VeraSun Energy Corporation (VEC), through its subsidiaries, operates as an ethanol producer in the United States. The Company is also a pure-play ethanol producer, focusing primarily on the production and sale of ethanol and its co-products. VEC owns and operates two ethanol production facilities in the United States, with a combined ethanol production capacity of 230 million gallons per year. The Company also produces and sells wet distillers grains (WDGS) and dry distillers grains (DDGS) as ethanol co-products. VEC's subsidiaries include VeraSun Aurora Corporation (VAC) (formerly known as VeraSun Energy Corporation), VeraSun Fort Dodge, LLC (VFD), VeraSun Charles City, LLC (VCC), VeraSun Welcome, LLC (VW), VeraSun Marketing, LLC (VM) and VeraSun BioDiesel, LLC (VBD). VAC owns and operates an ethanol plant, referred to as the Aurora Facility, located near Aurora, South Dakota, with a capacity of 120 million gallons per year. VFD owns and operates an ethanol plant, referred to as the Fort Dodge Facility, located near Fort Dodge, Iowa, with a capacity of 110 million gallons per year. VCC is a development-stage company, which is constructing an ethanol plant, referred to as Charles City Facility, near Charles City, Iowa, with a capacity of 110 million gallons per year. VW is a development-stage company, which is not engaged in any operations. VM markets and distributes E85 to gasoline retailers. E85 is an ethanol vehicle fuel, which contains 85% denatured ethanol and 15% gasoline. VBD is also a development-stage company, which is researching the extraction of corn oil as an additional co-product in the ethanol production process. During the year ended December 31, 2005, the Company produced approximately 128 million gallons of fuel ethanol and 402,000 tons of distillers grains. In February 2006, the Company and General Motors Corporation (General Motors) announced a collaborative partnership to promote the use of E85 in flexible fuel vehicles (FFVs), and the installation of the Company's branded VE85 fuel pumps at 20 service stations in the Chicago area. In March 2006, VEC announced that it is adding VE85 fuel pumps at 14 service stations in the Minneapolis area. The Company markets its distillers grains both nationally and locally through its sales force. VEC's DDGS and WDGS are primarily marketed to agricultural customers for use as animal feed. These sales are made pursuant to agreements typically lasting from 6 to 12 months. During 2005, DDGS accounted for 88.4% of the Company's co-product sales, and sales of WDGS accounted for 11.6% of its co-product sales. VEC's Aurora Facility is a dry-mill ethanol plant, with a production capacity of 100 million gallons per year. The facility is located in Aurora, South Dakota, on a 420-acre site. The Aurora Facility processes more than 43 million bushels of corn per year, and produces 120 million gallons per year of ethanol and approximately 390,000 tons of dry distillers grains per year. The facility purchases corn from many different suppliers. The Aurora Facility transports ethanol by rail and truck, as needed, and has significant capacity for each form of transportation. Logistics include onsite rail loading and truck loading systems. The Company's Fort Dodge Facility commenced operations in October 2005. The Fort Dodge Facility is located four miles west of Fort Dodge, Iowa. This facility is located on a 270-acre site, and its layout and operations are similar to VEC's Aurora Facility. The Fort Dodge Facility has the capacity to process more than 39 million bushels of corn per year and to produce 110 million gallons per year of ethanol. The Fort Dodge Facility also has the capacity to produce approximately 350,000 tons of dry distillers grains per year. In March 2006, the Company commenced construction of the Charles City Facility, on approximately 370 acres near Charles City, Iowa. In February 2006, VEC acquired options to purchase approximately 440 acres of land near Hartley, Iowa, and approximately 440 acres of land near Everly, Iowa, as potential sites for th

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