or similar laws affecting creditors’ rights generally.

SECTION 8. Affirmative Covenants. Unless otherwise agreed to in writing by CoBank, while this Agreement is in effect, the Company agrees to, and with respect to Subsections 8(B) through 8(G) and 8(H)(v)-(ix) hereof, agrees to cause each Subsidiary to:

(A) Eligibility. Maintain its status as an entity eligible to borrow from CoBank.

(B) Corporate Existence, Licenses. Etc. (i) Preserve and keep in full force and effect its existence and good standing in the jurisdiction of its incorporation or formation; (ii) qualify and remain qualified to transact business in all jurisdictions where such qualification is required; and (iii) obtain and maintain all licenses, certificates, permits, authorizations, approvals, and the like which are material to the conduct of its business or required by law, rule, regulation, ordinance, code, order, and the like (collectively, “Laws”).

(C) Compliance with Laws. Comply in all material respects with all applicable Laws, including, without limitation, all Laws relating to environmental protection and any patron or member investment program that it may have. In addition, the Company agrees to cause all Persons occupying or present on any of its properties, and to cause each Subsidiary to cause all Persons occupying or present on any of its properties, to comply in all material respects with all environmental protection Laws.

(D) Insurance. Maintain insurance with insurance companies or associations acceptable to CoBank in such amounts and covering such risks as are usually carried by companies engaged in the same or similar business and similarly situated, and make such increases in the type or amount of coverage as CoBank may request. All such policies insuring any collateral for the Company’s obligations to CoBank shall have mortgagee or lender loss payable clauses or endorsements in form and content acceptable to CoBank. At CoBank’s request, all policies (or such other proof of compliance with this Subsection as may be satisfactory to CoBank) shall be delivered to CoBank.

(E) Property Maintenance. Maintain all of its property that is necessary to or useful in the proper conduct of its business in good working condition, ordinary wear and tear excepted.

(F) Books and Records. Keep adequate records and books of account in which complete entries will be made in accordance with generally accepted accounting principles (“GAAP”) consistently applied.

(G) Inspection. Permit CoBank or its agents, upon reasonable notice and during normal business hours or at such other times as the parties may agree, to examine its properties, books, and records, and to discuss its affairs, finances, and accounts, with its respective officers, directors, employees, and independent certified public accountants.

(H) Reports and Notices. Furnish to CoBank:

(i) Annual Financial Statements. As soon as available, but in no event more than 120 days after the end of each fiscal year of the Company occurring during the term hereof, annual financial statements of the Company and its consolidated Subsidiaries, if any, prepared in accordance with GAAP consistently applied. Such financial statements shall: (a) be audited by independent certified public accountants selected by the Company and acceptable to CoBank; (b) be accompanied by a report of such accountants containing an opinion thereon acceptable to CoBank; (c) be prepared in reasonable detail and in comparative form; and (d) include a balance sheet, a statement of income, a statement of retained earnings, a statement of cash flows, and all notes and schedules relating thereto.

(ii) Interim Financial Statements. As soon as available after the end of each quarter, but in no event more than 5 days after the Company’s quarterly filing with the Securities Exchange Commission, a balance sheet of the Company and its consolidated Subsidiaries, if any, as of the end of such fiscal quarter, a statement of income for the Company and its consolidated Subsidiaries, if any, for such period and for the period year to date, and such other interim statements as CoBank may specifically request, all prepared in reasonable detail and in comparative form in accordance with GAAP consistently applied.

(iii) Annual Budgets. As soon as available, but in no event more than 60 days after the end of any fiscal year of the Company occurring during the term hereof, copies of the Company’s annual budgets and forecasts of operations.

(iv) Capital Expenditures Budget: The Company will furnish an annual capital expenditure budget, within 60 days after the end of each fiscal year. The Company will also furnish a revised budget if increases over the original capital expenditure budget are approved by the board of directors.

(v) Notice of Default. Promptly after becoming aware thereof, notice of the occurrence of an Event of Default or a Potential Default.

(vi) Notice of Non-Environmental Litigation. Promptly after the commencement thereof, notice of the commencement of all actions, suits, or proceedings before any court, arbitrator, or governmental department, commission, board, bureau, agency, or instrumentality affecting the Company or any Subsidiary which, if determined adversely to the Company or any such Subsidiary, could have a material adverse effect on the financial condition, properties, profits, or operations of the Company or any such Subsidiary.

(vii) Notice of Environmental Litigation, Etc. Promptly after receipt thereof, notice of the receipt of all pleadings, orders, complaints, indictments, or any other communication alleging a condition that may require the Company or any Subsidiary to undertake or to contribute to a cleanup or other response under environmental Laws, or which seek penalties, damages, injunctive relief, or criminal sanctions related to alleged violations of such Laws, or which claim personal injury or property damage to any person as a result of environmental factors or conditions. Notwithstanding the preceding sentence, notice shall be required only if costs, damages and/or penalties associated with an alleged condition or violation of Law exceed or are expected to exceed $7,500,000.00 or if any criminal activity is alleged.

(viii) Bylaws and Articles. Promptly after any change in the Company’s bylaws or articles of incorporation (or like documents), copies of all such changes, certified by the Company’s Secretary.

(ix) Other Information. Such other information regarding the condition or operations, financial or otherwise, of the Company or any Subsidiary as CoBank may from time to time reasonably request, including but not limited to copies of all pleadings, notices, and communications referred to in Subsections 8(H)(vi) and (vii) above.

(x) Officer Certificate. A quarterly officers certificate within 45 days of each fiscal quarter end, in a form acceptable to CoBank, certified by an officer of the Company, that measures compliance with Minimum Net Working Capital; Interest Coverage Ratio and Long Term Debt to Capitalization. (Section 10 (A) & (B) & (C)).

(I) Grower Agreements. The Company shall abide by the terms and conditions of its member grower agreements; make no material amendments or changes to the agreements without the written consent of the Bank; and extend the agreements for an additional five years when the current contracts expire.

(J) Crystech, L.L.C. (“Crystech”). Cause to be furnished to CoBank:

(i) Annual Financial Statements. As soon as available, but in no event more than 120 days after the end of each fiscal year of Crystech occurring during the term hereof, annual financial statements of Crystech prepared in accordance with GAAP consistently applied. Such financial statements shall: (a) be audited by independent certified public accountants selected by Crystech and acceptable to CoBank; (b) be accompanied by a report of such accountants containing an opinion thereon acceptable to CoBank; (c) be prepared in reasonable detail and in comparative form; and (d) include a balance sheet, a statement of income, a statement of retained earnings, a statement of cash flows, and all notes and schedules relating thereto.

(ii) Interim Financial Statements. As soon as available, but in no event more than 60 days after the end of each quarter, a balance sheet of Crystech as of the end of such fiscal quarter, a statement of income for Crystech for such period and for the period year to date, and such other interim statements as CoBank may specifically request, all prepared in reasonable detail and in comparative form in accordance with GAAP consistently applied.

(iii) Examinations. Such examination of Crystech’s books and records as CoBank may reasonably request.

SECTION 9. Negative Covenants.

(A) Unless otherwise agreed to in writing by CoBank, while this Agreement is in effect, the Company shall not, and shall not permit its Subsidiaries to:

(i) Borrowings. Create, incur, assume, or allow to exist, directly or indirectly, any indebtedness or liability for borrowed money (including trade or bankers’ acceptances), letters of credit, or the deferred purchase price of property or services (including capitalized leases), except for: (a) debt to CoBank; (b) accounts payable to trade creditors incurred in the ordinary course of business; (c) current operating liabilities (other than for borrowed money) incurred in the ordinary course of business; (d) indebtedness incurred in connection with the $20,000,000 Senior Secured Guaranteed Notes issued pursuant to the 2002 Note Purchase Agreement between the Company and the note purchasers named therein; (e) indebtedness incurred in connection with the $50,000,000 Senior Secured Guaranteed Notes issued pursuant to the 1998 Note Purchase Agreement between the Company and the note purchasers named therein (with the 2002 Note Purchase Agreement and the 1998 Note Purchase Agreement referred to collectively as the “Note Purchase Agreements”); (f) intercompany debt between the Company and its wholly owned Subsidiary, Xxxxxx Sugars Incorporated (“Sidney”), in amounts not to exceed an aggregate of $60,000,000.00 at any one time for the purpose of meeting Sidney’s working capital needs; and (g) permitted borrowings identified on Attachment A.

(ii) Liens. Create, incur, assume, or allow to exist any mortgage, deed of trust, pledge, lien (including the lien of an attachment, judgment, or execution), security interest, or other encumbrance of any kind upon any of its property, real or personal (collectively, “Liens”). The foregoing restrictions shall not apply to: (a) Liens in favor of CoBank; (b) Liens for taxes, assessments, or governmental charges that are not past due; (c) Liens and deposits under workers’ compensation, unemployment insurance, and social security Laws; (d) Liens and deposits to secure the performance of bids, tenders, contracts (other than contracts for the payment of money), and like obligations arising in the

ordinary course of business as conducted on the date hereof; (e) Liens imposed by Law in favor of mechanics, materialmen, warehousemen, and like persons that secure obligations that are not past due or that are being contested in good faith by the Company or Subsidiary, as applicable; (f) Liens created in connection with the Note Purchase Agreements described in subsection 9(A)(i) above (provided that said Liens shall be shared with CoBank in a manner acceptable to CoBank); and (g) easements, rights-of-way, restrictions, and other similar encumbrances which, in the aggregate, do not materially interfere with the occupation, use, and enjoyment of the property or assets encumbered thereby in the normal course of its business or materially impair the value of the property subject thereto except for the permitted Liens identified on Attachment B, without the prior written consent of the Bank. In addition, the Company agrees that it will not agree to a negative pledge with any other lender or third party.

(iii) Mergers, Acquisitions, Etc. Merge or consolidate with any other entity or acquire all or a material part of the assets of any person or entity, or, except upon advance written notice to CoBank, form or create any new subsidiary or affiliate, or commence operations under any other name, organization, or entity, including any joint venture; provided, however, the Company and any of its Subsidiaries can merge or consolidate with or into each other as long as the Company is the surviving entity.

(iv) Transfer of Assets. Sell, transfer, lease, or otherwise dispose of any of its assets, except in the ordinary course of business; provided however, the following shall not be prohibited: (a) the lease of sugar processing plants in Torrington, Wyoming and Hereford, Texas, to Western Sugar Cooperative and Imperial Sugar Company or a wholly-owned subsidiary of the Company, respectively; (b) the sale of the Hereford, Texas facility; and (c) the sale of excess real property associated with the Sidney, Montana facility.

(v) Loans. Lend or advance money, credit, or property to any person or entity, except for (a) trade credit extended in the ordinary course of business; (b) certain inter-company loans made pursuant to Intercompany Loan/Security Agreement dated August 31, 1997 and successor agreements; and (c) intercompany line of credit loans from the Company to Xxxxxx, in amounts not to exceed an aggregate of $60,000,000.00 at any one time for the purpose of meeting Sidney’s working capital needs.

(vi) Contingent Liabilities. Assume, guarantee, become liable as a surety, endorse, contingently agree to purchase, or otherwise be or become liable, directly or indirectly (including, but not limited to, by means of a maintenance agreement, an asset or stock purchase agreement, or any other agreement designed to ensure any creditor against loss), for or on account of the obligation of any person or entity, except by the endorsement of negotiable instruments for deposit or collection or similar transactions in the ordinary course of the Company’s or Subsidiaries’ business and except for (1) any liability on account of a Company guaranty of the indebtedness of Midwest Agri Commodities; and (2) any guarantees created in connection with the Note Purchase Agreements described in subsection 9(A)(i) above.

(vii) Change in Business. Engage in any business activities or operations substantially different from or unrelated to the Company’s present business activities or operations.

