WARRANT AGREEMENT

Exhibit 10.1

WARRANT AGREEMENT

THIS WARRANT AGREEMENT (the “Agreement”), dated as of June 30, 2008, is made and entered into by and between Syntroleum Corporation, a Delaware corporation (the “Company”), and Tyson Foods, Inc., a Delaware corporation (“Warrantholder”) (both the Company and the Warrantholder may be referred to collectively as the “Parties”).

The Parties are each 50% owners of Dynamic Fuels, LLC, a Delaware limited liability company (“DF”) which has been approved for $100,000,000 of funding under certain Go-Zone revenue bonds originated by the Louisiana Public Facilities Authority (the “Bonds”).

As a condition to DF obtaining funding under the Bonds, among other things, the Warrantholder is providing a letter of credit in the amount of $100,000,000 to guarantee DF’s obligations under the Bonds (the “Guarantee”).

The Parties agreement is that each of them has effective responsibility as between each other for one-half of the Guarantee, and the Parties agree, as between each other, that each of the Company and the Warrantholder is obligated for one-half of any and all amounts disbursed arising out of and pursuant to the Guarantee, up to $50,000,000 each. Warrantholder agrees to provide the Guarantee in its name, as the Company’s financial condition does not presently support its issuance of a letter of credit or other form of guarantee in the necessary amount. Warrantholder further agrees to maintain the Guarantee until the Bonds reach final maturity, or until DF is financially able to provide the Guarantee and elects to do so. As consideration to induce the Warrantholder to provide the Guarantee, Company and the Warrantholder have agreed that the Company will issue and deliver to the Warrantholder warrants (the “Warrants”) to purchase up to eight million shares (the “Shares”) of the Company’s common stock, par value $.01 per share (the “Common Stock”) upon the terms and conditions of this Agreement, pursuant to the terms set forth herein.

The cost of issuing the Bonds, consisting of the items identified in Attachment 1, shall be borne by DF. Annual costs payable by DF in relation to the Bonds include (i) the interest payments on the Bonds; (ii) the annual Remarketing Agent fee; (iii) the annual fee payable to the Bondholders’ Trustee; and (iv) the letter of credit fees for supplying the Letter of Credit guaranty from Warrantholder for the Bonds. Any fees in addition to those mentioned above are subject to the approval of DF.

In consideration of the foregoing recitals, covenants, and agreements, and for the purpose of defining the terms and provisions of the Warrants and the respective rights and obligations thereunder, the Company and the Warrantholder, for value received, hereby further agree as follows:

Section 1. Transferability and Form of Warrants .

1.1 Registration . The Warrants shall be numbered and shall be registered on the books of the Company when issued.

1.2 Limitations on Transfer .

(a) The Warrants and the Shares shall not be sold, assigned, transferred, pledged or otherwise encumbered except upon the conditions specified in this Agreement. Warrantholder will cause any proposed purchaser, assignee, transferee or pledgee of the Warrants or the Shares, except for transferees in dispositions of Shares that are pursuant to an effective registration statement under the Securities Act of 1933 (the “Act”), or dispositions of Shares pursuant to Rule 144 or Rule 144A under the Act, to agree to take and hold such securities subject to the provisions and upon the conditions specified in this Agreement. The Warrants may be divided or combined, upon request to the Company by a Warrantholder, into a certificate or certificates representing the right to purchase the same aggregate number of Shares. Unless the context indicates otherwise, the term “Warrantholder” shall include any transferee or transferees of the Warrants or the Shares that are required to be bound by the terms hereof, and the term “Warrants” shall include any and all warrants outstanding pursuant to this Agreement, including those evidenced by a certificate or certificates issued upon division, exchange or substitution pursuant to this Agreement. Warrantholder by its receipt of a Warrant certificate, agrees to be bound by and comply with the terms of this Agreement. Warrantholder represents and agrees that the Warrant (and Shares if the Warrant is exercised) is purchased only for investment, for such Warrantholder’s own account, and without any present intention to sell, or with a view to distribution of, the Warrant or Shares.

(b) If Warrantholder desires to sell the Warrants, Warrantholder shall deliver a written notice thereof (“Right of First Offer Notice”) to the Company.

