Exhibit 10.7


 


PHASE I AND PHASE II


 


ENGINEERING SERVICES
AGREEMENT


 


BETWEEN


 


HIGHWATER ETHANOL, LLC


 


AND


 


FAGEN ENGINEERING, LLC


 


July 20, 2006















 


TABLE OF CONTENTS


	
  

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 1

  	
   

  	
  Definitions; Rules of Interpretation

  	
   

  	
  1

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  1.1

  	
   

  	
  Rules of Construction

  	
   

  	
  1

  
	
  1.2

  	
   

  	
  Defined Terms

  	
   

  	
  2

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 2

  	
   

  	
  Retention of Agent

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  2.1

  	
   

  	
  Retention of Services

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 3

  	
   

  	
  Engineer Responsibilities

  	
   

  	
  4

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  3.1

  	
   

  	
  Services

  	
   

  	
  4

  
	
  3.2

  	
   

  	
  Phase I Design Package

  	
   

  	
  4

  
	
  3.3

  	
   

  	
  Delivery of Phase I Design Package

  	
   

  	
  4

  
	
  3.4

  	
   

  	
  The Phase II Design Package

  	
   

  	
  4

  
	
  3.5

  	
   

  	
  Delivery of Phase II Design Package

  	
   

  	
  5

  
	
  3.6

  	
   

  	
  Delays

  	
   

  	
  5

  
	
  3.7

  	
   

  	
  Utility Routing and Design Services Limited

  	
   

  	
  5

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 4

  	
   

  	
  Client Responsibilities

  	
   

  	
  5

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  4.1

  	
   

  	
  Client’s Representative

  	
   

  	
  5

  
	
  4.2

  	
   

  	
  Client’s Requirements

  	
   

  	
  6

  
	
  4.3

  	
   

  	
  Other Information

  	
   

  	
  6

  
	
  4.4

  	
   

  	
  Access to Property

  	
   

  	
  6

  
	
  4.5

  	
   

  	
  Review of Documents

  	
   

  	
  6

  
	
  4.6

  	
   

  	
  Consents, Approvals, Licenses, and Permits

  	
   

  	
  6

  
	
  4.7

  	
   

  	
  Bids

  	
   

  	
  6

  
	
  4.8

  	
   

  	
  Other Services

  	
   

  	
  6

  
	
  4.9

  	
   

  	
  Services Outside Scope of Engineer’s Services

  	
   

  	
  6

  
	
  4.10

  	
   

  	
  Deviation from Design

  	
   

  	
  6

  
	
  4.11

  	
   

  	
  Developments Affecting Scope or Timing of Services

  	
   

  	
  7

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 5

  	
   

  	
  Compensation And Payment

  	
   

  	
  7

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.1

  	
   

  	
  Compensation

  	
   

  	
  7

  
	
  5.2

  	
   

  	
  Reimbursement of Engineer Expenses

  	
   

  	
  7

  
	
  5.3

  	
   

  	
  Reimbursement of Subcontractor Expenses

  	
   

  	
  7

  
	
  5.4

  	
   

  	
  Fees for Work Outside Scope of Services

  	
   

  	
  7

  
	
  5.5

  	
   

  	
  Collection of Unpaid Amounts

  	
   

  	
  7

  
	
  5.6

  	
   

  	
  Reimbursement Schedules Subject to Change

  	
   

  	
  7

  
	
  5.7

  	
   

  	
  Invoices

  	
   

  	
  8

  
	
  5.8

  	
   

  	
  Payment

  	
   

  	
  8

  
	
  5.9

  	
   

  	
  Late Payment and Interest

  	
   

  	
  8

  
	
  5.10

  	
   

  	
  Suspension for Failure to Pay

  	
   

  	
  8

  



 



 i
 






 



 


 


	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  5.11

  	
   

  	
  Payment

  	
   

  	
  8

  
	
  5.12

  	
   

  	
  Withholding Payments

  	
   

  	
  8

  
	
  5.13

  	
   

  	
  Purchase Orders

  	
   

  	
  8

  
	