(B) Notwithstanding anything in this Section 9 to the contrary, the prohibitions set forth in this section shall apply only to any act or transaction by the Company, including any Subsidiary, deemed “material”. An act or transaction shall be deemed material only if the amount or value of the act or transaction exceeds $7,500,000.00. This materiality standard shall not apply to subsection (A)(ii), which

subsection shall apply without reference to the materiality of the Lien (but subject to exceptions noted therein), and subsection (A)(vii), which subsection shall apply without reference to the materiality of any business activities or operations substantially different from or unrelated to the Company’s or any Subsidiary’s present business activities or operations.

SECTION 10. Financial Covenants. Unless otherwise agreed to in writing, while this Agreement is in effect:

(A) Minimum Net Working Capital. The Company and its Subsidiaries, on a consolidated basis, shall have (1) at the end of each fiscal quarter, other than fiscal year end, an excess of current assets over current liabilities (both as determined in accordance with GAAP consistently applied) of not less than $15,000,000.00; and (2) at the end of each fiscal year, an excess of current assets over current liabilities (both as determined in accordance with GAAP consistently applied) of not less than $35,000,000.00.

(B) Long Term Debt to Capitalization. The Company and its Subsidiaries, on a consolidated basis, shall maintain at all times and measured as of the end of each Fiscal Quarter a ratio of Long Term Debt divided by the sum of Long Term Debt plus Equity of no greater than fifty-five percent (55%).

(C) Interest Coverage Ratio. The Company and its Subsidiaries, on a consolidated basis, shall maintain at all times, and measured as of the end of each Fiscal Quarter, a minimum ratio of Average Net Funds Generated plus Average Interest Expense to Average Interest Expense of 2.5:1

(D) Definitions. For purposes of this Section 10 and this Agreement, the following terms shall be defined as follows:

(i) Average Interest Expense shall mean the total interest expense of the Company and its Subsidiaries (including, without limitation, interest expense on capital leases and, to the extent not included therein, fees and other charges payable with respect to all Debt), all determined on a consolidated basis in accordance with GAAP, for the most recent twelve (12) Fiscal Quarters divided by four (4).

(ii) Average Net Funds Generated shall mean the sum of the following for the most recent twelve (12) Fiscal Quarters divided by four (4):

Add: Unit Retains; Depreciation and amortization; Net income from non-member business and member business tax timing differences; Decrease in investments in other cooperatives (excluding subsidiaries); and Net revenue from sale of stock.

Minus: Increase in investments in other cooperatives (excluding subsidiaries); Net loss from non-member business and member business tax timing differences; Provision for income tax; and Members’ investment retirements.

(iii) Borrowing Base shall mean a maximum dollar amount available to the Company under the terms of the Commitment (as set forth in a Supplement) as determined on the basis of the most recent Borrowing Base Certificate.

(iv) Borrowing Base Certificate shall mean a certification of the value of specified assets of the Company used in computing the Borrowing Base prepared in a form acceptable to CoBank.

(v) Capitalization shall mean the sum of Long Term Debt plus Equity as determined in accordance with GAAP.

(vi) Current Assets. The current assets of the Company and its Subsidiaries as measured in accordance with GAAP.

(vii) Current Liability shall mean the current liabilities of the Company and its Subsidiaries as measured in accordance with GAAP.

(viii) Depreciation shall mean total depreciation of the Company and its Subsidiaries as measured in accordance with GAAP.

(ix) Debt shall mean as to any Person: (a) indebtedness or liability of such Person for borrowed money, or for the deferred purchase price of property or services; (b) obligations of such Person as lessee under capital leases; (c) obligations of such Person arising under bankers’ or trade acceptance facilities; (d) all guarantees, endorsements (other than for collection or deposit in the ordinary course of business), and other contingent obligations of such Person to purchase any of the items included in this definition, to provide funds for payment, to supply funds to invest in any other Person, or otherwise to assure a creditor of another Person against loss; (e) all obligations secured by a lien on property owned by such Person, whether or not the obligations have been assumed; and (f) all obligations of such Person under any agreement providing for an interest rate swap, cap, cap and floor, contingent participation or other hedging mechanisms with respect to interest payable on any of the items described in this definition.

(x) Equity shall mean total equity of the Company and its Subsidiaries as measured in accordance with GAAP.

(xi) Fiscal Quarter shall mean each three (3) month period beginning on the first day of each of the following months: September, December, March and June.

(xii) Fiscal Year shall mean a year commencing on September 1 and ending on August 31.

(xiii) GAAP shall mean generally accepted accounting principles in effect from time to time.

(xiv) Interest Expense shall mean current cost of borrowing funds that is shown as a financial expense in the income statement and as measured in accordance with GAAP.

(xv) Long Term Debt shall mean long term debt (excluding current maturities) as determined in accordance with GAAP.

(xvi) Net Realizable Value shall mean the expected selling price of an inventory item less expected costs to complete and dispose, as determined in accordance with GAAP.

(xvii) Net Working Capital shall mean the Total Current Assets minus the Total Current Liabilities of the Company and its Subsidiaries as determined in accordance with GAAP accounting principles, consistently applied.

(xviii) Person shall mean any individual, sole proprietorship, partnership, joint venture, trust, unincorporated organization, association, corporation, limited liability company, cooperative association, institution, entity, party or government (whether national, federal, state, provincial, country, city, municipal or otherwise, including without limitation, and instrumentality, division, agency, body or department thereof).

(xix) Subsidiary shall mean with respect to any Person: (a) any corporation in which such Person, directly or indirectly, (i) owns more than fifty percent (50%) of the outstanding stock thereof, or (ii) has the power under ordinary circumstances to elect at least a majority of the directors thereof, or (b) any partnership, association, joint venture, limited liability company, or other unincorporated organization or entity with respect to which such Person, directly or indirectly, owns an equity interest in an amount sufficient to control the management thereof. For purposes of this Section 10 only, “Subsidiary” shall not include ProGold Limited Liability Company (“ProGold”) (but only for so long as ProGold’s current lease with Cargill remains in effect and in good standing) or Crystech.

SECTION 11. Events of Default. Each of the following shall constitute an “Event of Default” under this Agreement:

(A) Payment Default. The Company should fail to make any payment to, or to purchase any equity in, CoBank when due. Any payment received by CoBank after its due date shall not be subject to an increase in the interest rate, as provided for in Section 12 below, if the Company is not responsible for the payment delay.

(B) Representations and Warranties. Any representation or warranty made or deemed made by the Company herein or in any Supplement, application, agreement, certificate, or other document related to or furnished in connection with this Agreement or any Supplement, shall prove to have been false or misleading in any material respect on or as of the date made or deemed made.

(C) Certain Affirmative Covenants. The Company or, to the extent required hereunder, any Subsidiary should fail to perform or comply with Sections 8(A) through 8(H)(ii), 8(H)(viii), or any reporting covenant set forth in any Supplement hereto, and such failure continues for 15 days after written notice thereof shall have been delivered by CoBank to the Company.

(D) Other Covenants and Agreements. The Company or, to the extent required hereunder, any Subsidiary should fail to perform or comply with any other covenant or agreement contained herein or in any other Loan Document or shall use the proceeds of any loan for an unauthorized purpose.

(E) Cross-Default. The Company should, after any applicable grace period, breach or be in default under the terms of any other agreement between the Company and CoBank.

(F) Other Indebtedness. The Company or, to the extent required hereunder, any Subsidiary should fail to pay when due any indebtedness to any other person or entity for borrowed money or any long-term obligation for the deferred purchase price of property (including any capitalized lease), or any other event occurs which, under any agreement or instrument relating to such indebtedness or obligation,

has the effect of accelerating or permitting the acceleration of such indebtedness or obligation, whether or not such indebtedness or obligation is actually accelerated or the right to accelerate is conditioned on the giving of notice, the passage of time, or otherwise.

(G) Judgments. A judgment, decree, or order for the payment of money shall be rendered against the Company or any Subsidiary in an amount which, if enforced, would have a material adverse effect on the financial condition, profits or operations of the Company, or a Lien prohibited under Section 9(B) hereof shall have been obtained and shall continue in effect for a period of 20 consecutive days without being discharged, satisfied, or stayed pending appeal.

(H) Insolvency, Etc. The Company or any Subsidiary shall: (i) become insolvent or shall generally not, or shall be unable to, or shall admit in writing its inability to, pay its debts as they come due; or (ii) suspend its business operations or a material part thereof or make an assignment for the benefit of creditors; or (iii) apply for, consent to, or acquiesce in the appointment of a trustee, receiver, or other custodian for it or any of its property or, in the absence of such application, consent, or acquiescence, a trustee, receiver, or other custodian is so appointed; or (iv) commence or have commenced against it any proceeding under any bankruptcy, reorganization, arrangement, readjustment of debt, dissolution, or liquidation Law of any jurisdiction.

(I) Material Adverse Change. Any material adverse change occurs, as reasonably determined by CoBank, in the Company’s financial condition, results of operation, or ability to perform its obligations hereunder or under any instrument or document contemplated hereby.

(J) Guaranties. The Company’s agreement to guaranty, assume, or provide surety of other entities’ financial obligations shall not exceed an aggregate amount greater than 10% of the Company’s net worth, without the Bank’s prior written consent.

SECTION 12. Remedies.

(A) Rights. Upon the occurrence and during the continuance of an Event of Default or any Potential Default, CoBank shall have no obligation to continue to extend credit to the Company and may discontinue doing so at any time without prior notice. CoBank shall promptly notify the Company subsequent to any action to discontinue extending credit to the Company. In addition, upon the occurrence and during the continuance of any Event of Default, CoBank may, upon notice to the Company, terminate any commitment and declare the entire unpaid principal balance of the loans, all accrued interest thereon, and all other amounts payable under this Agreement, all Supplements, and the other Loan Documents to be immediately due and payable. Upon such a declaration, the unpaid principal balance of the loans and all such other amounts shall become immediately due and payable, without protest, presentment, demand, or further notice of any kind, all of which are hereby expressly waived by the Company. In addition, upon such an acceleration:

(i) Enforcement. CoBank may proceed to protect, exercise, and enforce such rights and remedies as may be provided by this Agreement, any other Loan Document or under Law. Each and every one of such rights and remedies shall be cumulative and may be exercised from time to time, and no failure on the part of CoBank to exercise, and no delay in exercising, any right or remedy shall operate as a waiver thereof, and no single or partial exercise of any right or remedy shall preclude any other or future exercise thereof, or the exercise of any other right. Without limiting the foregoing, CoBank may hold

and/or set off and apply against the Company’s obligations to CoBank the proceeds of any equity in CoBank, any cash collateral held by CoBank, or any balances held by CoBank for the Company’s account (whether or not such balances are then due).

(ii) Application of Funds. CoBank may apply all payments received by it to the Company’s obligations to CoBank in such order and manner as CoBank may elect in its sole discretion.

(B) Default Interest Rate. In addition to the rights and remedies set forth above: (i) if the Company fails to purchase any equity in CoBank when required or fails to make any payment to CoBank when due, then at CoBank’s option in each instance, such payment shall bear interest from the date due to the date paid at 4% per annum in excess of the rate(s) of interest that would otherwise be in effect on that loan; and (ii) after the maturity of any loan (whether as a result of acceleration or otherwise), the unpaid principal balance of such loan (including without limitation, principal, interest, fees and expenses) shall automatically bear interest at 4% per annum in excess of the rate(s) of interest that would otherwise be in effect on that loan. All interest provided for herein shall be payable on demand and shall be calculated on the basis of a year consisting of 360 days.

SECTION 13. Broken Funding Surcharge. Notwithstanding any provision contained in any Supplement giving the Company the right to repay any loan prior to the date it would otherwise be due and payable, the Company agrees to provide three Business Days’ prior written notice for any prepayment of a fixed rate balance and that in the event it repays any fixed rate balance prior to its scheduled due date or prior to the last day of the fixed rate period applicable thereto (whether such payment is made voluntarily, as a result of an acceleration, or otherwise), the Company will pay to CoBank a surcharge in an amount which would result in CoBank being made whole (on a present value basis) for the actual or imputed funding losses incurred by CoBank as a result thereof Notwithstanding the foregoing, in the event any fixed rate balance is repaid as a result of the Company refinancing the loan with another lender or by other means, then in lieu of the foregoing, the Company shall pay to CoBank a surcharge in an amount sufficient (on a present value basis) to enable CoBank to maintain the yield it would have earned during the fixed rate period on the amount repaid. Such surcharges will be calculated in accordance with methodology established by CoBank (a copy of which will be made available to the Company upon request).