(c) Upon receipt of the Right of First Offer Notice, the Company shall have thirty (30) calendar days to provide Warrantholder with a binding, written offer (the “Offer”) to purchase the Warrants. Any Offer must include, at a minimum, a price, in cash, for the Warrants, a description of any material conditions applicable to the purchase thereof, and the time period within which the Company is prepared to close such purchase (which shall be as soon as reasonably practicable, but in no event later than sixty (60) calendar days after the date-of the Right of First Offer Notice). Upon receipt of an Offer from the Company, Warrantholder shall have the right, but not the obligation, to accept the same by delivering written notice to the Company, which notice shall constitute a contract between Warrantholder to sell, and the Company to purchase, the Warrants on the terms and conditions described therein.

(d) If Warrantholder elects not to accept any Offer, Warrantholder may sell the Warrants to a third party, provided that, the sale price for the Warrants must be in cash and may not be less than 105% of the price set forth in any Offer that was timely delivered to Warrantholder. The sale must be concluded within the later to occur of (i) one hundred eighty (180) calendar days from the date of such election and (ii) receipt of any third party consents or approvals required in connection with such sale. If Warrantholder elects not to accept an Offer for the Warrants and does not agree to sell the Warrants in accordance with the terms of this Agreement within thirty (30) calendar days of such election, then Warrantholder shall not sell the Warrants for a period of one (1) year following the expiration of such thirty (30) calendar day period. Following such one (1) year period, if Warrantholder desires to sell the Warrants, Warrantholder shall once again deliver a Right of First Offer Notice to the Company.

1.3 Form of Warrants . The text of the Warrants and of the form of election to purchase Shares shall be substantially as set forth in Exhibit A attached hereto. The number of Shares issuable upon exercise of the Warrants is subject to adjustment upon the occurrence of certain events, all as hereinafter provided. The Warrant shall be executed on behalf of the Company by its Chief Executive Officer, President or by a Vice President, attested to by its Secretary or an Assistant Secretary. A Warrant bearing the signature of an individual who was at the time of execution thereof the proper officer of the Company shall bind the Company, notwithstanding that such individual shall have ceased to hold such office prior to the delivery of such Warrant or did not hold such office on the date of this Agreement.

The Warrants shall be dated as of the date of signature thereof by the Company either upon initial issuance or upon division, exchange or substitution.

1.4 Legend on Warrants . Each Warrant certificate shall bear the following legends:

Any certificate issued at any time in exchange or substitution for any certificate bearing such legends (except, in the case of the Shares, a new certificate issued upon completion of a public distribution pursuant to a registration statement under the Act or upon completion of a sale under Rule 144 or Rule 144A under the Act of the securities represented thereby) shall also bear the above legend or similar legend unless, in the opinion of the Company’s counsel, the securities represented thereby need no longer be subject to such restrictions. Warrantholder consents to the Company making a notation on its records and giving instructions to any registrar or transfer agent of the Warrants and the Common Stock in order to implement the restrictions on transfer established in this Agreement.

Section 2. Exchange of Warrant Certificate . Any Warrant certificate may be exchanged for another certificate or certificates entitling a Warrantholder to purchase a like aggregate number of Shares as the certificate or certificates surrendered then entitled such Warrantholder to purchase. Any Warrantholder desiring to exchange a Warrant certificate shall make such request in writing delivered to the Company, and shall surrender, properly endorsed, the certificate evidencing the Warrant to be so exchanged. Thereupon, the Company shall execute and deliver to the person entitled thereto a new Warrant certificate as so requested.

Section 3. Issuance of Warrants; Term of Warrants; Exercise of Warrants; Amount of Warrants .

(a) On the date of funding of the Bonds, the Company shall issue a Warrant certificate evidencing Warrants representing the right, subject to the provisions contained herein and therein, to purchase from the Company up to eight million Shares; provided that in the event the number of shares of Common Stock issuable pursuant to the exercise of a Warrant to be issued pursuant to this Section 3(a), (i) when aggregated with all other shares of Common Stock then owned beneficially by the Warrantholder, would result in the beneficial ownership by the Warrantholder (assuming such Warrants were exercisable) of a number of shares of Common Stock equal to or in excess of 20% of the outstanding shares of Common Stock on the date of issuance or (ii) when aggregated with all other shares of Common Stock issuable pursuant to the exercise of all Warrants previously issued pursuant to this Section 3(a) and all warrants previously issued pursuant to the Warrant Agreement dated as of June 22, 2007 between the Company and the Warrantholder (the “2007 Agreement”) would result in the issuance upon exercise of all such Warrants and warrants of a number of shares of Common Stock equal to or in excess of 20% of the outstanding shares of Common Stock as of the date of this Agreement, then the number of shares of Common Stock issuable pursuant to the exercise of such Warrant shall be reduced to the maximum number of shares of Common Stock that does not equal or exceed such amount. The Company represents to the Warrantholder that the Company has all corporate power and authority to issue the Warrants and the Shares (and the warrants and the shares contemplated by the 2007 Agreement) to the Warrantholder and has obtained all consents and approvals required in connection with the issuance of the Warrants and the Shares (and the warrants and the shares contemplated by the 2007 Agreement) to the Warrantholder; provided, that shareholder approval has not been obtained based upon the maximum share limitations set forth in the preceding sentence.