  5.14

  	
   

  	
  Changes in Project

  	
   

  	
  8

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 6

  	
   

  	
  Construction Cost And Cost Estimates

  	
   

  	
  8

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  6.1

  	
   

  	
  Cost Estimates

  	
   

  	
  8

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 7

  	
   

  	
  Termination

  	
   

  	
  9

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  7.1

  	
   

  	
  Termination Upon Default

  	
   

  	
  9

  
	
  7.2

  	
   

  	
  Termination Upon Abandonment of Plant

  	
   

  	
  9

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 8

  	
   

  	
  Ownership of Work Product

  	
   

  	
  9

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  8.1

  	
   

  	
  Work Product

  	
   

  	
  9

  
	
  8.2

  	
   

  	
  Copies Provided to Client

  	
   

  	
  9

  
	
  8.3

  	
   

  	
  Prohibited Use of Work Product

  	
   

  	
  9

  
	
  8.4

  	
   

  	
  Derogation of Engineer’s Rights to Work Product

  	
   

  	
  9

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 9

  	
   

  	
  Successors and Assigns

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  9.1

  	
   

  	
  Successors

  	
   

  	
  10

  
	
  9.2

  	
   

  	
  Written Consent Required

  	
   

  	
  10

  
	
  9.3

  	
   

  	
  No Third-Party Beneficiaries

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 10

  	
   

  	
  Warranty

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  10.1

  	
   

  	
  No Warranty Extended

  	
   

  	
  10

  
	
  10.2

  	
   

  	
  No Responsibility for Construction

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 11

  	
   

  	
  Indemnification

  	
   

  	
  10

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  11.1

  	
   

  	
  Engineer’s Indemnification

  	
   

  	
  10

  
	
  11.2

  	
   

  	
  Client’s Indemnification

  	
   

  	
  11

  
	
  11.3

  	
   

  	
  Hazardous Materials Indemnification

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 12

  	
   

  	
  Dispute Resolution

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  12.1

  	
   

  	
  Arbitration

  	
   

  	
  11

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 13

  	
   

  	
  Confidentiality

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  13.1

  	
   

  	
  Non-Disclosure Obligation

  	
   

  	
  12

  
	
  13.2

  	
   

  	
  Publicity and Advertising

  	
   

  	
  12

  
	
  13.3

  	
   

  	
  Term of Obligation

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Article 14

  	
   

  	
  Miscellaneous

  	
   

  	
  12

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14.1

  	
   

  	
  Governing Law

  	
   

  	
  12

  
	
  14.2

  	
   

  	
  Severability

  	
   

  	
  12

  
	
  14.3

  	
   

  	
  No Waiver

  	
   

  	
  13

  



 



 ii
 






 



 


	
   

  	
   

  	
   

  	
   

  	
  Page

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  14.4

  	
   

  	
  Captions and Headings

  	
   

  	
  13

  
	
  14.5

  	
   

  	
  Engineer’s Accounting Records

  	
   

  	
  13

  
	
  14.6

  	
   

  	
  Counterparts

  	
   

  	
  13

  
	
  14.7

  	
   

  	
  Survival

  	
   

  	
  13

  
	
  14.8

  	
   

  	
  No Privity with Client’s Contractors

  	
   

  	
  13

  
	
  14.9

  	
   

  	
  Amendments

  	
   

  	
  13

  
	
  14.10

  	
   

  	
  Entire Agreement

  	
   

  	
  13

  
	
  14.11

  	
   

  	
  Notice

  	
   

  	
  13

  
	
  14.12

  	
   

  	
  Extent of Agreement

  	
   

  	
  14

  
	
  14.13

  	
   

  	
  Subrogation Waiver

  	
   

  	
  14

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT A

  	
   

  	
  Reimbursement Schedule

  	
   

  	
  16

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT B

  	
   

  	
  Reimbursable Expense Schedule

  	
   

  	
  17

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  EXHIBIT C

  	
   

  	
  Client’s Deliverable Site Obligations

  	
   

  	
  18

  
									



 



 iii














 


PHASE I AND PHASE II


ENGINEERING SERVICES AGREEMENT


THIS PHASE I AND PHASE II ENGINEERING
SERVICES AGREEMENT (the “Agreement”) is made as of
July 20, 2006, (the “Effective Date”) by and between Highwater Ethanol,
LLC, a Minnesota Limited Liability Company (the “Client”) and Fagen
Engineering, LLC a Minnesota Limited Liability Company (the “Engineer”).  Each of the Client and Engineer are referred
to herein individually as a “Party” and collectively as the “Parties.”