SECTION 14. Complete Agreement, Amendments. This Agreement, all Supplements, and all other instruments and documents contemplated hereby and thereby, are intended by the parties to be a complete and final expression of their agreement. No amendment, modification, or waiver of any provision hereof or thereof, and no consent to any departure by the Company herefrom or therefrom, shall be effective unless approved by CoBank and contained in a writing signed by or on behalf of CoBank, and then such waiver or consent shall be effective only in the specific instance and for the specific purpose for which given. In the event this Agreement is amended or restated, each such amendment or restatement shall be applicable to all Supplements hereto.

SECTION 15. Other Types of Credit. From time to time, CoBank may issue letters of credit or extend other types of credit to or for the account of the Company. In the event the parties desire to do so under the terms of this Agreement, such extensions of credit may be set forth in any Supplement hereto and this Agreement shall be applicable thereto.

SECTION 16. Applicable Law. Except to the extent governed by applicable federal law, this Agreement and each Supplement shall be governed by and construed in accordance with the laws of the State of Colorado, without reference to choice of law doctrine.

SECTION 17. Notices. All notices hereunder shall be in writing and shall be deemed to be duly given upon delivery if personally delivered or sent by telegram or facsimile transmission, or 3 days after mailing if sent by express, certified or registered mail, to the parties at the following addresses (or such other address for a party as shall be specified by like notice):

If to CoBank as follows:	If to the Company, as follows:
CoBank, ACB	American Crystal Sugar Company
Corporate Finance	ATTN: Treasurer
X.X. Xxx 0000	000 Xxxxx 0^xx Xxxxxx, Xxxxxxxx, Xxxxxxxxx 00000
Xxxxxx, Xxxxxxxx 00000 – Fax # (000) 000-0000	FAX#: (000) 000-0000

SECTION 18. Taxes and Expenses. To the extent allowed by law, the Company agrees to pay all reasonable out-of-pocket costs and expenses (including the fees and expenses of counsel retained by CoBank) incurred by CoBank in connection with the origination, administration, collection, and enforcement of this Agreement and the other Loan Documents, including, without limitation, all costs and expenses incurred in perfecting, maintaining, determining the priority of, and releasing any security for the Company’s obligations to CoBank, and any stamp, intangible, transfer, or like tax payable in connection with this Agreement or any other Loan Document.

SECTION 19. Effectiveness and Severability. This Agreement shall continue in effect until: (i) all indebtedness and obligations of the Company under this Agreement, all Supplements, and all other Loan Documents shall have been paid or satisfied; (ii) CoBank has no commitment to extend credit to or for the account of the Company under any Supplement; and (iii) either party sends written notice to the other terminating this Agreement. Any provision of this Agreement or any other Loan Document which is prohibited or unenforceable in any jurisdiction shall, as to such jurisdiction, be ineffective to the extent of such prohibition or unenforceability without invalidating the remaining provisions hereof or thereof.

SECTION 20. Successors and Assigns. This Agreement, each Supplement, and the other Loan Documents shall be binding upon and inure to the benefit of the Company and CoBank and their respective successors and assigns, except that the Company may not assign or transfer its rights or obligations under this Agreement, any Supplement or any other Loan Document without the prior written consent of CoBank.

SECTION 21. Participations. From time to time, CoBank may sell to one or more banks, financial institutions or other lenders a participation in one or more of the loans or other extensions of credit made pursuant to this agreement. However, no such participation shall relieve CoBank of any commitment made to the Company under any Supplement hereto. In connection with the foregoing, CoBank may disclose information concerning the Company and its Subsidiaries to any participant or prospective participant, provided that such participant or prospective participant agrees to keep such information confidential. CoBank agrees that all Loans that are made by CoBank and that are retained for its own

account and are not included in a sale of participation interest shall be entitled to patronage distributions in accordance with the bylaws of CoBank and its practices and procedures related to patronage distribution. Accordingly, all Loans that are included in a sale of participation interest shall not be entitled to patronage distributions. A sale of participation interest may include certain voting rights of the participants regarding the loans hereunder (including without limitation the administration, servicing and enforcement thereof). CoBank agrees to give written notification to the Company of any sale of participation interests.

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed by their duly authorized officers as of the date shown above.

CoBANK, ACB		AMERICAN CRYSTAL SUGAR COMPANY

By	/s/ Xxxxxxx Xxxxxxxxxx	By:	/s/ Xxx Xxx

Title	Vice President	Title:	TREASURER

				7/30/03
				[ILLEGIBLE]

Attachment “A”

AMERICAN CRYSTAL SUGAR COMPANY (ACSC)

AND SUBSIDIARIES

Permitted Borrowings

Lender		Amount

Commercial Paper		Variable Maximum Outstanding: $225 million

Minn-Dak Farmers Cooperative		Variable
Southern Minnesota Beet Sugar Cooperative
United States Sugar Corporation

Private Placement of Debt
Xxxx Xxxxxxx Mutual Life Insurance Co.		$26 million
Xxxx Xxxxxxx Variable Life Insurance Co.		$1.5 million
Xxxx Xxxxxx Life Insurance Company		$22.5 million
Xxxx Xxxxxxx Ins. Co.		$20 million

Xxxxx Fargo		$1 million

Commodity Credit Corporation		Variable

East Grand Forks Pollution Control Refunding Series A		$4,090,000

East Grand Forks Industrial Development Series B		$915,000

1996 Traill County Series A, B & C Bonds		$18 million

1997 City of Xxxxxxxx Bonds		$5.5 million

1998 Traill County Bonds		$5.75 million

1999 Traill County Bonds		$3.58million

2000 City of East Grand Forks Bonds		$5.75 million

Intercompany Loan(s) from ACSC to Xxxxxx Sugars Incorporated		$60 million

Attachment “B”

AMERICAN CRYSTAL SUGAR COMPANY (ACSC)

AND SUBSIDIARIES

Permitted Liens

Asset		Lien Holder

Sugar		Commodity Credit Corporation

Real Estate, Equipment, Intangibles		CoBank as Collateral Agent

ACSC’s Equity in Crystech, LLC		First Union Trust Company, National Association, as Collateral Agent

Pollution control Equipment located at ACSC’s Xxxxxxxxx, MN Facility		Security Agreement American National Bank and Trust Company (now known as Firstar Bank)

Industrial Development Revenue Bond		Security Agreement
Equipment Located at ACSC’s Moorhead, MN Facility		Xxxxx Fargo (successor to Firstar Bank)

Marketing Assets		Minn-Dak Farmers Cooperative
		Southern Minnesota Beet Sugar Cooperative
		United States Sugar Corporation

Fixed Assets – Collateral Pool		Private Placement of Debt
		Xxxx Xxxxxxx Mutual Life Insurance Co.
		Xxxx Xxxxxxx Variable Life Insurance Co.
		Xxxx Xxxxxx Life Insurance Co.

CoBANK, ACB

COMPLIANCE CERTIFICATE – CERTIFIED INTERIM FINANCIALS

This certificate is being furnished to CoBANK, ACB (“CoBank”) to induce CoBank to make and/or continue to make advances to the Company and to comply with and demonstrate compliance with the terms, covenants, and conditions of the Company’s Master Loan Agreement and all Promissory Note and Supplements thereto. The undersigned hereby certifies that: (i) this certificate was prepared from the books and records of the Company, is in agreement with them, and is correct to the best of the undersigned’s knowledge and belief; (ii) no “Event of Default” (as defined in the Master Loan Agreement) or event which, with the giving of notice and/or the passage of time and/or the occurrence of any other condition, would ripen into an Event of Default (a “Potential Default”) shall have occurred and be continuing, except as disclosed below; and (iii) based upon the undersigned’s review of the attached interim financial statement(s) dated as of , to the best of the undersigned’s knowledge, the attached financial statement(s) are accurate and complete for the period reflected.

This certificate is attached to and made a part of the Company’s interim financial statements for the reporting period ending .

	Required	Actual
Net Working Capital
1. Current Assets as measured in accordance with GAAP 2. Current Liabilities as measured in accordance with GAAP 3. Net Working Capital (1. minus 2.)	Minimum Net Working Capital required for fiscal quarters other than fiscal year end = $15,000,000 Minimum Net Working Capital required for fiscal year end = $35,000,000	1. 2. 3.

Interest Coverage Ratio
1. Average Net Funds Generated which is the sum of the following for the most recent 12 Fiscal Quarters divided by 4. • Add: Unit Retains; Depreciation and amortization; Net income from non-member business and Member business tax timing differences; Decrease in investments in other cooperatives (excluding subsidiaries); and Net revenue from sale of stock. • Minus: Increase in investments in other cooperatives (excluding subsidiaries); Net loss from non-member business and member business tax timing differences; Provision for income tax; and Members’ investment retirements. 2. Average Interest Expense defined as the total interest expense of the Company and its Subsidiaries (including, without limitation, interest expense on capital leases) and fees and other charges payable with respect to all Debt, all determined on a consolidated basis in accordance with GAAP for the most recent 12-Fiscal Quarters divided by 4. 3. Interest Coverage Ratio (Sum of 1. and 2., divided by 2.)	Maintain at all times, and measured as of the end of each Fiscal Quarter, a minimum ratio of Average Net Funds Generated plus Average Interest Expense to Average Interest Expense of at least 2.5:1.0.	1. 2. 3.

	Required	Actual
Long Term Debt to Capitalization
1. Long Term Debt (excluding current maturities) calculated in accordance with GAAP 2. The sum of Long Term Debt plus Equity as determined in accordance with GAAP 3. Long Term Debt to Capitalization (1. divided by 2.)	Maintain at all times and measured as of the end of each Fiscal Quarter the ratio of Long Term Debt divided by the sum of Long Term Debt plus Equity of no greater than fifty-five percent (55%).	1. 2. 3.

*Note: For purposes of this calculation the long term debt and equity associated with the consolidation of Pro Gold LLC are to be excluded.*

Leverage Ratio (and Term Performance Pricing)
1. Long Term Debt (excluding current maturities) calculated in accordance with GAAP 2. Plus or minus the difference between actual working capital and $35,000,000 3. Total members investments 4. Estimated unit retains 5. Leverage Ratio (The sum of 1. plus or minus 2. divided by the sum of 3. plus 4.)	Maintain a leverage ratio of not more than 1.50:1.0	1. 2. 3. 4. 5. Based upon the previous fiscal quarter’s Leverage Ratio, the Company is entitled to the following change in the LIBOR and TREASURY Margins:

The above calculations and ratios are to be determined on a consolidated basis in accordance with Section 10 of the Master Loan Agreement (which excludes the financial results of ProGold and Crystech from such calculations and ratios).

	AMERICAN CRYSTAL SUGAR COMPANY
	(“Company”)


	Authorized Signature


	Title


	Date

Loan No. Z269T01D

REVOLVING TERM LOAN SUPPLEMENT

THIS SUPPLEMENT to the Amended and Restated Master Loan Agreement dated July 21, 2003 the (“MLA”), is entered into as of July 21, 2003, between CoBANK, ACB (“CoBank”) and AMERICAN CRYSTAL SUGAR COMPANY, Moorhead, Minnesota (the “Company”), and amends and restates the Supplement dated November 6, 2002 and numbered Z269T01C.

SECTION 1. The Revolving Term Loan Commitment. On the terms and conditions set forth in the MLA and this Supplement, CoBank agrees to make loans to the Company during the period set forth below in an aggregate principal amount not to exceed $58,276,702.22 at any one time outstanding (the “Commitment”). Within the limits of the Commitment, the Company may borrow, repay and reborrow.

SECTION 2. Purpose. The purpose of the Commitment is to finance the operating needs of the Company.