(b) Subject to the terms of this Agreement, including without limitation subsection (e) of this Section 3, Warrantholder shall have the right, at any time and from time to time on a day that is not a Saturday, Sunday or public holiday in Tulsa, Oklahoma, to exercise the Warrants and to purchase from the Company up to the number of duly authorized, fully paid and nonassessable Shares to which Warrantholder may at the time be entitled to purchase pursuant to this Agreement, upon surrender to the Company, at its principal office, of the certificate evidencing the Warrants to be exercised, together with the purchase form on the reverse thereof duly completed and signed, and upon payment to the Company of the Warrant Price, for the number of Shares in respect of which such Warrants are then exercised, but in no event for less than 100 Shares for any Warrantholder (unless less than an aggregate of 100 Shares are then purchasable under all outstanding Warrants held by a Warrantholder).

(c) Payment by Warrantholder of the aggregate Warrant Price shall be made in cash or by immediately available funds, check or any combination thereof.

(d) Upon such surrender of the Warrants and payment of such Warrant Price as aforesaid, the Company shall issue and cause to be delivered to or upon the written order of the exercising Warrantholder and in the name of the exercising Warrantholder a certificate or certificates for the number of full Shares so purchased upon the exercise of his Warrant, together with cash, as provided in Section 9 hereof, in respect of any fractional Shares otherwise issuable upon such surrender. Such certificate or certificates shall be deemed to have been issued and the exercising Warrantholder shall be deemed to have become a holder of record of such securities as of the date of surrender of the Warrants and payment of the Warrant Price, as aforesaid, notwithstanding that the certificate or certificates representing such securities shall not actually have been delivered or that the stock transfer books of the Company shall then be closed. The Warrants shall be exercisable, at the election of a Warrantholder, either in full or from time to time in part and, in the event that a certificate evidencing the Warrants is exercised in respect of less than all of the Shares specified therein, a new certificate evidencing the remaining portion of the Warrants held by such Warrantholder will be issued by the Company.

(e) The Parties acknowledge that the number of Warrants exercisable into Shares hereunder shall be based on a pro-rata delivery of the Warrants determined by the actual credit support supplied by Warrantholder. The following calculation method shall be used.

Definition:

X – is the maximum credit support offered by Warrantholder with the same general terms and conditions as the Bonds . X is equal to $50,000,000 (fifty million dollars).

Y – is the maximum number of warrants to be issued by Company concurrent with $50,000,000 (fifty million) in credit support to Company. Y is equal to 8,000,000 (eight million) warrants

Z – is the Warrant Ratio which is equal to Y divided by X which is 0.16 warrants per $1 of credit support supplier by Warrantholder.

P – is the percentage of the Bond allocated to Company based on Company’s ownership in the project financed by the Bonds. As of the date of this Agreement P = 50%

B – is the gross Bond amount issued

GCS – is the gross credit support required by Company from Warrantholder which is equal to P times B.

XWH – is the credit support for the Bonds supplied by Company and may be voluntary or mandatory. Company supplied credit support is mandatory if GCS is greater than X. Company must determine the level of voluntary credit support for the Bonds to be supplied by the Company no later than the date on which the DF Management Committee approves the resolution to issue the Bonds

XC – is the credit support supplied by the Warrantholder

WD – is the Warrants due Warrantholder

The calculation is described as follows and illustrated the following example calculations

WD = (B*P-XWH)*Z

Example Calculation

Example 1 — Bond Amount Less Than $100 million, voluntary credit support from Company

Example 2 — Bond amount equals $100 million, no credit support from Company

Example 3 — Bond amount greater than $100 million, mandatory credit support from Company

Illustrative calculations only. Other combination exist.

(f) The Warrants shall not be issued upon the occurrence of any of the following events:

(g) The Warrants will expire four (4) years from the date of issuance.

Section 4. Payment of Taxes . The Company will pay all documentary stamp taxes, if any, attributable to the initial issuance of the Warrants or the Shares; provided, however, the Company shall not be required to pay any tax which may be payable in respect of any secondary transfer of the Warrants or the Shares.