RECITALS


WHEREAS,  Client
is developing a 50 million gallons per year dry grind ethanol production
facility to be located in Lamberton, MN (the “Plant”) to be owned and
operated by Client; and


WHEREAS,  Client and Fagen, Inc. (“Design - Builder”)
intend to enter into that certain Lump-Sum Design-Build Agreement (“Design-Build
Agreement”) under which Fagen, Inc., an affiliate of Engineer,  will serve as the design-builder for the
Plant and provide design, engineering, procurement and construction services
for the development and construction of the Plant; and


WHEREAS,   Client wishes to retain an entity in advance
of entering into the Design-Build Agreement to perform certain engineering and
design work that will be required under the Design-Build Agreement on the terms
and conditions set forth in this Agreement, and Engineer desires to act as such
entity upon the terms and conditions set forth in this Agreement.


NOW, THEREFORE, in consideration of the
mutual promises contained herein and other good and valuable consideration, the
receipt and sufficiency of which are hereby acknowledged, and intending to be
legally bound by this Agreement, the parties do hereby agree as follows:


Article 1

Definitions; Rules of Interpretation


1.1          Rules of
Construction.


The
capitalized terms listed in this Article 1 shall have the meanings set forth
herein whenever the terms appear in this Agreement, whether in the singular or
the plural or in the present or past tense. 
Other terms used in this Agreement but not listed in this Article shall
have meanings as commonly used in the English language and, where applicable,
in generally accepted construction and design-build industry standards.  Words not otherwise defined herein that have
well known and generally accepted technical or trade meanings are used herein
in accordance with such recognized meanings. 
In addition, the following rules of interpretation shall apply:


(a)           The
masculine shall include the feminine and neuter.



 1
 






 



(b)                                 References
to “Articles,” “Sections,” “Schedules,” or “Exhibits” shall be to Articles,
Sections, Schedules or Exhibits of this Agreement.


(c)                                  This
Agreement was negotiated and prepared by each of the Parties with the advice
and participation of counsel.  The
Parties have agreed to the wording of this Agreement and none of the provisions
hereof shall be construed against one Party on the ground that such Party is
the author of this Agreement or any part hereof.  The following definitions will apply in this
Agreement:


1.2          Defined Terms.


In
addition to definitions appearing elsewhere in this Agreement, the following
terms have the following meanings:


Agreement
will have the meaning given to such term in the Preamble to this Agreement.


Applicable
Law means


(a)                                  any
and all laws, legislation, statutes, codes, acts, rules, regulations,
ordinances, treaties or other similar legal requirements enacted, issued or
promulgated by a Governmental Authority;


(b)                                 any
and all orders, judgments, writs, decrees, injunctions, Governmental Approvals
or other decisions of a Governmental Authority; and


(c)                                  any
and all legally binding announcements, directives or published practices or
interpretations, regarding any of the foregoing in (a) or (b) of this
definition, enacted, issued or promulgated by a Governmental Authority;


to the extent, for
each of the foregoing in (a), (b) and (c) of this definition, applicable to or
binding upon (i) a Party, its affiliates, its shareholders, its members, it
partners or their respective representatives, to the extent any such person is
engaged in activities related to the Services; or (ii) the property of a Party,
its affiliates, its shareholders, its members, its partners or their respective
representatives, to the extent such property is used in connection with the
Services or an activity related to the Services.


Client
will have the meaning given to such term in the Preamble to this Agreement.


