August 2, 2021
Via E-Mail
William E. Hanigan, Esq.
Dentons Davis Brown
The Davis Brown Tower
215 10th Street, Suite 1300
Des Moines, IA 50309
Re: Heron Lake BioEnergy, LLC
Amended Schedule 13E-3
Filed July 23, 2021
File No. 005-84239
Revised Preliminary Proxy Statement on Schedule 14A
Filed July 23, 2021
File No. 000-51825
Dear Mr. Hanigan:
We have reviewed your filings and have the following comments. In some
of our
comments, we may ask you to provide us with information so we may better
understand your
disclosure.
Revised Preliminary Proxy Statement
Summary, page 2
1. We note that you captioned a section as HLBE s Financial Advisor
s Recommendation
while the fairness opinion provided by Business Advisory Services states
that it is not a
recommendation. Please revise or advise.
2. Please revise this section to include a summary of the most material
terms of the
transaction. For example, include a summary of the fairness
determination made by the
filing persons. See Item 1001 of Regulation M-A.
3. Please revise this section to consolidate it with the Questions and
Answers section.
Also, relocate the sections captioned Proposals to be Voted On,
The Merger, and
The Merger Agreement such that you comply with the requirements of
Rule 13e-
3(e)(1)(ii).
William E. Hanigan, Esq.
c/o Heron Lake BioEnergy, LLC
August 2, 2021
Page | 2
Background of the Merger, page 21
4. Please quantify the shortages in the loan covenants relating to
working capital and local
net worth, described on page 22.
5. We note your disclosure that discussions about the going private
transaction
commenced in January 2021. Please tell us why GFE did not file an
amendment to its
Schedule 13D at this time or until June 2020.
6. On a related note, GFE filed an amendment to its Schedule 13D on June
28, 2021 for
an event that took place on March 24, 2021. Please tell us how GFE
complied with its
obligation to file an amendment to its Schedule 13D promptly.
7. We note that on January 28, 2021 BPI provided a valuation report to
the Company s
board of governors. Please provide the disclosure required by Item
1015 of Regulation
M-A and file the report as an exhibit to your Schedule 13E-3, as
required by Item
1016(c) of Regulation M-A.
8. Please quantify the per unit prices referenced in the entry for
January 28, 2021.
Fairness of the Transaction, page 32
9. Please revise your disclosure to ensure that each filing person makes
a fairness
determination. See Item 1014 of Regulation M-A.
10. Please revise this section to ensure that the fairness determination
addresses fairness to
unaffiliated security holders. Your current disclosure refers to the
Minority Ownership
Interest, which includes some members of your board of governors. Such
persons are
affiliates of the company.
11. Refer to your discussion of substantive fairness. You appear to rely
on the BAS opinion
to support your fairness determination. We note that the BAS opinion
addresses
fairness to the company. As noted above, the fairness determination
required by
Schedule 13E-3 must address fairness to the unaffiliated security
holders. Please revise
or advise.
12. Please revise your disclosure to summarize the contents of the opinion
provided by
Business Advisory Services. Alternatively, you may choose to include
such opinion as
an annex to the proxy statement delivered to security holders.
13. It appears that two of the three analyses conducted by Business
Advisory Services
resulted in a value higher than the amount payable to minority
security holders. To the
extent you retain this opinion as supportive of the fairness
determination required by
Schedule 13E-3 as described above, please revise your disclosure to
describe what
actions, if any, the Minority Interest Directors took in addressing
those analyses.
14. Please revise this section to address fairness in relation to the net
book value of your
units. See instruction 2(iii) to Item 1014 of Regulation M-A.
William E. Hanigan, Esq.
c/o Heron Lake BioEnergy, LLC
August 2, 2021
Page | 3
15. Please disclose the fees paid to BAS and BPI during the past two years
and the fees
paid or payable to each for the work described in your proxy
statement.
Where You Can Find More Information, page 62
16. Please note that forward incorporation by reference, as you attempt to
do in this section, is
not permitted in connection with a Schedule 13E-3. Please revise.
We remind you that the filing persons are responsible for the
accuracy and adequacy of
their disclosures, notwithstanding any review, comments, action or absence of
action by the staff.
Please direct any questions to me at (202) 551-3619.
Sincerely,
/s/ Daniel F.
Duchovny
Daniel F.
Duchovny
Special Counsel
Office of
Mergers and Acquisitions