1. A dvance BioEnergy Human Resource Vulnerability Assessment Report & Recommendations October 27, 2008 Governance Risk Compliance Denver Omaha Sioux Falls St. Paul © 2008 Milo Belle Consultants, LLC. All Rights Reserved.

6. Milo Belle www.MiloBelle.com Denver Omaha Sioux Falls St. Paul Element Risk Assessment Note: Many processes are being completed accurately. Only areas of concern are noted on this report. Potential for relatively low or no significant monetary impact from penalties or legal action or loss of productivity. -4 noted during abbreviated assessment Level Low Potential for moderate monetary impact from penalties or legal action or loss of productivity. -19 noted during abbreviated assessment Level Medium Potential for significant monetary impact from penalties or legal action or loss of productivity. -23 noted during abbreviated assessment Level High

8. Milo Belle www.MiloBelle.com Denver Omaha Sioux Falls St. Paul Findings and Recommendations HR Organizational Strategy H -Routine HR availability at plants is limited or non-existant -Site Safety Coordinators complete portion of HR responsibilities (with little or no training of HR processes) HR Visibility M -Effectiveness of HR management not available as it is not tracked/trended HR Satisfaction Measurements M -Staff are busy with day-to-day processing with no oversight of major projects/implementation HR Project Plans L -A plan does not exist HR Strategic Plan Risk Level Major Findings

9. Milo Belle www.MiloBelle.com Denver Omaha Sioux Falls St. Paul Findings and Recommendations HR Department Utilization H -Strategic HR knowledge not currently available to guide executives in effective and efficient HR management Trending & Reporting H -HR Dashboard does not exist to measure effectiveness of HR support HR Measurement for Effectiveness H -Work space / confidentiality issues HR Workspace H -Designated staff is eager to learn but acknowledge a deficit for current HR management HR Competencies M -ABE has had turnover in this position which creates inconsistencies and decreased follow-through on process HR Turnover L -Does not exist HR Strategic Plan Risk Level Major Findings

10. Milo Belle www.MiloBelle.com Denver Omaha Sioux Falls St. Paul Findings and Recommendations Staffing and Recruitment H -Statistics are gathered to demonstrate effectiveness of recruitment process -Monthly reports are not generated for vacancy rates, time to fill or cost per hire Trending and Reporting M -Recruitment is not a line item in department budget -Trending information is difficult to capture -Dollars are spent ad hoc and not pre-planned via recruitment plan Recruitment Budgeting H -Staff has not received formal interviewing training -Plant management has not received formal training -Behavioral based interviewing skills not utilized Interviewing Practices H -Exit interviews are completed but not trended -Exit interviews are filed in personnel files Exit Interviews H -Applicant log is not consistently completed with results of hire -No data is collected regarding length of hire, cost of hire HR Applicant Tracking H -Recruitment is done as needed -No defined plan is available -Administrative Assistant coordinates all advertising HR Recruitment Plan Risk Level Major Findings

11. Milo Belle www.MiloBelle.com Denver Omaha Sioux Falls St. Paul Findings and Recommendations Orientation and On-Boarding M -Monthly, quarterly and year-to-date reports not generated and reported to management -Information not available to correlate effectiveness of supervision and turnover Trending & Reporting M -Safety and operational training available -Limited training for managing human capital Supervisory Training M -No annual leadership training budgeted or planned -Annual Sexual Harassment, HIPAA and Employment Law updates are not provided for front line management Annual Training Programs for people management H -Monthly orientation program is not consistent -Orientation checklists not consistently maintained in personnel files Monthly Orientation Risk Level Major Findings

12. Milo Belle www.MiloBelle.com Denver Omaha Sioux Falls St. Paul Findings and Recommendations Compensation and Payroll M -Does not exist in writing or communicated in Employee Handbook Compensation Philosophy L -Payroll outsourced to ADP with onsite support -Costs for ADP processing not reviewed annually in comparison to other vendors Payroll Processing H -HR Staff lack knowledge and awareness of Wage & Hour violations NOTE: Wage & Hour violations are #1 reason for Class Action suites -Supervisors not trained on current Wage & Hour trends and issues Wage & Hour Management Knowledge H -HR staff lacks knowledge of appropriate FSLA determinations FSLA Determinations H -Job Descriptions not available for all positions -Job Descriptions not updated for altered positions Job Descriptions Risk Level Major Findings

13. Milo Belle www.MiloBelle.com Denver Omaha Sioux Falls St. Paul Findings and Recommendations Benefits Administration M -Annual benefit education not completed -Benefit enrollment deferred to vendors Benefit Education and Annual Enrollment M -Not calculated or communicated to employees Benefit Statements M -Current HR staff is not knowledgable about benefit negotiations; process is deferred to CFO Benefit Negotiations M -Onsite processes Benefit enrollment paperwork -Onsite staff unable to answer detailed benefit questions Benefit Administration None -VERY comprehensive and generous benefit package Benefit Package Risk Level Major Findings

14. Milo Belle www.MiloBelle.com Denver Omaha Sioux Falls St. Paul Findings and Recommendations Performance Management / Discipline / Termination H -Performance management issues are not logged or trended -Factual data for benchmarking purposes not available -Annual education/training is not linked to training metrics Trending & Reporting M -Process is detailed in Employee Handbook, but not utilized Grievances H -Training and /or role formal modeling for effective coaching does not exist Coaching H -Performance documentation inconsistent and open to liability Documentation H -”How” managers lead employees is not consistent Consistency M -Does not consistently occur -Management competencies not evaluated Management Training Risk Level Major Findings

15. Milo Belle www.MiloBelle.com Denver Omaha Sioux Falls St. Paul Findings and Recommendations Employee Relations M -Employee related information not communicated routinely to all sites Communications M -Formal training or HR guidance not available with current HR staff Change Management M -Formal training or HR guidance not available with current HR staff Conflict Management M -Not trended or correlated with other HR metrics -Absenteeism related to ADA / FMLA issues not trended Absenteeism H -Completed but information is not trended and correlated with other HR metrics Exit Interviews M -Participation is not trended Employee Opinion Surveys Risk Level Major Findings

16. Milo Belle www.MiloBelle.com Denver Omaha Sioux Falls St. Paul Findings and Recommendations Regulatory Compliance H -High probability of passage and endorsement (depending upon election) EFCA H -HR uncertain and unsure of DOJ regulations and employment law changes -New FMLA regulations effective 2008 for military personnel; further amendments pending Other DOL Issues H -HR uncertain and unsure of DOJ regulations and employment law changes -New ADAAA regulations effective January 2009 Other DOJ Issues H -ADA high risk employees not monitored or proactively managed-Paperwork processing occurs; however, HR trending with remedial recommendations not available ADA / WC H -Knowledge deficit for HR staff -Trending of FMLA data not completed FMLA processing L -I 9 audit revealed inconsistent documentation (information later located but not recorded) I-9 Compliance Risk Level Major Findings

17. Milo Belle www.MiloBelle.com Denver Omaha Sioux Falls St. Paul Milo Belle Consultants, LLC Governance, Risk & Compliance Services Offices in Sioux Falls, St. Paul, Omaha & Denver Corporate Headquarters 431 North Phillips Avenue, Suite 320 Sioux Falls, South Dakota 57104 Corporate Office: 605-275-6527 Or E-mail [email_address] Cell ( 605) 351- 0441