Client’s
Representative will have the meaning given to such term in
Section 4.1


Design-Build
Agreement will have the meaning given to such term in the
Recitals to this Agreement.


Effective
Date will have the meaning given
to such term in the Preamble to this Agreement.


Engineer
will have the meaning given to such term in the Preamble to this Agreement.


Engineer
Responsible Parties will have the meaning given to such term
in Section 4.10.



 2
 






 



Governmental
Approvals will mean any material authorizations or
permissions issued or granted by any Governmental Authority to the Project, the
Client, the Engineer, subcontractors and their affiliates in connection with
any activity related to the Services.


Governmental
Authority will mean any federal, state, local or municipal
governmental body; any governmental, quasi-governmental, regulatory or
administrative agency, commission, body or other authority exercising or
entitled to exercise any administrative, executive, judicial, legislative,
policy, regulatory or taxing authority or power; or any court or governmental
tribunal; in each case having jurisdiction over the Client, the Engineer, the
Plant, or the Site.


Monthly
Invoice will have the meaning given to such term in Section
5.7.


Party
or Parties will have the meaning given to such term in the
Preamble to this Agreement.


Phase
I Deliverables will mean the Client’s deliverable obligations
pursuant to Exhibit C attached to this Agreement.


Phase
I Design Package will have the meaning given to such term in
Section 3.2.


Phase
II Deliverables will mean the Client’s deliverable
obligations pursuant to Exhibit C


Phase
II Design Package will have the meaning given to such term in
Section 3.4 attached to this Agreement.


Plant
will have the meaning given to such term in the Recitals to this Agreement.


Project
will mean the Plant, together with all equipment, labor,
services and materials furnished under the Design-Build Agreement.


Services
will have the meaning given to such term in Section 3.1.


Site
will mean the land or premises on which the Plant is located.


Subcontractor will mean any person or entity,
including but not limited to independent engineers, associates, and
consultants, retained by Engineer, or by any person or entity retained directly
or indirectly by Engineer, in each case as an independent contractor, to
perform a portion of the Services.


Work Product will have the meaning given to
such term in Section 8.1.



 3
 






 



Article 2


Retention
of the Agent


2.1          Retention of Services.  On the terms and subject to the conditions
hereinafter set forth, Client hereby retains Engineer to perform, and Engineer
hereby agrees to perform, the Services. 
Engineer will provide such Services solely pursuant to the terms and
conditions set forth herein including any indemnifications and limitations on
liability.


Article 3


Engineer
Responsibilities


3.1          Services.  Engineer shall perform the Phase I
Design Package and Phase II Design Package engineering services necessary to
facilitate Client’s completion of the Phase I and Phase II Site work required
of Client prior to the issuance of a Notice to Proceed pursuant to the
Design-Build Agreement (collectively, the “Services”).


3.2          Phase I Design
Package. (Grading and Drainage). The Phase I Design Package to be
provided by Engineer shall consist of the engineering and design of the Plant
Site and shall include the following drawings:


a)              Cover
Sheet


b)             Property
Layout Drawing


c)              Grading,
Drainage and Erosion Control Plan Drawing (Multiple Drawings if Required)


i.                 Used
for Land Disturbance Permitting


ii.             Site
grading is held 6-inches low for topsoil and seeding


d)             Roadway
Alignment Drawing


e)              Culvert
Cross Sections and Details (Multiple Drawings)


f)                Seeding
and Landscaping (If Required)


g)             Geometric layout
drawing (includes contractor’s trailer, parking and laydown areas)


Plan sets along
with a Bid Tabulation Sheet will be supplied to the Client so all contractors
bid the same quantities.  A telephone
conference call for a Phase I pre-bid meeting will be provided upon Client’s
request.


3.3          Delivery
of Phase I Design Package.   Engineer
shall deliver the completed Phase I Design Package no later than 60 days after
the receipt of all the Phase I Owner Deliverables, however, the 60 day time
frame will commence no sooner than December 5, 2006.