SECTION 3. Term. The term of the Commitment shall be from the date hereof, up to and including August 1, 2004, or such later date as CoBank may, in its sole discretion, authorize in writing.

SECTION 4. Interest. The Company agrees to pay interest on the unpaid balance of the loans in accordance with one or more of the following interest rate options, as selected by the Company:

(A) CoBank Base Rate. At a rate per annum equal at all times to the rate of interest established by CoBank from time to time as its CoBank Base Rate, which Rate is intended by CoBank to be a reference rate and not its lowest rate. The CoBank Base Rate will change on the date established by CoBank as the effective date of any change therein and CoBank agrees to notify the Company of any such change.

(B) Quoted Rate. At a fixed rate per annum to be quoted by CoBank in its sole discretion in each instance. Under this option, rates may be fixed on such balances and for such periods, as may be agreeable to CoBank in its sole discretion in each instance, provided that: (1) the maximum fixed period shall be 1 day; and (2) the minimum amount that may be fixed each time shall be $2,000,000.00.

(C) LIBOR Option. At a fixed rate equal to “LIBOR” (as hereinafter defined) plus 90 basis points per annum (the “LIBOR” Spread). Under this option: (a) rates may be fixed for “Interest Periods” (as hereinafter defined) of 1, 2, 3, or 6 months, or 1 year, as selected by the Company; (b) the minimum amount that may be fixed at any one time shall be $2,000,000.00; and (c) rates may only be fixed on a “Banking Day” (as hereinafter defined) or, at the option of the Company, on 3 Banking Days’ prior notice. For purposes hereof: (i) “LIBOR” shall mean the rate (rounded upward to the nearest sixteenth and adjusted for reserves required on “Eurocurrency Liabilities” (as hereinafter defined) for banks subject to “FRB Regulation D” (as hereinafter defined) or required by any other federal law or regulation) quoted by the British Bankers Association (the “BBA”) at 11:00 a.m. London time two Banking Days before the commencement of the Interest Period for the offering of U.S. dollar deposits in the London interbank market for the Interest Period designated by the Company; (ii) “Banking Day” shall mean a day on which CoBank is open for business, dealings in U.S. dollar deposits are being carried out in the London interbank market, and banks are open for business in New York City and London, England; and (iii) “Interest Period” shall mean a period commencing on the day the Company elects to fix a rate under this option and ending on the numerically corresponding day in the next calendar month or the month that is 2, 3, or 6 months or 1 year thereafter, as the case may be; provided, however, that: (x) in the event such

ending day is not a Banking Day, such period shall be extended to the next Banking Day unless such next Banking Day falls in the next calendar month, in which case it shall end on the preceding Banking Day; and (y) if there is no numerically corresponding day in the month, then such period shall end on the last Banking Day in the relevant month; and (v) “FRB Regulation D” shall mean Regulation D as promulgated by the Board of Governors of the Federal Reserve System, 12 CFR Part 204, as amended.

(D) Treasury Option. At a fixed rate equal to Applicable Treasury Margin per annum (as described in terms of basis points (“bps”) in the chart immediately set forth below) above the “U.S. Treasury Rate” (as hereinafter defined). Under this option, balances of $2,000,000.00 or more may be fixed on or before for periods ranging from two years to the final maturity date of the loan, as selected by the Company. However, rates may not be fixed in such a manner as to require the Company to have to repay any fixed rate balance prior to the last day of its fixed rate period in order to pay any installment of principal. For purposes hereof, the “U.S. Treasury Rate” shall mean the yield to maturity on U.S. Treasury instruments having the same maturity date as the last day of the fixed rate period selected by the Company, as calculated from the bid price indicated by Telerate (page 5) at the time the rate is fixed. If, however, no instrument is indicated for the maturity selected, then the rate shall be interpolated based on the bid prices quoted for the next longest and shortest maturities so indicated. In the event Telerate ceases to provide such quotations or materially changes the form or substance of page 5 (as determined by CoBank), then CoBank will notify the Company and the parties hereto will agree upon a substitute basis for obtaining such quotations

TREASURY MARGINS

FIXED RATE PRODUCT	INDEX	SPREAD OVER INDEX IN BASIS POINTS (Applicable Treasury Margin)
Two Years	U.S.$ Constant Maturity Treasury Rate (“US$CMT”)	125 bps
Three Years	US$CMT	125 bps
Four Years	US$CMT	125 bps
Five Years	US$CMT	125 bps
Seven Years	US$CMT	140 bps
Ten Years	US$CMT	140 bps
Floor (Minimum) Rate (For Two to Ten Year Fixed Rate Products Only)	CoBank’s cost of funds (as reasonably determined by CoBank in its sole discretion)	105bps

The spread over all of the above indices, including the Floor (Minimum) Rate, may increase or decrease for future fixed amounts based on the Company’s previous fiscal quarter’s leverage ratio, as follows:

LEVERAGE RATIO (as defined below)	INCREASE/DECREASE TO SPREAD	CHANGE TO APPLICABLE LIBOR and TREASURY MARGINS (IN BASIS POINTS)
A. Equal to or greater than 1.35:1.00	Increase	20
B. Equal to or greater than 1.20:1.00, but less than 1.35:1.00	None	0
C. Less than 1.20:1.00, but greater than or equal to 1.00:1.00	Decrease	10
D. Less than 1.00:1.00	Decrease	20

Leverage Ratio: The Company will maintain a leverage ratio of not more than 1.50:1.0. Leverage ratio is long term (excluding current maturities) calculated in accordance with GAAP plus or minus the difference between actual working capital and Minimum Net Working Capital (as defined in the MLA No. Z269, Section 10, as it may be amended), divided by total members investments plus the estimated unit retains.

Changes to the Applicable LIBOR or Treasury Margin shall be made quarterly on the latter of either: (a) five business days after the Bank’s receipt of the Company’s certification of compliance with the leverage ratio, or (b) 30 days after the end of each calendar quarter. If the Company fails to timely furnish to CoBank the compliance certificate as required to be delivered pursuant to the MLA, then the change to the Applicable LIBOR and Treasury Margin shall be an increase of the highest permitted under the above chart.

The Company shall select the applicable rate option at the time it requests a loan hereunder and may, subject to the limitations set forth above, elect to convert balances bearing interest at the variable rate option to one of the fixed rate options. Upon the expiration of any fixed rate period, interest shall automatically accrue at the variable rate option unless the amount fixed is repaid or fixed for an additional period in accordance with the terms hereof. Notwithstanding the foregoing, unless CoBank otherwise consents in its sole discretion in each instance, rates may not be fixed for periods expiring after the maturity date of the loans. In the event CoBank so consents and the Commitment is not renewed, then each balance so fixed shall be due and payable on the last day of its fixed rate period, and the promissory note set forth below shall be deemed amended accordingly. All elections provided for herein shall be made telephonically or in writing and must be received by 12:00 noon Company’s local time. Interest shall be calculated on the actual number of days each loan is outstanding on the basis of a year consisting of 360 days and shall be payable quarterly in arrears by the 20th day of the following month.

SECTION 5. Promissory Note. The Company promises to repay the loans that are outstanding in 6 equal, consecutive annual principal payments of $9,396,579.17 with the first such payment due on or before December 31, 2004, and a final principal payment due in an amount equal to the remaining unpaid principal balance on or before December 31, 2010. If any installment due date is not a day on which CoBank is open for business, then such payment shall be made on the next day on

which CoBank is open for business. In addition to the above, the Company promises to pay interest on the unpaid principal balance hereof at the times and in accordance with the provisions set forth in Section 4 hereof. This note replaces and supersedes, but does not constitute payment of the indebtedness evidenced by, the promissory note set forth in the Supplement being amended and restated hereby.

The Company shall be permitted to make special payments, in a minimum amount of $388,500.00 on the variable rate portion of this loan, when all short term financing, including the Company’s seasonal loans, Commodity Credit Corporation loans and other short term loans have been zeroed out. These special payments may be readvanced through the expiration date of the Commitment. Reinstatement may be denied and canceled at any time at the option of CoBank. The reinstatable commitments arising from such special payments shall be subject to the Commitment Fee as described in Section 8 below.

SECTION 6. Prepayment. Subject to Section 13 of the MLA, the loans may be prepaid in whole or in part on one CoBank business day’s prior written notice. During the term of the Commitment, prepayments shall be applied to such balances, fixed or variable, as the Company shall specify. After the expiration of the term of the Commitment, prepayments shall, unless CoBank otherwise agrees, be applied to principal installments in the inverse order of their maturity and to such balances, fixed or variable, as CoBank shall specify.

SECTION 7. Commitment Fee. In consideration of the Commitment, the Company agrees to pay to CoBank a commitment fee on the average daily unused portion of the Commitment at the rate of 20 basis points per annum (calculated on a 360 day basis), payable quarterly in arrears by the 20th day following each calendar quarter. Such fee shall be payable for each quarter (or portion thereof) occurring during the original or any extended term of the Commitment.

SECTION 8. Commitments Arising From Special Payments. Commitments arising as a result of special payments described in Section 5 above shall be subject to a commitment fee of 25 basis points (0.25%) on an annualized basis, on the average daily unused commitment. Any such fees incurred shall be payable on the last day of the calendar quarter, in arrears, computed on the basis of a year of 360 days for the actual number of days elapsed in which such reinstatable commitments were outstanding.

SECTION 9. Security. In addition to any other security that may otherwise be required or provided, the Company’s obligations to CoBank under this Supplement are secured by that Restated Mortgage and Security Agreement dated September 15, 1998, from American Crystal Sugar Company to St. Xxxx Bank for Cooperatives (now known as CoBank as a result of merger), as Collateral Agent, as amended on January 31, 2003 by that certain Modification Agreement to the Amended and Restated Mortgage and Security Agreement.

SECTION 10. Amendment Fee. In consideration of the amendment, the Company agrees to pay to CoBank on the execution hereof a fee in the amount of $9,396.58.

IN WITNESS WHEREOF, the parties have caused this Supplement to be executed by their duly authorized officers as of the date shown above.

CoBANK, ACB		AMERICAN CRYSTAL SUGAR COMPANY


By:	/s/ Xxxxxxx Xxxxxxxxxx	By:	/s/ Xxx Xxx

Title:	Vice President	Title:	TREASURER

				7-30-03
				[ILLEGIBLE]

Loan No. Z269T01DNP

REVOLVING TERM LOAN SUPPLEMENT

THIS SUPPLEMENT to the Amended and Restated Master Loan Agreement dated July 21, 2003 (the “MLA”), is entered into as of July 21, 2003, between CoBANK, ACB (“CoBank”) and AMERICAN CRYSTAL SUGAR COMPANY, Moorhead, Minnesota (the “Company”), and amends and restates the Supplement dated November 6, 2002 and numbered Z269T01CNP.

SECTION 1. The Revolving Term Loan Commitment. On the terms and conditions set forth in the MLA and this Supplement, CoBank agrees to make loans to the Company during the period set forth below in an aggregate principal amount not to exceed $49,079,855.68 at any one time outstanding (the “Commitment”). Within the limits of the Commitment, the Company may borrow, repay and reborrow.

SECTION 2. Purpose. The purpose of the Commitment is to finance the operating needs of the Company.

SECTION 3. Term. The term of the Commitment shall be from the date hereof, up to and including August 1, 2004, or such later date as CoBank may, in its sole discretion, authorize in writing.

