Membership Interest Pledge Agreement

MEMBERSHIP INTEREST PLEDGE AGREEMENT



This MEMBERSHIP INTEREST PLEDGE AGREEMENT (this " Agreement ") dated as of October 17, 2007, is entered into by ADVANCED BIOENERGY, LLC , a Delaware limited liability company (" Pledgor "), in favor of the Secured Party (as defined below).



RECITALS



A. Concurrently herewith, Pledgor is entering into a Secured Term Loan Note dated of even date herewith (as the same from time to time hereafter may be amended, modified, supplemented or restated, the " Note ") among Pledgor, as borrower, and PJC Capital LLC, a Delaware limited liability company (the " Secured Party "), as lender, pursuant to which the Secured Party has agreed to extend certain loans of money (the " Loans ") to Pledgor on the terms and subject to the conditions set forth in the Note and the other Loan Documents.



B. Pledgor is the record and beneficial owner of 100.0% of the outstanding membership interests in ABE Fairmont, LLC, a Delaware limited liability company (the " Company ") as set forth on Exhibit A attached hereto, which Exhibit is incorporated herein by this reference and may be amended or supplemented pursuant to the terms of this Agreement.



C. The Secured Party is willing to make, extend and maintain the Loans to Pledgor on and after the date of the Note, but only upon the condition, among others, that Pledgor shall have executed this Agreement and delivered this Agreement and the Pledged Collateral (as defined below) to the Secured Party.



AGREEMENT



NOW, THEREFORE , in consideration of the foregoing Recitals and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, and intending to be legally bound, Pledgor hereby represents, warrants, covenants and agrees as follows:



ARTICLE I



DEFINITIONS



1.1 Definitions. All capitalized terms used but not defined herein shall have the respective meanings given to them in the Note. In addition, the following terms shall have the following meanings:



" Operating Agreement " means the Limited Liability Company Agreement of the Company dated as of September 25, 2006, as amended by that Amendment to Limited Liability Company dated as of October 4, 2007 (as the same may be amended, supplemented, and restated or otherwise modified and in effect from time to time, as permitted hereunder), by and between the Company and Pledgor as the sole member.



"Pledged Collateral" has the meaning set forth in Section 2.1 , below.



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"UCC" means the Uniform Commercial Code as the same may, from time to time, be in effect in the State of New York; provided, however , in the event that, by reason of mandatory provisions of law, any or all of the attachment, perfection or priority of the Secured Party92s security interest in any collateral is governed by the Uniform Commercial Code as in effect in a jurisdiction other than the State of New York, the term "UCC" shall mean the Uniform Commercial Code as in effect in such other jurisdiction for purposes of the provisions hereof relating to such attachment, perfection of priority and for purposes of definitions related to such provisions.



1.2 UCC Definitions. Unless otherwise defined herein or the context otherwise requires, terms for which meanings are provided in the UCC are used in this Agreement, including its preamble and recitals, with such meanings.



ARTICLE II



PLEDGE



2.1 Pledge and Grant Of Security Interest. As security for the full, complete and final payment and performance when due (whether at stated maturity, by accelerations or otherwise) of the Obligations under the Note and the other Loan Documents and any and all other debts, liabilities and reimbursement obligations, indemnity obligations and other obligations for monetary amounts (including reimbursement and indemnity obligations), fees, expenses, costs or other sums (including attorneys92 fees and expenses) chargeable to Pledgor under or pursuant to any of the Loan Documents (collectively, the " Secured Obligations "), Pledgor hereby assigns, conveys, mortgages, pledges, hypothecates and transfers to the Secured Party, and hereby grants to the Secured Party, a security interest in and to all of Pledgor92s right, title and interest in, to and under each of the following, whether now existing or hereafter acquired (all of which being hereinafter collectively called the " Pledged Collateral "):



(a) the Operating Agreement and all membership interests and the certificates representing such interests now owned or hereafter acquired by Pledgor in the Company, whether as a result of exchange offers, direct investments or contributions or otherwise, including Pledgor92s rights, now existing or hereafter arising or acquired, to receive from time to time its share of profits, income, surplus, compensation, return of capital, distributions and other reimbursements and payments from the Company (including specific properties of the Company upon dissolution and otherwise), in respect of all such membership interests;



(b) all additional Equity Interests, including shares of capital stock or other equity securities in or of the Company and voting trust certificates from time to time acquired by Pledgor in any manner, and the certificates representing such additional shares, and all dividends, cash, instruments, and other property or proceeds from time to time received, receivable, or otherwise distributed in respect of or in exchange for any or all of such shares; and



(c) The rents, issues, profits, returns, income, allocations, distributions and proceeds of and from any and all of the foregoing.





