EXHIBIT 10.43
(COAL SALES ORDER LOGO) [c25165c2516502.gif]
THIS COAL SALES ORDER (“Order”) dated December 5, 2007 confirms the sale of coal
by Westmoreland Coal Sales Company (“WCSC”) to Red Trail Energy, LLC (“Buyer”)
pursuant to the following terms and conditions.

     
ORDER NUMBER:
  Red Trail WCSC #002-2008/2009
 
   
SOURCE:
  The source of the coal to be delivered hereunder shall be from Area D of
Western Energy Company’s (“WECO”) Rosebud Mine located at Colstrip, Montana;
provided that WCSC may also, from time-to-time and with adequate notice to
Buyer, source coal meeting the quality specifications below from other areas of
the Rosebud Mine in the event of availability issues in Area D. Availability
issues may include, among other things, restrictions in production capacity due
to equipment or infrastructure maintenance, temporary geologic conditions that
impact quality and/or volumes, or demands of the base Area D customer.
 
   
 
  Subject to the availability of suitable railcar equipment, cooperation of the
BNSF Railroad, and similar economics to the costs of delivering and using
Rosebud Mine Area D coal, WCSC shall have the right to supply two unit train
shipments (or an equivalent volume in single-car shipments) from the
Westmoreland Resources, Inc. (“WRI”) Absaloka Mine at Sarpy Creek, Montana
during mid-2008 (coinciding with the anticipated Rosebud Mine Area B dragline
extended maintenance outage tentatively scheduled for June-August 2008), and the
parties shall cooperate in good faith to arrange for as many additional
shipments from the Absaloka Mine as possible during the Term of this Order,
provided that Buyer does not incur a total cost of coal delivered to its plant
at Richardton, North Dakota, that exceeds the total cost of coal otherwise
delivered from the Rosebud Mine in single-car lots.
 
   
 
  WCSC and Buyer may also discuss the potential to supply lignite from the
Dakota Westmoreland Corporation (“DWC”) Beulah Mine at Beulah, North Dakota, and
DWC shall make commercially reasonable efforts to supply lignite for a test
burn, as mutually agreed upon.
 
   
 
  WECO, WRI, and DWC are affiliates of WCSC.
 
   
TERM:
  January 1, 2008 through December 31, 2009.
 
   
QUANTITY:
  The quantities of coal to be delivered in each year shall be no less than
90,000 tons and no more than 115,000 tons per year.
 
   
 
  For purposes of this Order, a “ton” shall mean 2,000 pounds avoirdupois.
 
   
 
  In the event Buyer shuts down for any reason or cause and does not purchase
coal from other sources, the amount of coal which Buyer would ordinarily consume
during such shutdown will be reduced and such amount shall be deducted from the
amount of coal Buyer is required to purchase pursuant to this Order. Buyer will
give prompt notice to WCSC of any shutdown and the reduced amount of coal
required as a result during such shutdown.
 
   
 
  In the event WCSC fails to provide the coal required in a timely manner, other
than due to an event of force majeure, and Buyer is required to obtain the coal
through alternate means (i.e. using trucks to haul the coal from the mines or
obtaining coal from another company), and Buyer has provided WCSC a reasonable
opportunity to provide coal from other sources or to otherwise address its delay
in a timely manner, WCSC shall be liable to Buyer for the cost difference
between the cost to obtain the coal under the terms of this Order and the cost
actually paid by Buyer to obtain the coal using alternate means, specifically
excluding any incidental or consequential costs or damages.
 
   
DELIVERY DATE & SCHEDULE:
  Buyer and WCSC shall coordinate and agree upon the delivery schedule in a
prompt manner based on the needs of Buyer.
 
   
POINT OF DELIVERY:
  The Point of Delivery for coal sold hereunder shall be F.O.B. Mine, loaded
into Buyer provided railcars. All title and risk of loss shall transfer to Buyer
upon loading into railcars.

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PRICE:
  US $14.32 per ton FOB Mine for deliveries during calendar year 2008 and
US$14.75 per ton FOB Mine for deliveries during calendar year 2009 (as
appropriate, “the Price”).  
 
  In the event, subsequent to December 31, 2007, the supplying Mine(s) has
increased costs in the mining, production, processing, delivery or marketing of
coal under this Order as a result of any new, amended or reinterpreted federal,
state or local law, regulation, rule or order, WCSC shall have the right to
increase the Price in an amount equal to the increased costs. Notwithstanding
the foregoing and in lieu of paying the increased Price, Buyer shall have the
right to elect to terminate this Order upon thirty (30) days prior written to
WCSC.
 