Section 5. Mutilated or Missing Warrants . In case the certificate or certificates evidencing the Warrants shall be mutilated, lost, stolen or destroyed, the Company shall, at the request of a Warrantholder, issue and deliver in exchange and substitution for and upon cancellation of the mutilated certificate or certificates, or in lieu of and substitution for the certificate or certificates lost, stolen or destroyed, a new Warrant certificate or certificates of like tenor and representing an equivalent right or interest, but only upon receipt of evidence satisfactory to the Company of such loss, theft or destruction of such Warrant and a bond of indemnity, if requested, also satisfactory in form and amount at the applicant’s cost. Applicants for such substitute Warrants certificate shall also comply with such other reasonable regulations and pay such other reasonable charges as the Company may prescribe.

Section 6. Reservation of Shares; No Impairment .

(a) There has been reserved, and the Company shall at all times keep reserved so long as the Warrants remain outstanding, out of its authorized Common Stock, such number of shares of Common Stock as shall be subject to purchase under the Warrants. On or before taking any action that would cause an adjustment pursuant to the terms of the Warrants resulting in an increase in the number of shares of Common Stock deliverable upon such conversion or exercise above the number thereof previously authorized, reserved and available therefor, the Company shall take all such action so required for compliance with this Section.

(b) The Company shall not by any action, including, without limitation, amending its charter documents or through any reorganization, reclassification, transfer of assets, consolidation, merger, dissolution, issue or sale of securities or any other similar voluntary action, avoid or seek to avoid the observance or performance of any of the terms of this Agreement, but will at all times in good faith assist in the carrying out of all such terms and in the taking of all such actions as may be necessary or appropriate to protect the rights of the Warrantholder against impairment.

Section 7. Warrant Price . The price per Share at which Shares shall be purchasable upon the exercise of the Warrants (the “Warrant Price”) is, subject to adjustment pursuant to Section 8 hereof, $0.01.

Section 8. Adjustment of Number of Shares . The number of securities purchasable upon the exercise of the Warrants and the Warrant Price shall be subject to adjustment from time to time upon the happening of certain events, as follows:

8.1 Adjustments . The number of Shares purchasable upon the exercise of the Warrants and the Warrant Price shall be subject to adjustment as follows:

(a) If the Company after the date hereof shall (1) make or pay a dividend or make a distribution in shares of Common Stock on its Common Stock, (2) subdivide its outstanding shares of Common Stock into a greater number of shares or (3) combine or reclassify its outstanding shares of Common Stock into a smaller number of shares, the number of Shares purchasable upon exercise of the Warrants immediately prior to such action shall be adjusted so that a Warrantholder upon exercise of the Warrants shall be entitled to receive the number of shares of Common Stock which it would have owned or would have been entitled to receive immediately following such action had the Warrants been exercised immediately prior thereto. An adjustment made pursuant to this subsection (a) shall become effective on the day immediately after the record date, except as provided in subjection (g) below, in the case of a dividend or distribution and shall become effective on the day immediately after the effective date in the case of a subdivision or combination. Whenever the number of Shares purchasable upon the exercise of a Warrant is adjusted as provided in this paragraph (a), the Warrant Price shall be adjusted by multiplying such Warrant Price immediately prior to such adjustment by a fraction, of which the numerator shall be the number of Shares purchasable upon the exercise of the Warrants immediately prior to such adjustment, and of which the denominator shall be the number of Shares so purchasable immediately thereafter.

(b) If the Company after the date hereof shall distribute any rights, warrants or options to all holders of its Common Stock entitling them, for a period expiring within sixty (60) days after the record date for such distribution, to purchase shares of Common Stock or securities convertible into Common Stock at a price per share less than the Relevant Current Market Price Per Share (as defined below), the Warrant Price shall be adjusted by multiplying the Warrant Price in effect immediately prior to such adjustment by a fraction, of which (i) the numerator shall be the sum of (A) the number of shares of Common Stock outstanding on the record date for the distribution to which this subsection (b) is being applied and (B) the number of shares of Common Stock which the aggregate price of the total number of shares of Common Stock offered pursuant to the distribution to which this subsection (b) is being applied would purchase at the Relevant Current Market Price Per Share and (ii) the denominator shall be the sum of (A) the number of shares of Common Stock outstanding on the record date for the distribution to which this subsection (b) is being applied and (B) the number of additional shares of Common Stock offered pursuant to the distribution to which this subsection (b) is being applied. For purposes of this subsection (b), the “Relevant Current Market Price Per Share” means the then Current Market Value per share of the Common Stock (determined as provided in subsection (e) below) on the record date