3.4          Phase II
Design Package.  The Phase II
Design Package to be provided by Engineer shall provide the engineering and
design of Site work and utilities for the Plant, all within the property line
of Plant, and shall consist of the following:


a)              Cover Sheet



 4
 






 



b)             Property
Layout Drawing


c)              Site
Grading and Drainage Drawing (Final Interior Plant Grading)


d)             Roadway
Alignment


e)              Utility
Layout (Fire Loop)


f)                Utility
Layout (Potable Water)


g)             Utility
Layout (Well Water) if using on-Site wells


h)             Utility
Layout (Sanitary Sewer)


i)                 Utility
Layout (Utility Water Blowdown)


j)                 Utility
Layout (Natural Gas)


i.                 Fagen
Engineering provides a preferred routing through the Site, line size and pipe
specifications are typically provided by the gas supplier.


k)              Geometric
Layout (For Project Control Verification)


l)                 Site
Utility Piping Tables Drawing


m)           Tank
Farm Layout Drawing


n)             Tank
Farm Details Drawing


o)             Sections
and Details Drawing (If required)


p)             Miscellaneous Details
Drawing (If required)


A telephone
conference call for a Phase II pre-bid meeting will be provided upon Client’s
request.


3.5          Delivery
of Phase II Design Package.  Engineer
shall deliver the completed Phase II Design Package no later than 60 days after
the receipt of all Phase II Deliverables.


3.6          Delays.  The Parties agree that Engineer
shall not be responsible for delays in providing the Services under this
Agreement due to factors beyond Engineer’s control.


3.7          Utility
Routing and Design Services Limited.  The
Parties agree that Engineer shall provide the routing and design for the
utilities necessary for the Plant only within the Plant property line and up to
the Plant property line, and that, for purposes of this Agreement, Engineer
assumes a tie-in point to a city utility. 
The Parties agree that, if there is no city tie-in point, Engineer will
route the utilities to the Plant property line and stop.  Any special tie-in requirements necessary to
connect the utilities at the Plant property line are not included in the compensation
or the scope of this Agreement and shall only be designed and engineered by
Engineer as change in the Project which affects the Services hereunder.


Article 4


Client
Responsibilities


4.1          Client’s
Representative.  Client shall,
prior to the commencement of Services by Engineer, name a representative (“Client’s
Representative”) with authority to receive information and transmit
instructions for Client.  Client’s
Representative shall be vested with authority to act on behalf of Client and
Engineer shall be entitled to rely on Client’s Representative’s communications
with regard to the Services.



 5
 






 



4.2          Client’s
Requirements.  Client shall,
prior to the commencement of Services by Engineer, provide Engineer with Client’s
requirements for the Project, including objectives and constraints, design and
construction standards, bonding and insurance requirements, and contract forms.


4.3          Other Information.  Prior to the commencement
of Services by Engineer, Client shall provide Engineer with all other
information available to Client and pertinent to the Project and the Services
including, but not limited to, all items required pursuant to Exhibit C.  The items required by Client pursuant to this
Section 4.3 shall be furnished at Client’s expense, and Engineer shall be
entitled to rely upon the accuracy and completeness thereof.


4.4          Access to
Property.   Prior to the commencement of Services and as
necessary during the performance of Services, Client shall arrange for
access by Engineer upon public and private property, as required for the
performance of the Services under this Agreement.


4.5          Review of
Documents.  As related to the
performance of Services hereunder, Client shall examine documents presented by
Engineer, obtain legal and other advice as Client deems appropriate, and render
written decisions within reasonable time. 
The items required by Client pursuant to this Section 4.5 shall be
furnished at Client’s expense, and Engineer shall be entitled to rely upon the
accuracy and completeness thereof.


4.6          Consents,
Approvals, Licenses and Permits.  Prior
to the commencement of Services and as necessary during the performance of the
Services, Client shall obtain all consents, approvals, licenses, permits, and
other Governmental Approvals necessary for the Project and for the performance
of the Services.  The items required by
Client pursuant to this Section 4.6 shall be furnished at Client’s expense, and
Engineer shall be entitled to rely upon the accuracy and completeness thereof.


