Phenix Biocomposites, LLC

Mankato, Minnesota

$3,000,000 D-I-P, 1^st Mortgage Loan

Collateral Description: Personal property of company including, 25 acres of land, 150,000 square foot manufacturing plant, and equipment.

Borrower Description: Borrower/Operator sought Chapter 11 bankruptcy protection to seek relief from operating deficiencies.

Loan-to-Value: 25% LTV on current 90-day “quick sale.”  Property appraised at $12,000,000.

Status: The loan is presently current with respect to payment. The current loan amount is $2.5 million with an additional $500,000 available.