Pledgor hereby agrees to cause the Company to register pursuant to the UCC the pledge of the membership interests covered in this Section 2.1 .



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2.2 Continuing Security Interest. This Agreement shall create a continuing security interest in the Pledged Collateral and shall:



(a) remain in full force and effect until the Payment in Full of the Secured Obligations;



(b) be binding upon Pledgor and its successors, transferees and assigns; and



(c) inure, together with the rights and remedies of the Secured Party hereunder, to the benefit of the Secured Party.





Upon the Payment in Full of the Secured Obligations, the security interest granted herein shall terminate and all rights to the Pledged Collateral shall revert to Pledgor. Upon any such termination, the Secured Party then shall, at Pledgor92s sole expense, deliver to Pledgor, without any representations, warranties or recourse of any kind whatsoever, any and all certificates and instruments representing or evidencing Pledgor92s interest in the Company that had been previously delivered by Pledgor to the Secured Party, together with all other Pledged Collateral held by the Secured Party hereunder, and execute and deliver to Pledgor, at Pledgor92s sole expense, such documents as Pledgor shall reasonably request to evidence such termination.



2.3 No Assumption. This Agreement is executed and delivered to the Secured Party for collateral security purposes only. Notwithstanding anything herein to the contrary:



(a) Pledgor shall remain liable under the contracts and agreements included in the Pledged Collateral to the extent set forth therein, and shall perform all of its duties and obligations under such contracts and agreements to the same extent as if this Agreement had not been executed;



(b) the exercise by the Secured Party of any of its rights hereunder shall not release Pledgor from any of its duties or obligations under any such contracts or agreements included in the Pledged Collateral; and



(c) the Secured Party shall not have any obligation or liability under any such contracts or agreements included in the Pledged Collateral by reason of this Agreement, nor shall the Secured Party be obligated to perform any of the obligations or duties of Pledgor thereunder or to take any action to collect or enforce any claim for payment assigned hereunder, and the Secured Party shall not hereunder or otherwise (i) assume any obligation or liability under or in connection with the Operating Agreement to any Person, and any such assumption is hereby expressly disclaimed, or (ii) be deemed to be, or otherwise have the duties or responsibilities of, a member or a managing member vested with the powers and responsibilities of the management of the Company.



2.4 Distributions Under Operating Agreement. Unless and until a Default or an Event of Default has occurred and is continuing, Pledgor shall be entitled to receive any and all distributions on account of its membership interests in the Company to the extent entitled thereto under the Operating Agreement.



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ARTICLE III



REPRESENTATIONS AND WARRANTIES



3.1 Representations And Warranties. Pledgor hereby represents and warrants to the Secured Party, as at the date of each pledge and delivery hereunder by Pledgor to the Secured Party of any Pledged Collateral, as set forth in the following Sections 3.1(a) through 3.1(q) , inclusive.



(a) Organization. Pledgor is duly formed and validly existing under the laws of the State of Delaware and has full power and authority to enter into and perform its obligations under this Agreement.



(b) Capacity; Due Authorization; Non-Contravention. The execution, delivery and performance by Pledgor of this Agreement and each other Loan Document executed or to be executed by it have been duly authorized by all necessary action, and do not contravene its organizational documents; and in each case do not:



(i) contravene any material contractual restriction, law or governmental regulation or court decree or order binding on or affecting Pledgor; or



(ii) result in, or require the creation or imposition of, any Lien on any of Pledgor92 s properties except as contemplated hereby.



(c) Binding Obligations. This Agreement constitutes, and each other Loan Document executed by Pledgor will, on the due execution and delivery thereof, constitute, the legal, valid and binding obligations of Pledgor, enforceable against Pledgor in accordance with their respective terms, except as enforcement hereof may be limited by bankruptcy, insolvency or other laws affecting the enforcement of creditors92 rights generally and by general principles of equity.



(d) Filing. No presently effective UCC financing statement covering any of the Pledged Collateral is on file in any public office, except for UCC financing statements in favor of the Secured Party.



(e) Ownership; No Liens. Pledgor is the legal and beneficial owner of, and has all rights and good title to (and has full right and authority to pledge and assign) all Pledged Collateral pledged by Pledgor hereunder, free and clear of all adverse claims or other Liens, except the Lien granted herein to the Secured Party.