4.7          Bids.  Client shall advertise for
and open bids when scheduled.


4.8          Other
Services  Client shall furnish all legal,
accounting and insurance counseling services as may be necessary at any time
for the Services, including auditing services the Client may require to verify
the monthly invoices or to ascertain how or for what purposes the Engineer
and/or Subcontractors have used the money paid by or on behalf of the Client.


4.9          Service
Outside Scope of Engineer’s Services.    Client shall, at its own expense, as
necessary for the performance and completions of the Services, provide
any additional services necessary for the Project that are outside the scope of
the Services provided by Engineer under this Agreement.  Engineer shall be entitled to rely upon, as
applicable, the completeness and accuracy of such additional services.


4.10        Deviation
from Design.   Client shall indemnify and hold
harmless Engineer, its employees, its agents, its affiliates, and any other
persons or entities within its control or for whom Engineer would otherwise be
responsible (“Engineer Responsible Parties”) against claims arising out
of Engineer’s design, if there has been, in the completion of the Phase I and
Phase II Site work required of Client prior to the issuance of a Notice to
Proceed pursuant to the Design-Build 



 6
 






 



Agreement, a failure to follow Engineer’s recommendation and such
deviation or failure caused the claims.


 


4.11        Developments
Affecting Scope or Timing of Services.  Client
shall promptly notify Engineer, in writing, when Client learns of contractor
error or any development that affects the scope or timing of Engineer’s
Services.


Article
5


Compensation
and Payment


5.1          Compensation.   In consideration
of its performance of the Services, Client shall pay Engineer for Engineer’s
time in the performance of the Services at a fixed fee of $92,500 (“Fixed Fee”)
as compensation.  Engineer’s compensation
under this Section 5.1 shall be pursuant to the Fee schedule attached hereto as
Exhibit A, as such schedule may be modified from time to time. The full amount
of compensation paid by Client under this Section 5.1 shall be included in and
credited to the Design-Build Agreement’s contract price if entered into upon
payment in full by Client.


5.2          Reimbursement
of Engineer Expenses.    In
addition to the fixed fee in 5.1, Client shall reimburse Engineer for
its expenses related to the performance of the Services in accordance with
Engineer’s current reimbursable expense schedule attached hereto as Exhibit B.


5.3          Reimbursement
of Subcontractor Expenses.


5.3.1       Subcontractor
charges related to time spent in the performance of the Services shall not be
marked-up by Engineer.  Client shall
reimburse Engineer for costs related to Subcontractors’ time in accordance with
the Subcontractors’ invoices for the work.


5.3.2       Subcontractor
reimbursable expenses will be marked up in accordance with the current
reimbursable expense schedule attached hereto as Exhibit B.


5.4          Fees
for Work Outside Scope of Services.  Fees
for all work outside the scope of Engineer’s responsibilities described in
Article 3, including change order work, shall be computed in accordance with
Engineer’s current fee schedules, attached hereto as Exhibits A and B, as such
schedules may be revised from time to time, unless otherwise agreed to in
writing.


5.5          Collection
of Unpaid Amounts.  If
any amount due is not paid in accordance with this Agreement and Engineer must
collect that amount, Engineer shall be entitled to recover, in addition to the
amount due, the cost of collection, including reasonable attorney’s fees in
connection with those collection efforts.


5.6          Reimbursement
Schedules Subject to Change.  Engineer’s reimbursement schedule and
reimbursable expense schedule attached hereto as Exhibits A and B are subject
to change on January 1 of each year.



 7
 






 



5.7          Invoices.  Engineer shall submit a monthly
invoice (“Monthly Invoice”) for Services provided and for reimbursable
expenses incurred by Engineer and any Subcontractors.


5.8          Payment.    Within thirty (30) days after Client’s
receipt of each Monthly Invoice, Client shall pay Engineer all amounts due.


