1177314--3/31/2010--NORTHERN_GROWERS

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{gas, price, oil}

{cost, regulation, environmental}

{condition, economic, financial}

{competitive, industry, competition}

{operation, natural, condition}

{property, intellectual, protect}

{debt, indebtedness, cash}

{financial, litigation, operation}

{loss, insurance, financial}

{stock, price, operating}

Risks Related to Our Business Our financial performance is significantly dependent on corn and ethanol prices and generally we will not be able to pass on increases in these prices to our customers. The spread between ethanol and corn prices can vary significantly. Corn, as with most other crops, is affected by weather, disease and other environmental conditions. The price of distillers grains is affected by the price of other commodity products, and decreases in the price of these commodities could decrease the price of distillers grains Our debt financing agreements contain, and our future debt financing agreements may contain, restrictive covenants that impose significant restrictions on the operation of our business. Hedging transactions involve risks that could harm our profitability. Our business is subject to seasonal fluctuations. Our business is not diversified because it is limited to the fuel grade ethanol industry, which may limit our ability to adapt to changing business and market conditions. We are heavily dependent upon POET , LLC. We are dependent upon POET Ethanol Products, LLC to purchase and market all of the ethanol produced at our plant Interruptions in energy supplies could delay or halt production at our plant, which will reduce our profitability. We have limited natural gas available for operations and rely heavily on the adjacent Big Stone Plant. Risks Related to the Industry Demand for ethanol may not continue to grow unless ethanol can be blended into gasoline in higher percentage blends for conventional automobiles. Overcapacity in the industry may result in further decreases in the price of ethanol and distillers grains. Decreasing gasoline prices may negatively impact the selling price of ethanol which could reduce our ability to operate profitably The global financial crisis may have impact on our business and financial condition that we currently cannot predict. We operate in an intensely competitive industry and compete with larger, better financed entities which could impact our ability to operate profitably. Competition from the advancement of technology may lessen the demand for ethanol and negatively impact our profitability Corn-based ethanol may compete with cellulose-based ethanol in the future, which could make it more difficult for us to produce ethanol on a cost-effective basis Negative media attention associated with the use of corn in the ethanol production process may lead to decreases in demand for the ethanol we produce, which could negatively affect our profitability. Risks Related to Governmental and Regulatory Action A change in government policies favorable to ethanol may cause demand for ethanol to decline. Tariffs effectively limit imported ethanol into the U.S., and their reduction or elimination could undermine the ethanol industry in the U.S. Government incentives for ethanol production may be eliminated in the future. Changes in environmental regulations or violations of the regulations could reduce our profitability. We may become subject to additional environmental regulation and permitting from the U.S. Environmental Protection Agency

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1177314--3/31/2010--NORTHERN_GROWERS_LLC