   
QUALITY:
  Typical coal quality specifications are set forth below. Buyer acknowledges
that the quality of actual coal deliveries may vary based on industry standards
from the typical specifications below. All qualities below are on as As-Received
basis.

                          Quality   Rosebud Mine   Absaloka Mine*   Beulah
Mine**
Btu/lb
    8,500       8,650       6,900  
Sulfur
    0.70 %     0.64 %     0.9%-1.0 %
Na20 in Ash
    2.00 %     2.00 %     7%-9 %
Ash
    9.35 %     9.50 %     8%-9 %

     
 
  Notwithstanding the above, WCSC shall cause the Rosebud Mine to make
commercially reasonable efforts to supply coal with a sulfur content of 0.65% or
less.
 
   
 
  The size of the coal provided hereunder shall be two inch by zero inch (2” x
0”) with a maximum oversize of ten percent (10%). WCSC will use commercially
reasonable efforts to maintain a top size not to exceed three inches (3”).

 

*  
Subject to the provisions of Source above.
  **  
Actual quality subject to timing of deliveries relative to mine progression and
availability of various seams.

     
BILLING:
  Buyer will be invoiced for coal to the address shown below unless Buyer
otherwise advises WCSC in writing of a different address to which invoices
should be mailed:
 
   
 
  P.O. Box 11
Richardton, ND 58652
Telephone #: 701-974-3308
Telefax #: 701-974-3309
 
   
PAYMENT:
  Buyer shall pay invoices within ten (10) days after the date of the invoice at
the address provided on the invoices, including by wire if requested by WCSC.
Invoices will be sent every two weeks.
 
   
WEIGHTS:
  The weight of the coal shall be determined by WCSC at the Mine by certified
commercial weigh scale(s).
 
   
PRIOR AGREEMENT:
  This Order #002-2008/2009 replaces and deletes Buyer’s options to extend the
Term beyond December 31, 2007 under Order #001-2007.
 
   
GENERAL TERMS AND CONDITIONS:
  The General Terms and Conditions are as attached.

IN WITNESS WHEREOF, the parties hereto have caused this Order to be executed in
duplicate by their duly authorized representatives as of the day and year first
above written.

                              Buyer: Red Trail Energy, LLC       WCSC:
Westmoreland Coal Sales Company  
 
                           
 
  By:   /s/ Mick J. Miller           By:   /s/ Todd A. Meyer    
 
                           
 
  Title:   President           Title:   President    

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GENERAL TERMS AND CONDITIONS

1.  
Title to and risk of loss of the coal shall pass to Buyer at the Point of
Delivery.
  2.  
The term “force majeure” shall mean any cause beyond the control of the party
affected thereby, such as acts of God, strike, lockout, labor dispute, labor
shortage, fire, flood, war, riot, explosion, accident, car shortage, embargo,
contingencies of transportation, inability to secure supplies or fuel or power,
breakdown of machinery or apparatus, regulation or rule or law of any
governmental authority, or any other cause, whether similar or dissimilar to the
aforestated causes and whether or not foreseen or foreseeable by the parties,
which wholly or partially prevents, interrupts or delays the performance by WCSC
or Buyer of their respective obligations under this Order. A force majeure event
affecting any of WCSC’s suppliers, including its mining contractor, shall be
considered a force majeure event affecting WCSC. Settlement of a strike, lockout
or other labor dispute shall be deemed beyond the control of the party claiming
excuse thereby regardless of the cause of, or the ability of such party to
settle, such dispute.