5.9          Late Payment
and Interest.  If Client fails
to make payment within thirty (30) days after receipt of Monthly Invoice,
interest at the maximum legal rate or at an annual rate of 18%, whichever is
less, shall accrue


5.10        Suspension for
Failure to Pay.  If Client
fails to make payment within thirty (30) days after receipt of Monthly Invoice,
Engineer may, at its option, after giving seven (7) days’ written notice,
suspend Services until all amounts due to Engineer by Client have been paid in
full.


5.11        Payments
from Lawful Sources.  Client
shall provide for payment from one or more lawful source of all sums to be paid
Engineer.


5.12        Withholding
Payments.  Engineer’s
compensation shall not be reduced on account of any amounts withheld from
payment to Subcontractors.


5.13        Purchase Orders.  If
Client issues a purchase order or other document to initiate the commencement
of Services hereunder, it is expressly agreed that any terms and conditions
appearing thereon shall have no application and only the provisions of this
Agreement shall apply.


5.14        Changes
in Project.  If Client
requests changes in the Project which affect the Services, compensation for and
time of performance of Engineer’s services shall be adjusted appropriately.


Article 6


Construction
Cost and Cost Estimates


6.1          Cost
Estimates.  Client and
Engineer acknowledge that Engineer has no control over cost of labor,
materials, equipment or services furnished by others, over contractors’ methods
of determining prices, or other competitive bidding or market conditions and
that Engineer’s estimates of Project construction cost will be made on the
basis of its employees’ experience and qualifications and will represent
Engineer’s employees’ best judgment as experienced and qualified professionals,
familiar with the construction industry. 
Engineer does not guarantee that proposal, bids, or actual construction
cost will not vary from its estimates of Project cost and Client acknowledges
the same.



 8
 






 



Article 7


Termination


7.1          Termination
Upon  Default.  Either party may terminate
this Agreement upon twenty (20) days’ written notice if the non-terminating
party has defaulted through no fault of the terminating party.


7.2          Termination
Upon Abandonment of Plant.   Client may terminate Engineer’s obligation to
provide further services upon twenty (20) days’ written notice if Client
abandons development of the Plant.  In
such event, all past due amounts for services rendered (including Subcontractor’s
fees, if any) and any unpaid reimbursable expenses shall be immediately due and
payable by Client.


Article 8


Ownership
of Work Product


8.1          Work
Product.  All tangible
items prepared by Engineer, including but not limited to all drawings,
specifications, calculations, data, notes and other materials and documents,
including electronic data furnished by Engineer to Client and to Subcontractors
under this Agreement  (“Work Product”)
shall be instruments of service, and Engineer 
shall retain the ownership and property interests therein, including the
copyrights thereto.


8.2          Copies
Provided to Client.  Client
may retain copies of Work Product for reference; provided, however, that Client
may not make copies of the Work Product available without Engineer’s written
permission, and, granted such permission, may only do so to the extent the use
of such copies of the Work Product directly pertains to the Services, the
Plant, or the construction thereof. 
Pursuant to Section 8.1 of this Agreement, Engineer retains ownership of
and property interests in any Work Product made available and/or copied.


8.3          Prohibited
Use of Work Product.  Reuse
of the Work Product on any another Project without Engineer’s written consent
is prohibited.  Client shall indemnify
and hold harmless Engineer Responsible Parties against claims resulting from
such prohibited reuse.  Said items are
not intended to be suitable for completion of this Project by others.


8.4          Derogation
of Engineer’s Rights to Work Product.  Submittal
or distribution of Work Product in connection with the performance and
completion of the Services and the construction of the Project does not
constitute publication in derogation of Engineer’s rights and does not in any
way diminish Engineer’s Work Product rights established herein.



 9
 






 



Article 9


Successors
and Assigns


9.1          Successors.  The Parties intend that the
provisions of this Agreement are binding upon the Parties, their employees,
agents, heirs, successors and assigns.


9.2          Written
Consent Required.  Neither
Party shall assign, sublet, or transfer any interest in this Agreement without
written consent of the other; provided, however, that Engineer may employ such
Subcontractors as it may deem appropriate and may transfer or assign any
interest in this Agreement or the Work Product to Design-Builder without
consent of Client.