SECTION 4. Interest. The Company agrees to pay interest on the unpaid balance of the loans in accordance with one or more of the following interest rate options, as selected by the Company:

(C) LIBOR Option. At a fixed rate equal to “LIBOR” (as hereinafter defined) plus 90 basis points per annum (the “LIBOR Spread”). Under this option: (a) rates may be fixed for “Interest Periods” (as hereinafter defined) of 1, 2, 3 or 6 months, or 1 year, as selected by the Company; (b) the minimum amount that may be fixed at any one time shall be $2,000,000.00; and (c) rates may only be fixed on a “Banking Day” (as hereinafter defined) or, at the option of the Company, on 3 Banking Days’ prior notice. For purposes hereof: (i) “LIBOR” shall mean the rate (rounded upward to the nearest sixteenth and adjusted for reserves required on “Eurocurrency Liabilities” (as herein after defined) for banks subject to “FRB Regulation D” (as herein after defined) or required by any other federal law or regulation) quoted by the British Bankers Association (the “BBA”) at 11:00 a.m. London time 2 Banking Days before the commencement of the Interest for Period for the offering of U.S. dollar deposits in the London interbank market for the Interest Period designated by the Company, as published by Bloomberg or another major information vendor listed on the BBA’s official website; (ii) “Banking Day” shall mean a day on which CoBank is open for business, dealings in U.S. dollar deposits are being carried out in the London interbank market, and banks are open for business in Xxx Xxxx Xxxx xxx Xxxxxx, Xxxxxxx; (iii) “Interest Period” shall mean a period commencing on the day the Company elects to fix a rate under this option and ending on the numerically corresponding day in the next calendar month or the month that is 2, 3 or 6

months or 1 year thereafter, as the case may be: provided, however, that: (x) in the event such ending day is not a Banking Day, such period shall be extended to the next Banking Day unless such next Banking Day falls in the next calendar month, in which case it shall end on the preceding Banking Day; and (y) if there is no numerically corresponding day in the month, then such period shall end on the last Banking Day in the relevant month; (iv) “Eurocurrency Liabilities” shall have meaning as set forth in FRB Regulation D; and (v) “FRB Regulation D” shall mean Regulation D as promulgated by the Board of Governors of the Federal Reserve System, 12 CFR Part 204, as amended.

TREASURY MARGINS

FIXED RATE PRODUCT	INDEX	SPREAD OVER INDEX IN BASIS POINTS (Applicable Treasury Margin)
Two Years	U.S. $ Constant Maturity Treasury (“US$CMT”)	125 bps
Three Years	US$CMT	125 bps
Four Years	US$CMT	125 bps
Five Years	US$CMT	125 bps
Seven Years	US$CMT	140 bps
Ten Years	US$CMT	140 bps
Floor (Minimum) Rate (For Two to Ten Year Fixed Rate Products Only)	CoBank’s cost of funds (as reasonably determined by CoBank in its sole discretion)	105bps

LEVERAGE RATIO (as defined below)	INCREASE/DECREASE TO SPREAD	CHANGE TO APPLICABLE LIBOR and TREASURY MARGINS (IN BASIS POINTS)
A. Equal to or greater than 1.35:1.00	Increase	20
B. Equal to or greater than 1.20:1.00, but less than 1.35:1.00	None	0
C. Less than 1.20:1.00, but greater than or equal to 1.00:1.00	Decrease	10
D. Less than 1.00:1.00	Decrease	20

Leverage Ratio: The Company will maintain a leverage ratio of not more than 1.50:1.0. Leverage ratio is long term debt (excluding current maturities) calculated in accordance with GAAP plus or minus the difference between actual working capital and Minimum Net Working Capital (as defined in the MLA No. Z269, Section 10, as it may be amended), divided by total members investments plus the estimated unit retains.

SECTION 5. Promissory Note. The Company promises to repay the loans that are outstanding in 6 equal, consecutive annual principal payments of $7,603,420.83, with the first such payment due on or before December 31, 2003, and a final principal payment due in an amount equal to the remaining unpaid principal balance on or before December 31, 2009. If any installment due date is not a day on which CoBank is open for business, then such payment shall be made on the next day on which CoBank is open for business. In addition to the above, the Company promises to pay interest on the unpaid principal balance hereof at the times and in accordance with the provisions set forth in Section 4 hereof. This note replaces and supersedes, but does not constitute payment of the indebtedness evidenced by, the promissory note set forth in the Supplement being amended and restated hereby.

The Company shall be permitted to make special payments, in a minimum amount of $111,500.00, on the variable rate portion of this loan, when all short term financing, including the Company’s seasonal loans, Commodity Credit Corporation loans and other short term loans have been zeroed out. These special payments may be readvanced through the expiration date of the Commitment. Reinstatement may be denied and canceled at any time at the option of CoBank. The reinstatable commitments arising from such special payments shall be subject to the Commitment Fee as described in Section 8 below.

SECTION 7. Commitment Fee. In consideration of the Commitment, the Company agrees to pay to CoBank a commitment fee on the average daily unused portion of the Commitment at the rate of 20 basis points per annum (calculated on a 360 day basis), payable quarterly in arrears by the 20th day following each calendar quarter. Such fee shall be payable for each calendar quarter (or portion thereof) occurring during the original or any extended term of the Commitment.

SECTION 10. Amendment Fee. In consideration of the amendment, the Company agrees to pay to CoBank on the execution hereof a fee in the amount of $7,603.43.

IN WITNESS WHEREOF, the parties have caused this Supplement to be executed by their duly authorized officers as of the date shown above.

CoBANK, ACB		AMERICAN CRYSTAL SUGAR COMPANY


By:	/s/ Xxxxxxx Xxxxxxxxxx	By:	/s/ Xxx Xxx

Title:	Vice President	Title:	TREASURER

				7-30-03
				[ILLEGIBLE]

Loan No. Z269T02DNP

REVOLVING TERM LOAN SUPPLEMENT

SECTION 1. The Revolving Term Loan Commitment. On the terms and conditions set forth in the MLA and this Supplement, CoBank agrees to make loans to the Company during the period set forth below in an aggregate principal amount not to exceed $5,012,277.55 at any one time outstanding (the “Commitment”). Within the limits of the Commitment, the Company may borrow, repay and reborrow, provided, however, no advances shall be made on this Term Loan, until Term Loan No. Z269T01D, (as it may be amended), has been fully advanced.

SECTION 2. Purpose and Transfer. The purpose of the Commitment is to finance the operating needs of the Company.

SECTION 3. Term. The term of the Commitment shall be from the date hereof, up to and including July 31, 2003, or such later date as CoBank may, in its sole discretion, authorize in writing.

SECTION 4. Interest. The Company agrees to pay interest on the unpaid balance of the loans in accordance with one or more of the following interest rate options, as selected by the Company:

option and ending on the numerically corresponding day in the next calendar month or the month that is 2, 3 or 6 months or 1 year thereafter, as the case may be; provided, however, that: (x) in the event such ending day is not a Banking Day, such period shall be extended to the next Banking Day unless such next Banking Day falls in the next calendar month, in which case it shall end on the preceding Banking Day; and (y) if there is no numerically corresponding day in the month, then such period shall end on the last Banking Day in the relevant month; (iv) “Eurocurrency Liabilities” shall have meaning as set forth in FRB Regulation D; and (v) “FRB Regulation D” shall mean Regulation D as promulgated by the Board of Governors of the Federal Reserve System, 12 CFR Part 204, as amended.

(D) Treasury Option. At a fixed rate equal to Applicable “Treasury” Margin per annum (as described in terms of basis points (“bps”) in the chart immediately set forth below) above the “U.S. Treasury Rate” (as hereinafter defined). Under this option, balances of $2,000,000.00 or more may be fixed on or before for periods ranging from two years to the final maturity date of the loan, as selected by the Company. However, rates may not be fixed in such a manner as to require the Company to have to repay any fixed rate balance prior to the last day of its fixed rate period in order to pay any installment of principal. For purposes hereof, the “U.S. Treasury Rate” shall mean the yield to maturity on U.S. Treasury instruments having the same maturity date as the last day of the fixed rate period selected by the Company, as calculated from the bid price indicated by Telerate (page 5) at the time the rate is fixed. If, however, no instrument is indicated for the maturity selected, then the rate shall be interpolated based on the bid prices quoted for the next longest and shortest maturities so indicated. In the event Telerate ceases to provide such quotations or materially changes the form or substance of page 5 (as determined by CoBank), then CoBank will notify the Company and the parties hereto will agree upon a substitute basis for obtaining such quotations.

TREASURY MARGINS

FIXED RATE PRODUCT	INDEX	SPREAD OVER INDEX IN BASIS POINTS (Applicable Treasury Margin)
Two Years	U.S.$ Constant Maturity Treasury (“US$CMT”)	125bps
Three Years	US$CMT	125bps
Four Years	US$CMT	125bps
Five Years	US$CMT	125bps
Seven Years	US$CMT	140bps
Ten Years	US$CMT	140bps
Floor (Minimum) Rate (For Two to Ten Year Fixed Rate Products Only)	CoBank’s cost of funds (as reasonably determined by CoBank in its sole discretion)	105bps

The spread over all of the above indices, including the Floor (Minimum) Rate, may increase or decrease for future fixed amounts based on the Borrower’s previous fiscal quarter’s leverage ratio, as follows:

LEVERAGE RATIO (as defined below)	INCREASE/DECREASE TO SPREAD	CHANGE TO APPLICABLE LIBOR and TREASURY MARGINS (IN BASIS POINTS)
A. Equal to or greater than 1.35:1.00	Increase	20
B. Equal to or greater than 1.20:1.00, but less than 1.35:1.00	None	0
C. Less than 1.20:1.00, but greater than or equal to 1.00:1.00	Decrease	10
D. Less than 1.00:1.00	Decrease	20

SECTION 5. Promissory Note. The Company promises to repay the loans that are outstanding in 2 equal, consecutive annual principal payments of $2,000,000.00, with the first such payment due on or before December 31, 2003, and the second such payment due on or before December 31, 2004, and a final principal payment due in an amount equal to the remaining unpaid principal balance on or before December 31, 2005. If any installment due date is not a day on which

CoBank is open for business, then such payment shall be made on the next day on which CoBank is open for business. In addition to the above, the Company promises to pay interest on the unpaid principal balance hereof at the times and in accordance with the provisions set forth in Section 4 hereof. This note replaces and supersedes, but does not constitute payment of the indebtedness evidenced by, the promissory note set forth in the Supplement being amended and restated hereby.

SECTION 6. Prepayment. Subject to Section 13 of the MLA, the loans may be prepaid in whole or in part on one CoBank business day’s prior written notice. During the term of the Commitment, prepayments shall be applied to such balances, fixed or variable, as the Company shall specify. After the expiration of the term of the Commitment, prepayments shall, unless CoBank otherwise agrees, be applied to principal installments in the inverse order of their maturity and to such balances, fixed or variable, as CoBank shall specify.

SECTION 7. Commitment Fee. In consideration of the Commitment, the Company agrees to pay to CoBank a commitment fee on the average daily unused portion of the Commitment at the rate of 20 basis points per annum (calculated on a 360 day basis), payable quarterly in arrears by the 20th day following each calendar quarter. Such fee shall be payable for each calendar quarter (or portion thereof) occurring during the original or any extended term of the Commitment.

SECTION 8. Letters of Credit. If agreeable to CoBank in its sole discretion in each instance, in addition to loans, the Company may utilize the Commitment to open irrevocable letters of credit for its account. Each letter of credit will be issued within a reasonable period of time after receipt of a duly completed and executed copy of CoBank’s then current form of application (or, if applicable, in accordance with the terms of any CoTrade-Agreement between the parties), and shall reduce the amount available under the Commitment by the maximum amount capable of being drawn thereunder. Any draw under any letter of credit issued hereunder shall be deemed an advance under the Commitment. Each letter of credit must be in form and content acceptable to CoBank in its sole discretion, must expire no later than the maturity date of the loans. There shall be a fee for issuing each letter of Credit that shall be determined by CoBank at the time of application and paid by the Company at or before issuance or as otherwise agreed.

SECTION 9. Security. In addition to any other security that may otherwise be required or provided, the Company’s obligations to CoBank under this Supplement are secured by that Restated Mortgage and Security Agreement dated September 15, 1998, from American Crystal Sugar Company to St. Xxxx Bank for Cooperatives (now known as CoBank as a result of merger), as Collateral Agent, as amended on January 31, 2003 by that certain Modification Agreement to the Amended and Restated Mortgage and Security Agreement.

IN WITNESS WHEREOF, the parties have caused this Supplement to be executed by their duly authorized officers as of the date shown above.