If because of force majeure either Buyer or WCSC is unable to carry out its
obligations under this Order, except obligations to pay money to the other
party, then the obligations of such party shall be suspended to the extent made
necessary by such force majeure and during its continuance, provided such force
majeure is eliminated insofar as possible and economically practicable with all
reasonable dispatch. Any deficiency in coal tonnage to be delivered under this
Order caused by such force majeure shall not be made up except by mutual consent
of Buyer and WCSC.
  3.  
The coal sold hereunder may not be used at, or reconsigned to, any location
other than Buyer’s facility, without the prior written consent of WCSC.
  4.  
WCSC shall provide for sampling and analysis of the coal at the Mine in
accordance with ASTM standards. Buyer shall have the right to have a
representative present during sampling at any and all times to observe the
sampling process. WCSC will provide to Buyer one ASTM sample for each train
load, and WCSC shall also provide by email to Buyer an electronic copy of WCSC’s
quality analysis for each train load.
  5.  
Failure of the Buyer to pay for coal delivered in accordance with the terms
hereof shall give WCSC the option to (a) suspend further shipments until all
previous shipments are paid for, or (b) cancel the Order upon written notice to
Buyer, provided that Buyer shall have a thirty (30) day cure period after
receipt of a notice of cancellation hereunder. If in the reasonable judgment of
WCSC, Buyer’s ability to perform hereunder has or will become impaired, WCSC
shall have the right, upon notice to Buyer, to suspend further shipments until
WCSC receives adequate assurance of Buyer’s performance, which may include a
prepayment account equal to one month of coal deliveries. If such security is
not furnished within ten (10) days after receipt of such notice, WCSC shall have
the right to cancel this Order upon notice to Buyer.
  6.  
This Order shall not be assigned by either party without the prior written
consent of the other party, which consent shall not be unreasonably withheld.
Notwithstanding the foregoing, either party may assign this Order without such
consent to a parent company, or any other affiliate of the assigning party, or
for purposes of securing indebtedness, but assignor shall continue to be liable
for its performance hereunder.
  7.  
A party’s failure to insist in any one or more instances upon strict performance
of a provision of, or to take advantage of any of its rights under this Order
shall not be construed as a waiver of such provision or right. No default of
either party to this Order in the performance of any of its covenants or
obligations hereunder, except the obligation for payment, shall result in a
right to the other party to cancel this contract unless such defaulting party
shall fail to correct the default within thirty (30) days after written notice
of claim of such default has been given by the party claiming such default.
  8.  
Notice sent by facsimile, first class, certified or registered U.S. Mail, or a
reputable over night courier service, addressed to the party to whom such notice
is given, at the address of such party stated in this Order or to such other
address (or facsimile number) as such party may designate, shall be deemed
sufficient notice in any case requiring notice under this Order.
  9.  
EXCEPT AS EXPRESSLY STATED IN THIS ORDER, WCSC MAKES NO WARRANTIES, WHETHER
EXPRESS OR IMPLIED, WRITTEN OR ORAL, ARISING FROM A COURSE OF DEALING, USAGE OF
TRADE, OR OTHERWISE, REGARDING MERCHANTABILITY, FITNESS FOR A PARTICULAR
PURPOSE, QUALITY, QUANTITY, OR OTHERWISE. Neither party shall be liable for any
punitive, special, incidental or consequential damages (including without
limitation, loss of profits or overhead), based upon breach of warranty or of
contract, negligence or any other theory of legal liability arising out of this
Order; provided, however, such limitation regarding incidental or consequential
damages shall not apply to any liability for third party claims for which WCSC
has indemnified Buyer pursuant to paragraph 12 below, to the extent that Buyer
has liability for such incidental or consequential damages.
  10.  
The terms and conditions set forth in this Order are considered by both Buyer
and WCSC to be CONFIDENTIAL. Neither party shall disclose any such information
to any third party without the advance written consent of the other party,
except where such disclosure may be required by law (including by rule or order
of the Securities and Exchange Commission) or is necessary to assert a claim or
defense in judicial or administrative proceedings, in which event the party
desiring to make the disclosure shall advise the other party in advance in
writing and shall cooperate to the extent practicable to minimize the disclosure
of any such information. If a party believes that any disclosure of the terms of
this Order are required by law, such party shall (i) provide prompt written
notice to the other party, and (ii) take such steps are reasonably available to
minimize the disclosure of the terms of this Order.

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11.  
This Order shall be governed in all respects by the law of the State of Montana,
without regard to its choice of laws provisions.
  12.  
WCSC shall be (i) liable to Buyer for, and (ii) indemnify and save harmless
Buyer from and against any and all claims made or brought by any third party in
respect of, any damage, caused by the negligent acts or omissions of WCSC, to
(a) Buyer’s or its contracted rail carriers’ equipment while on WCSC’s property
except to the extent such damage is caused by the negligence of Buyer or its
contracted rail carrier, and (b) Buyer’s equipment, including mobile railcars
and stationary equipment at Buyer’s coal combustion facility, to the extent said
equipment is damaged due to non-coal material having been interspersed with the
coal prior to leaving WCSC’s mine property.
  13.  
This Order contains the entire agreement of the parties, is expressly limited to
the terms and conditions specifically set forth or incorporated by reference
herein, supersedes all prior communications between the parties regarding the
subject matter of this Order and shall be amended or modified only by agreement
of the parties in writing. Should any provision of this Order for any reason be
declared invalid or unenforceable by an order of any court having jurisdiction,
such decision shall not affect the validity or enforceability of the remaining
provisions of this Order, and such provisions shall remain in full force and
effect as if this Order had been executed without the invalid or unenforceable
provision.

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