(f) Operating Agreement. Pledgor has furnished to the Secured Party a true and correct copy of the Operating Agreement and all amendments thereto, which Operating Agreement, as so amended, constitutes the valid, binding and enforceable obligation of all parties thereto, sets forth the entire agreement of the parties thereto with respect to the subject matter thereof, has not been further amended or modified (except as permitted under Section 4.8 hereof) and remains in full force and effect.



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(g) Membership Interests. Pledgor owns 100% of the membership interests in the Company and in the Company92 s profits, and there are no other members of the Company other than Pledgor, all as set forth in Exhibit A .



(h) Certificate; Operating Agreement. The interest of Pledgor in the Company is represented by such certificates or instruments (together with all necessary instruments of transfer or assignment, duly executed in blank) as have been delivered to the Secured Party or the Secured Party92s designated bailee and are held in its possession. The Operating Agreement provides that any membership interests, units or limited liability company interests in the Company are securities governed by Article 8 of the UCC and the Company has not otherwise "opted-out" of Article 8 of the UCC.



(i) Performance Of Obligations. Pledgor has performed all of its material obligations to date under the Operating Agreement.



(j) Compliance With Securities Laws. The offering and sale of all units of membership interests in the Company have been conducted, in all material respects, in compliance with all applicable state and federal securities laws and regulations and, without limiting the generality of the foregoing, no offering document furnished, to any member in connection therewith contained, any misstatement of a material fact or omitted, to state any fact necessary to make such document not materially misleading.



(k) Information. All information with respect to the Pledged Collateral set forth in any schedule, certificate or other writing at any time furnished by Pledgor to the Secured Party, and all other written information at any time furnished by Pledgor to the Secured Party, is and shall be true and correct in all material respects as of the date furnished.



(l) Records. The address of the location of the records of Pledgor concerning the Pledged Collateral and the address of Pledgor92s principal place of business and chief executive office is set forth in Schedule I to this Agreement.



(m) Authorization; Approval. No authorization, approval, or other action by, and no notice to or filing with, any Governmental Authority, or any other Person is required either:



(i) for the pledge by Pledgor of any Pledged Collateral pursuant to this Agreement or for the execution, delivery, and performance of this Agreement by Pledgor; or



(ii) for the exercise by the Secured Party of (a) the voting or other rights provided for in this Agreement, or (b) the remedies in respect of the Pledged Collateral pursuant to this Agreement, except, in the case of this clause (ii)(b), as may be required in connection with a disposition of such Pledged Collateral by laws affecting the offering and sale of securities generally, or as may be required under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 and regulations issued relating thereto.



(n) Litigation. To Pledgor92s knowledge, there is no claim, investigation, action, suit or proceeding affecting either of Pledgor or the Company pending or overtly threatened by or before any court, arbitrator or Governmental Authority which could with



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reasonable likelihood have a material adverse effect on the ability of Pledgor to perform its obligations under this Agreement.



(o) No Offset or Defense. The Secured Obligations are not subject to any offset or defense of any kind against the Secured Party or the Company.



(p) Continuation of Representations and Warranties. Pledgor covenants, warrants and represents to the Secured Party that all representations and warranties contained in this Agreement shall be true, accurate and complete in all material respects at the time of Pledgor92s execution of this Agreement and, shall continue to be true, accurate and complete in all material respects until the Secured Obligations have been Paid in Full.



ARTICLE IV



COVENANTS



4.1 Protect Pledged Collateral; Further Assurances. Pledgor shall not sell, assign, transfer, pledge or otherwise encumber the Pledged Collateral in any manner (except for the pledge granted herein to the Secured Party), except to the extent permitted by the Note. Pledgor shall warrant and defend the right and title granted by this Agreement to the Secured Party in and to the Pledged Collateral (and all right, title and interest represented by the Pledged Collateral) against the claims and demands of all Persons whomsoever, but nothing contained herein shall prevent the Company from issuing additional Equity Interests. Pledgor agrees, at any time, and from time to time, at the expense of Pledgor, Pledgor shall promptly execute and deliver all further instruments, and take all further action that may be necessary or desirable, or that the Secured Party may reasonably request, in order to perfect and protect any security interest granted or purported to be granted hereby or to enable the Secured Party to exercise and enforce its rights and remedies hereunder with respect to any of the Pledged Collateral as set forth in Article V hereof.



4.2 Voting Rights. If an Event of Default shall have occurred and be continuing and the Secured Party shall have notified Pledgor of the Secured Party92s intention to exercise ...