CoBANK, ACB		AMERICAN CRYSTAL SUGAR COMPANY


By:	/s/ Xxxxxxx Xxxxxxxxxx	By:	/s/ Xxx Xxx

Title:	Vice President	Title:	TREASURER

Loan No. Z269T03BNP

SINGLE ADVANCE TERM LOAN SUPPLEMENT

THIS SUPPLEMENT to the Amended and Restated Master Loan Agreement dated as of July 21, 2003 (the “MLA”), is entered into as of July 21, 2003, between CoBANK, ACB (“CoBank”) and AMERICAN CRYSTAL SUGAR COMPANY, Moorhead, Minnesota (the “Company”), and amends and restates the Supplement dated April 21, 2000 and numbered Z269T03A NP (the “Existing Supplement”).

SECTION 1. The Term Loan. This Supplement is to evidence a term loan to the Company in the original principal commitment amount of $12,000,000.00 (the “Loan”). The Loan was originally evidenced by Note No. 30800NP (the “Note”) and was subject to the terms of that certain Note Agreement dated December 5, 1994 by and among the Company, CoBank’s predecessor (the St. Xxxx Bank for Cooperatives), and Bank of North Dakota (the “Note Agreement”). The Note was replaced by the Existing Supplement. The outstanding principal balance of the Loan as of the date hereof is $4,800,000.00.

SECTION 2. Purpose and Transfer. The purpose of this Supplement is to replace the Existing Supplement and transfer the indebtedness evidenced thereby to this Supplement. As of the date of this Supplement, the Existing Supplement shall be deemed replaced and superseded, but the indebtedness evidenced by the Existing Supplement shall not be deemed to have been paid off by this Supplement. The Note Agreement shall continue to remain in full force and effect except that any reference to the “Loan” shall be deemed to mean the indebtedness evidenced by this Supplement, and any reference to “Loan Agreement” shall be deemed a reference to the MLA. To the extent that the Note Agreement may be inconsistent with the terms of this Supplement or the MLA, the terms of the Note Agreement shall control. All security given-to secure the Note shall secure this Supplement.

SECTION 3. Availability. The date for permitting advances under the Note has expired. There is no further availability.

SECTION 4. Interest. The Company agrees to pay interest on the unpaid balance of the Loan at such rate or rates as determined in accordance with the terms of the Note Agreement. As of the date hereof the interest rate is fixed at 6.34% per annum and shall remain fixed at such rate for the period as provided for in the Note Agreement. All other matters regarding the calculation and payment of interest shall be in accordance with the terms of the Note Agreement (including, without limitation, the terms applicable to prepayment of fixed rate loans prior to pricing maturity dates).

SECTION 5. Promissory Note. The Company promises to repay the Loan in accordance with the repayment terms of the Note Agreement. If any installment due date is not a day on which CoBank is open for business, then such payment shall be made on the next day on which CoBank is open for business. In addition to the above, the Company promises to pay interest on the unpaid principal balance hereof at the times and in accordance with the terms of the Note Agreement. This note replaces and supersedes, but does not constitute payment of the indebtedness evidenced by, the promissory note set forth in the Supplement being amended and restated hereby.

SECTION 6. Prepayment. Subject to the terms of the Note Agreement, the Loan may be prepaid in whole or in part on one CoBank business day’s prior written notice.

SECTION 7. Security. In addition to any other security that may otherwise be required or provided, the Company’s obligations to CoBank under this Supplement are secured by that Restated Mortgage and Security Agreement dated September 15, 1998, from American Crystal Sugar Company to St. Xxxx Bank for Cooperatives (now known as CoBank as a result of merger), as Collateral Agent, as amended on January 31, 2003 by that certain Modification Agreement to the Amended and Restated Mortgage and Security Agreement.

IN WITNESS WHEREOF, the parties have caused this Supplement to be executed by their duly authorized officers as of the date shown above.

CoBANK, ACB		AMERICAN CRYSTAL SUGAR COMPANY


By:	/s/ Xxxxxxx Xxxxxxxxxx	By:	/s/ Xxx Xxx

Title:	Vice President	Title:	TREASURER

Loan No. Z269T04A

NON-REVOLVING CREDIT SUPPLEMENT

(Letter of Credit)

THIS SUPPLEMENT to the Amended and Restated Master Loan Agreement dated July 21, 2003 (the “MLA”), is entered into as of July 21, 2003, between CoBANK, ACB (“CoBank”) and AMERICAN CRYSTAL SUGAR COMPANY, Moorhead, Minnesota (the “Company”) and amends and restates the Supplement dated March 31, 2000 and numbered Z269T04 (the “Existing Supplement”).

SECTION 1. The Non-Revolving Credit Facility. On the terms and conditions set forth in the MLA and this Supplement, CoBank agrees to make loans to the Company during the period set forth below in an aggregate principal amount not to exceed $31,000,000.00 at any one time outstanding (the “Commitment”). Amounts borrowed and later repaid may not be reborrowed.

SECTION 2. Purpose. The purpose of the Commitment is to reimburse CoBank in the event of draws on letters of credit issued by CoBank (or its predecessor) for the benefit of the Company, and to renew, extend and refinance the Company’s obligations to CoBank under the Existing Supplement.

SECTION 3. Term. The term of the Commitment shall be from the date hereof, up to and including April 30, 2013 (the “Maturity Date”), or such later date as CoBank may, in its sole discretion, authorize in writing.

SECTION 4. Interest. The Company agrees to pay interest on the unpaid principal balance of the loan(s), in accordance with the following interest rate:

CoBank Base Rate. The unpaid principal balance shall bear interest at a rate per annum equal at all times to the rate of interest established by CoBank from time to time as its CoBank Base Rate, which Rate is intended by CoBank to be a reference and not its lowest rate. The CoBank Base Rate will change on the date established by CoBank as the effective date of any change therein and CoBank agrees to notify the Company of any such change.

Interest shall be calculated on the actual number of days each loan is outstanding on the basis of a year consisting of 360 days and shall be payable monthly in arrears by the 20^th day of the following month or such other date that CoBank shall require in a written notice to the Company.

SECTION 5. Promissory Note. The Company promises to repay the unpaid principal balance of the loans on demand, or if no demand is made, then any time on or before the Commitment expiration date. In addition to the above, the Company promises to pay interest on the unpaid principal balance of the loans at the times and in accordance with the provisions set forth in Section 4 hereof.

letter of credit must be in form and content acceptable to CoBank in its sole discretion, must expire no later than the Maturity Date. There shall be a fee for issuing each letter of Credit that shall be determined by CoBank at the time of application and paid by the Company at or before issuance or as otherwise agreed.

IN WITNESS WHEREOF, the parties have caused this Supplement to be executed by their duly authorized officers as of the date shown above.

CoBANK, ACB		AMERICAN CRYSTAL SUGAR COMPANY

By:	/s/ Xxxxxxx Xxxxxxxxxx	By:	/s/ Xxx Xxx

Title:	Vice President	Title:	TREASURER

Loan No. Z269T05

REVOLVING TERM LOAN SUPPLEMENT

SECTION 1. The Revolving Term Loan Commitment. On the terms and conditions set forth in the MLA and this Supplement, CoBank agrees to make loans to the Company during the period set forth below in an aggregate principal amount not to exceed $15,000,000.00 at any one time outstanding (the “Commitment”). Within the limits of the Commitment, the Company may borrow, repay and reborrow.

SECTION 2. Purpose. The purpose of the Commitment is to provide for short-term commercial and standby letters of credit, and, if the Commitment under the Statused Revolving Credit Supplement No. Z269S01E (as it may be amended from time to time) is fully advanced, then to provide for the operating needs of the Company.

SECTION 3. Term. The term of the Commitment shall be from the date hereof, up to and including August 1, 2005, or such later date as CoBank may, in its sole discretion, authorize in writing.

SECTION 4. Interest. The Company agrees to pay interest on the unpaid balance of the loans in accordance with one or more of the following interest rate options, as selected by the Company:

(A) Base Rate Option. At a-rate per annum at all times equal to the Base Rate. For the purposes hereof, Base Rate means that rate in effect from day to day defined as the “prime rate” as published from time to time in the Eastern Edition of The Wall Street Journal as the average prime lending rate for seventy-five percent (75%) of the United States; thirty (30) largest commercial banks, or if The Wall Street Journal shall cease publication or cease publishing the “prime rate” on a regular basis, such other regularly published average prime rate applicable to such commercial banks as is acceptable to the Lender in its reasonable discretion. Loans for which the Base Rate option is selected are referred to herein as “Base Rate Loans”. Base Rate Loans shall be made available on any Banking Day.

(C) LIBOR Option. At a fixed rate equal to “LIBOR” (as hereinafter defined) plus 100 basis points per annum. Under this option: (a) rates may be fixed for “Interest Periods” (as hereinafter defined) of 1, 2, 3 or 6 months, or 1 year, as selected by the Company; (b) the minimum amount that may be fixed at any one time shall be $2,000,000.00; and (c) rates may only be fixed on a “Banking Day” (as hereinafter defined) or, at the option of the Company, on 3 Banking Days’ prior notice. For purposes hereof: (i) “LIBOR” shall mean the rate (rounded upward to the nearest sixteenth and adjusted for reserves required on “Eurocurrency Liabilities” (as hereinafter defined) for banks subject to “FRB Regulation D” (as hereinafter defined) or required by any other federal law or regulation) quoted by the British Bankers Association (the “BBA”) at 11:00 a.m. London time 2 Banking Days before the commencement of the Interest for Period for the offering of U.S. dollar deposits in the London interbank market for the Interest Period designated by the Company, as published by Bloomberg or another major

information vendor listed on the BBA’s official website; (ii) “Banking Day” shall mean a day on which CoBank is open for business, dealings in U.S. dollar deposits are being carried out in the London interbank market, and banks are open for business in Xxx Xxxx Xxxx xxx Xxxxxx, Xxxxxxx; (iii) “Interest Period” shall mean a period commencing on the day the Company elects to fix a rate under this option and ending on the numerically corresponding day in the next calendar month or the month that is 2, 3 or 6 months or 1 year thereafter, as the case may be; provided, however, that: (x) in the event such ending day is not a Banking Day, such period shall be extended to the next Banking Day unless such next Banking Day falls in the next calendar month, in which case it shall end on the preceding Banking Day; and (y) if there is no numerically corresponding day in the month, then such period shall end on the last Banking Day in the relevant month: (iv) “Eurocurrency Liabilities” shall have meaning as set forth in FRB Regulation D; and (v) “FRB Regulation D” shall mean Regulation D as promulgated by the Board of Governors of the Federal Reserve System, 12 CFR Part 204, as amended.

(1) Notwithstanding anything herein to the contrary, if, on or prior to the determination of the LIBOR rate for any LIBOR Interest Period, CoBank determines (which determination shall be conclusive) that quotations of interest rates in accordance with the definition of LIBOR rate are not being provided in the relevant amounts or for the relevant maturities for purposes of determining rates of interest for LIBOR rate advances as provided in this Supplement, then CoBank shall give the Company prompt notice thereof, and so long as such condition remains in effect, CoBank shall be under no obligation to make LIBOR rate loans, convert Base Rate loans into LIBOR rate loans, or continue LIBOR rate loans, and the Company shall, on the last day(s) of the then current applicable LIBOR Interest Period(s) for the outstanding LIBOR rate loans, either prepay such LIBOR rate loans or such LIBOR rate loans shall automatically be converted into a Base Rate loan in accordance with this Section 4.

(2) If any law, treaty, rule, regulation or determination of a court or governmental authority or any change therein or in the interpretation or application thereof subsequent to the date hereof (each, a “Change in Law”) shall make it unlawful for CoBank to (a) advance any LIBOR rate loan or (b) maintain all or any portion of a LIBOR rate loan, then CoBank shall promptly notify the Company thereof. In the former event, any obligation of CoBank to make available any future LIBOR rate loan shall immediately be canceled (and, in lieu thereof shall be made as a Base Rate loan or Quoted Rate loan at the option of the Company), and in the latter event, any such unlawful LIBOR rate loan or portions thereof then outstanding shall be converted, at the option of the Company, to either a Base Rate loan or a Quoted Rate loan; provided, however, that if any such Change in Law shall permit the LIBOR rate to remain in effect until the expiration of the LIBOR rate period applicable to any such unlawful LIBOR rate loan, then such LIBOR rate loan shall continue in effect until the expiration of such LIBOR rate period. Upon the occurrence of any of the foregoing events on account of any Change in Law, the Company shall pay to CoBank immediately upon demand such amounts as may be necessary to compensate CoBank for any fees, charges, or other costs incurred or payable by CoBank as a result thereof and which are attributable to any LIBOR rate loans made available to the Company hereunder.

(3) If CoBank shall determine that, after the date hereof, the adoption of any applicable Law, rule or regulation regarding capital adequacy, or any change therein, or any change in the interpretation or administration thereof by any governmental authority, central bank or comparable agency charged with the interpretation or administration thereof, or any request or directive regarding capital adequacy (whether or not having the force of law) of any such governmental authority, central bank or comparable agency, has or would have the effect of reducing the rate of return on capital of CoBank as a consequence of CoBank’s obligations hereunder to a level below that which CoBank could

have achieved but for such adoption, change, request or directive (taking into consideration its policies with respect to capital adequacy existing on the date of this Supplement) by an amount deemed by CoBank to be material, then from time to time, within fifteen (15) days after demand by CoBank, the Company shall pay to CoBank such additional amount or amounts as will compensate CoBank for such reduction. CoBank agrees to take reasonable steps to reduce the amount of such increase, provided, however, that CoBank shall not be required to take any such step, if in CoBank’s sole opinion, CoBank would suffer an economic loss or any negative legal or regulatory consequences as a result thereof. If CoBank is to require the Company to make payments under this Section then CoBank must make a demand on the Company to make such payment within ninety (90) days of the later of (1) the date on which such capital costs are actually incurred by CoBank, or (2) the date on which CoBank knows, or should have known, that such capital costs have been incurred by CoBank.

The Company shall select the applicable rate option at the time it requests a loan hereunder and may, subject to the limitations set forth above, elect to convert balances bearing interest at the variable rate option to one of the fixed rate options. Upon the expiration of any fixed rate period, interest shall automatically accrue at the variable rate unless the amount fixed is repaid or fixed for an additional period. Notwithstanding the foregoing, rates may not be fixed for periods expiring after the maturity date of the loans. All elections provided for herein shall be made telephonically or in writing and must be received by 12:00 Noon Company’s local time; in the case of LIBOR rate loans, all such elections must be made in writing. Interest shall be calculated on the actual number of days each loan is outstanding on the basis of a year consisting of 360 days and shall be payable monthly in arrears by the 20th day of the following month or such other day that CoBank shall require in a written notice to the Company, and at maturity; provided, however, in the event the Company elects to fix all or a portion of the indebtedness outstanding under the LIBOR interest rate option above, interest shall be payable at the maturity of the interest period and if the LIBOR interest rate fix is for a period longer than 3 months, interest on that portion of the indebtedness outstanding shall be payable quarterly in arrears on each anniversary of the date the LIBOR interest rate fix was made and at maturity.

SECTION 5. Promissory Note. The Company promises to repay the loans that are outstanding at the time the Commitment expires. If any installment due date is not a day on which CoBank is open for business, then such payment shall be made on the next day on which CoBank is open for business. In addition to the above, the Company promises to pay interest on the unpaid principal balance hereof at the times and in accordance with the provisions set forth in Section 4 thereof.

SECTION 6. Letters of Credit. If agreeable to CoBank in its sole discretion in each instance, in addition to loans, the Company may utilize the Commitment to open irrevocable letters of credit for its account. Each letter of credit will be issued within a reasonable period of time after receipt of a duly completed and executed copy of CoBank’s then current form of application (or, if applicable, in accordance with the terms of any CoTrade Agreement between the parties), and shall reduce the amount available under the Commitment by the maximum amount capable of being drawn thereunder. Any draw under any letter of credit issued hereunder shall be deemed an advance under the Commitment. Each letter of credit must be in form and content acceptable to CoBank in its sole discretion, must expire no later than the time the Commitment expires. The fee for issuing each letter of credit shall be 100 basis points of the face amount of each letter of credit, along with an issuance fee to CoBank, for its own account, equal to the greater of (a) 1/8% of the face amount of the letter of credit, or (b) $2,000, payable by the Company at or before issuance or as otherwise agreed. The Company promises to repay the outstanding balance on the Commitment in full on demand, or if no demand is made, then any time on or before the Commitment expiration date of August 1, 2005.

SECTION 8. Loan Origination Fee. In consideration of the Commitment, the Company agrees to pay to CoBank on the execution hereof a loan origination fee in the amount of $11,250.00.

IN WITNESS WHEREOF, the parties have caused this Supplement to be executed by their duly authorized officers as of the date shown above.

CoBANK, ACB		AMERICAN CRYSTAL SUGAR COMPANY

By:	/s/ Xxxxxxx Xxxxxxxxxx	By:	/s/ Xxx Xxx

Title:	Vice President	Title:	TREASURER

Loan No. Z269T06

REVOLVING TERM LOAN SUPPLEMENT

SECTION 1. The Revolving Term Loan Commitment. On the terms and conditions set forth in the MLA and this Supplement, CoBank agrees to make loans to the Company from the date hereof, up to and including August 1, 2004, in an aggregate principal amount not to exceed, at any one time outstanding, $15,000,000.00 less the amounts scheduled to be repaid during the period set forth below in Section 5 (the “Commitment”). Within the limits of the Commitment, the Company may borrow, repay and reborrow.

SECTION 2. Purpose. The purpose of the Commitment is to finance the operating needs of the Company.

SECTION 3. Term. Intentionally Omitted.

SECTION 4. Interest. The Company agrees to pay interest on the unpaid balance of the loans in accordance with one or more of the following interest rate options, as selected by the Company.

(B) Quoted Rate. At a fixed rate per annum to be quoted by CoBank in its sole discretion in each instance. Under this option, rates may be fixed on such balances and for such periods, as may be agreeable to CoBank in its sole discretion in each instance, provided that: (1) the maximum fixed period shall be 1 day; (2) the minimum amount that may be fixed each time shall be $2,000,000.00.

(C) LIBOR Option. At a fixed rate equal to “LIBOR” (as hereinafter defined) plus 100 basis points per annum (the “LIBOR Spread”). Under this option: (a) rates may be fixed for “Interest Periods” (as hereinafter defined) of 1, 2, 3 or 6 months, or 1 year, as selected by the Company; (b) the minimum amount that may be fixed at any one time shall be $2,000,000.00; and (c) rates may only be fixed on a “Banking Day” (as hereinafter defined) or, at the option of the Company, on 3 Banking Days’ prior notice. For purposes hereof: (i) “LIBOR” shall mean the rate (rounded upward to the nearest sixteenth and adjusted for reserves required on “Eurocurrency Liabilities” (as hereinafter defined) for banks subject to “FRB Regulation D” (as hereinafter defined) or required by any other federal law or regulation) quoted by the British Bankers Association (the “BBA”) at 11:00 a.m. London time 2 Banking Days before the commencement of the Interest for Period for the offering of U.S. dollar deposits in the London interbank market for the Interest Period designated by the Company, as published by Bloomberg or another major information vendor listed on the BBA’s official website; (ii) “Banking Day” shall mean a day on which CoBank is open for business, dealings in U.S. dollar deposits are being carried out in the London interbank market, and banks are open for business in Xxx Xxxx Xxxx xxx Xxxxxx, Xxxxxxx; (iii) “Interest Period” shall mean a period commencing on the day the Company elects to fix a rate under this option

and ending on the numerically corresponding day in the next calendar month or the month that is 2, 3 or 6 months or 1 year thereafter, as the case may be; provided, however, that: (x) in the event such ending day is not a Banking Day, such period shall be extended to the next Banking Day unless such next Banking Day falls in the next calendar month, in which case it shall end on the preceding Banking Day; and (y) if there is no numerically corresponding day in the month, then such period shall end on the last Banking Day in the relevant month; (iv) “Eurocurrency Liabilities” shall have meaning as set forth in FRB Regulation D; and (v) “FRB Regulation D” shall mean Regulation D as promulgated by the Board of Governors of the Federal Reserve System, 12 CFR Part 204, as amended.

The LIBOR Spread may increase or decrease for future fixed amounts based on the Company’s previous fiscal quarter’s leverage ratio, as follows:

LEVERAGE RATIO (as defined below)	INCREASE/DECREASE TO LIBOR SPREAD	CHANGE TO THE LIBOR SPREAD (IN BASIS POINTS)
A. Equal to or greater than 1.35:1.00	Increase	20
B. Equal to or greater than 1.20:1.00, but less than 1.35:1.00	None	0
C. Less than 1.20:1.00, but greater than or equal to 1.00:1.00	Decrease	10
D. Less than 1.00:1.00	Decrease	20

Changes to the LIBOR Spread shall be made quarterly on the latter of either: (a) five business days after the Bank’s receipt of the Company’s certification of compliance with the leverage ratio, or (b) 30 days after the end of each calendar quarter. If the Company fails to timely furnish to CoBank the compliance certificate as required to be delivered pursuant to the MLA, then the change to the LIBOR Spread shall be an increase of the highest permitted under the above chart.

forth below shall be deemed amended accordingly. All elections provided for herein shall be made telephonically or in writing and must be received by 12:00 Noon Company’s local time. Interest shall be calculated on the actual number of days each loan is outstanding on the basis of a year consisting of 360 days and shall be payable monthly in arrears by the 20th day of the following month; provided, however, in the event the Company elects to fix all or a portion of the indebtedness outstanding under the LIBOR interest rate option above, interest shall be payable at the maturity of the interest period and if the LIBOR interest rate fix is for a period longer than 3 months, interest on that portion of the indebtedness outstanding shall be payable quarterly in arrears by the 20th day of the following month and at maturity.

SECTION 5. Promissory Note. The Company promises to repay on the dates set forth below, the outstanding principal, if any, that is in excess of the listed amounts:

Payment Date	Reducing Commitment Amount

December 31, 2004	$	12,857,142.86
December 31, 2005	$	10,714,285.72
December 31, 2006	$	8,571,428.58
December 31, 2007	$	6,428,571.44
December 31, 2008	$	4,285,714.30
December 31, 2009	$	2,142,857.16

followed by a final installment in an amount equal to the remaining unpaid principal balance of the loans on December 31, 2010.

SECTION 8. Commitment Fee. In consideration of the Commitment, the Company agrees to pay to CoBank a commitment fee on the average daily unused portion of the Commitment at the rate of 20 basis points per annum (calculated on a 360 day basis), payable quarterly in arrears by the 20th day following each calendar quarter. Such fee shall be payable for each calendar quarter (or portion thereof) occurring during the original or any extended term of the Commitment.

SECTION 9. Origination Fee. In consideration of the Commitment, the Company agrees to pay to CoBank on the execution hereof a loan origination fee in the amount of $15,000.00.

IN WITNESS WHEREOF, the parties have caused this Supplement to be executed by their duly authorized officers as of the date shown above.

CoBANK, ACB		AMERICAN CRYSTAL SUGAR COMPANY

By:	/s/ Xxxxxxx Xxxxxxxxxx	By:	/s/ Xxx Xxx

Title:	Vice President	Title:	TREASURER

Loan No. Z269S01E

STATUSED REVOLVING CREDIT SUPPLEMENT

SECTION 1. The Revolving Credit Facility. On the terms and conditions set forth in the MLA and this Supplement, CoBank agrees to make loans to the Company during the period set forth below in an aggregate principal amount not to exceed, at any one time outstanding, the lesser of the “Borrowing Base” (as calculated pursuant to the Borrowing Base Certificate, the form of which is attached hereto as Exhibit A) or $235,000,000.00 (the “Commitment”). Within the limits of the Commitment, but subject to the Borrowing Base, the Company may borrow, repay and reborrow.

SECTION 2. Purpose. The purpose of the Commitment is to finance the Company’s general corporate purposes, fund working capital requirements, and support the Company’s commercial paper program.

SECTION 3. Term. The term of the Commitment shall be from the date hereof, up to and including August 1, 2004, or such later date as CoBank may, in its sole discretion, authorize in writing.

SECTION 4. Interest. The Company agrees to pay interest on the unpaid balance of the loans in accordance with one or more of the following interest rate options, as selected by the Company:

(A) Base Rate Option. At a rate per annum at all times equal to the Base Rate. For the purposes hereof, Base Rate means that rate in effect from day to day defined as the “prime rate” as published from time to time in the Eastern Edition of The Wall Street Journal as the average prime lending rate for seventy-five percent (75%) of the United States’ thirty (30) largest commercial banks, or if The Wall Street Journal shall cease publication or cease publishing the “prime rate” on a regular basis, such other regularly published average prime rate applicable to such commercial banks as is acceptable to the Lender in its reasonable discretion. Loans for which the Base Rate option is selected are referred to herein as “Base Rate Loans”. Base Rate Loans shall be: (a) in minimum amounts of $5,000,000 and incremental multiples of $1,000,000; and (b) made available on any Banking Day.

(C) LIBOR Option. At a fixed rate equal to “LIBOR” (as hereinafter defined) plus 100 basis points per annum. Under this option: (a) rates may be fixed for “Interest Periods” (as hereinafter defined) of 1, 2, 3 or 6 months, or 1 year, as selected by the Company; (b) the minimum amount that may be fixed at any one time shall be $5,000,000.00; and (c) rates may only be fixed on a “Banking Day” (as hereinafter defined) or, at the option of the Company, on 3 Banking Days’ prior notice. For purposes hereof: (i) “LIBOR” shall mean the rate (rounded upward to the nearest sixteenth and adjusted for reserves required on “Eurocurrency Liabilities” (as hereinafter defined) for banks subject to “FRB Regulation D” (as hereinafter defined) or required by any other federal law or regulation) quoted by the British Bankers Association (the “BBA”) at 11:00 a.m. London time 2 Banking Days before the commencement of the Interest Period for the offering of U.S. dollar deposits in the London interbank market for the Interest Period designated by the Company, as published by Bloomberg or another major

information vendor listed on the BBA’s official website; (ii) “Banking Day” shall mean a day on which CoBank is open for business, dealings in U.S. dollar deposits are being carried out in the London interbank market, and banks are open for business in Xxx Xxxx Xxxx xxx Xxxxxx, Xxxxxxx; (iii) “Interest Period” shall mean a period commencing on the day the Company elects to fix a rate under this option and ending on the numerically corresponding day in the next calendar month or the month that is 2, 3 or 6 months or 1 year thereafter, as the case may be; provided, however, that: (x) in the event such ending day is not a Banking Day, such period shall be extended to the next Banking Day unless such next Banking Day falls in the next calendar month, in which case it shall end on the preceding Banking Day; and (y) if there is no numerically corresponding day in the month, then such period shall end on the last Banking Day in the relevant month; (iv) “Eurocurrency Liabilities” shall have meaning as set forth in FRB Regulation D; and (v) “FRB Regulation D” shall mean Regulation D as promulgated by the Board of Governors of the Federal Reserve System, 12 CFR Part 204, as amended.

(1) Notwithstanding anything herein to the contrary, if, on or prior to the determination of the LIBOR rate for any LIBOR Interest Period, CoBank determines (which determination shall be conclusive) that quotations of interest rates in accordance with the definition of LIBOR rate are not being provided in the relevant amounts or for the relevant maturities for purposes of determining rates of interest for LIBOR rate advances as provided in this Supplement, then CoBank shall give the Company prompt notice thereof, and so long as such condition remains in effect, CoBank shall be under no obligation to make LIBOR rate loans, convert Base Rate loans into LIBOR rate loans, or continue LIBOR rate loans, and the Company shall, on the last day(s) of the then current applicable LIBOR Interest Period(s) for the outstanding LIBOR rate loans, either prepay such LIBOR rate loans or such LIBOR rate loans shall automatically be converted into a Base Rate loan in accordance with this Section 4

(2) If any law, treaty, rule, regulation or determination of a court or governmental authority or any change therein or in the interpretation or application thereof subsequent to the date hereof (each, a “Change in Law”) shall make it unlawful for CoBank to (a) advance any LIBOR rate loan or (b) maintain all or any portion of a LIBOR rate loan, then CoBank shall promptly notify the Company thereof. In the former event, any obligation of CoBank to make available any future LIBOR rate loan shall immediately be canceled (and, in lieu thereof shall be made as a Base Rate loan or Quoted Rate loan at the option of the Company), and in the latter event, any such unlawful LIBOR rate loan or portions thereof then outstanding shall be converted, at the option of the Company, to either a Base Rate loan or a Quoted Rate loan; provided, however, that if any such Change in Law shall permit the LIBOR rate to remain in effect until the expiration of the LIBOR rate period applicable to any such unlawful LIBOR rate loan, then such LIBOR rate loan shall continue in effect until the expiration of such LIBOR rate period. Upon the occurrence of any of the foregoing events on account of any Change in Law, the Company shall pay to CoBank immediately upon demand such amounts as may be necessary to compensate CoBank for any fees, charges, or other costs incurred or payable by CoBank as a result thereof and which are attributable to any LIBOR rate loans made available to the Company hereunder.

(3) If CoBank shall determine that, after the date hereof, the adoption of any applicable Law, rule or regulation regarding capital adequacy, or any change therein, or any change in the interpretation or administration thereof by any governmental authority, central bank or comparable agency charged with the interpretation or administration thereof, or any request or directive regarding capital adequacy (whether or not having the force of law) of any such governmental authority, central bank or comparable agency, has or would have the effect of

reducing the rate of return on capital of CoBank as a consequence of CoBank’s obligations hereunder to a level below that which CoBank could have achieved but for such adoption, change, request or directive (taking into consideration its policies with respect to capital adequacy existing on the date of this Supplement) by an amount deemed by CoBank to be material, then from time to time, within fifteen (15) days after demand by CoBank, the Company shall pay to CoBank such additional amount or amounts as will compensate CoBank for such reduction. CoBank agrees to take reasonable steps to reduce the amount of such increase, provided, however, that CoBank shall not be required to take any such step, if in CoBank’s sole opinion, CoBank would suffer an economic loss or any negative legal or regulatory consequences as a result thereof. If CoBank is to require the Company to make payments under this Section then CoBank must make a demand on the Company to make such payment within ninety (90) days of the later of (1) the date on which such capital costs are actually incurred by CoBank, or (2) the date on which CoBank knows, or should have known, that such capital costs have been incurred by CoBank.

The Company shall select the applicable rate option at the time it requests a loan hereunder and may, subject to the limitations set forth above, elect to convert balances bearing interest at the variable rate option to one of the fixed rate options. Upon the expiration of any fixed rate period, interest shall automatically accrue at the variable rate unless the amount fixed is repaid or fixed for an additional period. Notwithstanding the foregoing, rates may not be fixed for periods expiring after the maturity date of the loans. All elections provided for herein shall be made telephonically or in writing and must be received by 12:00 Noon Company’s local time; in the case of LIBOR rate loans, all such elections must be made in writing. Interest shall be calculated on the actual number of days each loan is outstanding on the basis of a year consisting of 360 days and shall be payable monthly in arrears by the 20th day of the following month or such other day that CoBank shall require in a written notice to the Company, and at maturity; provided, however, in the event the Company elects to fix all or a portion of the indebtedness outstanding under the LIBOR interest rate option above, interest shall be payable at the maturity of the interest period and if the LIBOR interest rate fix is for a period longer than 3 months, interest on that portion of the indebtedness outstanding shall be payable quarterly in arrears on each anniversary of the date the LIBOR interest rate fix was made and at maturity.

SECTION 5. Promissory Note. The Company promises to repay the unpaid principal balance of the loans on the first CoBank business day following the last day of the term of the Commitment. In addition to the above, the Company promises to pay interest on the unpaid principal balance of the loans at the times and in accordance with the provisions set forth in Section 4 hereof. This note replaces and supersedes, but does not constitute payment of the indebtedness evidenced by, the promissory note set forth in the Supplement being amended and restated hereby.

SECTION 6. Borrowing Base Certificate, Etc. The Company agrees to furnish a Borrowing Base Certificate to CoBank at such times or intervals as CoBank may from time to time request. Until receipt of such a request, the Company agrees to furnish a Borrowing Base Certificate to CoBank as soon as available after the end of each quarter, but in no event more than 5 days after the Company’s quarterly filing with the Securities Exchange Commission, calculating the Borrowing Base as of the last day of the quarter for which the Certificate is being furnished. However, if no balance is outstanding hereunder on the last day of such period, no Report need be furnished. Regardless of the frequency of the reporting, if

at any time the amount outstanding under the Commitment exceeds the Borrowing Base, the Company shall immediately notify CoBank and repay so much of the loans as is necessary to reduce the amount outstanding under the Commitment to the limits of the Borrowing Base.

SECTION 7. Commitment Fee. In consideration of the Commitment, the Company agrees to pay to CoBank a commitment fee on the average daily unused portion of the Commitment at the rate of 20 basis points per annum (calculated on a 360 day basis), payable quarterly in arrears by the 20^th day following each calendar quarter. Such fee shall be payable for each calendar quarter (or portion thereof) occurring during the original or any extended term of the Commitment.

SECTION 8. Utilization Fee. For any day on which the outstanding principal amount of loans shall be greater than 25% of the Commitment (but no greater than 50% of the Commitment), the Company shall pay to CoBank a utilization fee equal to 0.125% per annum (calculated on a 360 day basis) on the aggregate amount outstanding on such day. For any day on which the outstanding principal amount of loans shall be greater than 50% of the Commitment, the Company shall pay to CoBank a utilization fee equal to 0.25% per annum (calculated on a 360 day basis) on the aggregate amount outstanding on such day. Accrued and unpaid utilization fees, if any, shall be payable quarterly in arrears by the 20^th day following each calendar quarter.

SECTION 9. Facility Fee. In consideration of the Commitment, the Company agrees to pay to CoBank on the execution hereof, a fee in the amount of $176,250.00.

IN WITNESS WHEREOF, the parties have caused this Supplement to be executed by their duly authorized officers as of the date shown above.

CoBANK, ACB		AMERICAN CRYSTAL SUGAR COMPANY

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

Title:	Assistant Corporate Secretary	Title:	Assistant Treasurer

EXHIBIT “A”

[Form of Borrowing Base]
American Crystal Sugar Company

Monthly Borrowing Base
For the month ended

Trade Accounts Receivables		$	@ 80%	$
(a)

Trade Accounts Receivables are defined as those of the Company and all Subsidiaries which: (1) arise from the sale and delivery of inventory on ordinary trade terms; (2) are evidenced by an invoice; (3) are net of any credit, trade or other allowance given to the account debtor; (4) are not owing by an account debtor who has become insolvent or is the subject of any bankruptcy, reorganization, liquidation or like proceeding; (5) are not subject to any offset or deduction; (6) are not owing by an affiliate of Company; (7) are not owing by an obligor located outside of the U.S. unless the receivable is supported by a letter of credit issued by a bank acceptable to the CoBank; and (8) are not government receivables. The above provisions notwithstanding, Trade Receivables shall also exclude (i) any accounts that are past due more than 90 days, and (ii) any contra account regardless of the date;

Inventory

(b)

Inventory as determined on the basis of Net Realizable Value, defined as the expected selling price of an inventory item less expected costs to complete and dispose, as determined in accordance with GAAP.

Crop Payments due Non-members and members	$	(c)

Net Inventory Value (b-c)	$	@ 75%	$
(d)

Borrowing Base (a+d)			$

Commercial Paper			$
(e)

Seasonal Loan				(f)

Commodity Credit Corp. loans
(g)

Total Short-term Loans (e+f+g)	$

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AMENDED AND RESTATED MASTER LOAN AGREEMENT

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