9.3          No
Third-Party Beneficiaries. 
None of the provisions of this Agreement will be for the benefit of or
enforceable by any person other than the Parties hereto, their successors and
permitted assigns and legal representatives


Article 10


Warranty


10.1        No
Warranty Extended.  Engineer
shall use reasonable care to reflect requirements of all Applicable Laws,
rules, or regulations of which Engineer has knowledge or about which Client
specifically advises in writing, which are in effect on the date of this
Agreement.  ENGINEER INTENDS TO RENDER
SERVICES IN ACCORDANCE WITH GENERALLY ACCEPTED PROFESSIONAL STANDARDS, BUT NO
OTHER WARRANTY IS EXTENDED, EITHER EXPRESS OR IMPLIED, IN CONNECTION WITH SUCH
SERVICES.  Client’s rights and remedies
in this Agreement are exclusive.


10.2        No
Responsibility for Construction.  Engineer
shall not be responsible for construction of the Plant, contractors’
construction means, methods, techniques, sequences, or procedures, or for
contractors’ safety precautions and programs, or for contractors’ failure
according to contract documents.


Article 11


Indemnification


11.1        Engineer’s
Indemnification.  To the
fullest extent permitted by law, Engineer shall indemnify and hold harmless
Client, Client’s officers, directors, partners, employees, and agents from and
against any and all claims for bodily injury and for damage to tangible
property caused solely by the negligent acts or omissions of Engineer or
Engineer Responsible Parties and Engineer’s Engineers in the performance and
furnishing of Engineer’s Services under this Agreement.  Any indemnification shall be limited to the
terms and amounts of coverage of the Engineer’s insurance policies.



 10
 






 



11.2        Client’s
Indemnification.  To
the fullest extent permitted by law, Client shall indemnify and hold harmless
Engineer, Engineer’s officers, directors, partners, employees, and agents and
Engineer’s Engineers from and against any and all claims for bodily injury and
for damage to tangible property caused solely by the negligent acts of omission
of Client or Client’s officers, directors, partners, employees, agents, and
Client’s Engineers with respect to this Agreement or the Project.


11.3        Hazardous Materials Indemnification. In addition to the
indemnity provided under this section, and to the fullest extent permitted by
law, Client shall indemnify and hold harmless Engineer and its officers,
directors, partners, employees, and agents and Engineer’s Engineers from and
against all claims, costs, losses, and damages (including but not limited to
all fees and charges of engineers, architects, attorneys, and other
professionals and all court or arbitration or other dispute resolution costs)
caused by, arising out of, or relating to the presence, discharge, release, or
escape of asbestos, PCBs, petroleum, hazardous waste, or radioactive materials
at, on, under, or from the Site.


Article
12


Dispute
Resolution


12.1        Arbitration.  In an effort to resolve any
conflicts that arise out of or relate to this Agreement, the Client and the Engineer
agree that all disputes shall be submitted first to nonbinding mediation.  If mediation does not resolve the conflicts,
the controversy shall be decided by final and binding arbitration conducted in
Minneapolis, Minnesota in accordance with the Construction Industry Arbitration
Rules of the American Arbitration Association then in effect, unless the
Parties mutually agree otherwise.


The award of the arbitrator(s)
shall be final and binding upon the Parties without the right of appeal to the
courts.  Judgment may be entered upon it
in accordance with Applicable Law by any court having jurisdiction thereof.


Engineer and Client expressly
agree that any arbitration pursuant to this Section 12.1 may be joined or
consolidated with any arbitration involving any other person or entity (i)
necessary to resolve the claim, dispute or controversy, or (ii) substantially
involved in or affected by such claim, dispute or controversy.  Both Engineer and Client will include appropriate
provisions in all contracts they execute with other parties in connection with
the Services to require such joinder or consolidation.


The prevailing
Party in any arbitration, or any other final, binding dispute proceeding upon
which the Parties may agree, shall be entitled to recover from the other Party
reasonable attorneys’ fees and expenses incurred by the prevailing Party.



 11














 


 


Article 13



Confidentiality


13.1        Non-Disclosure
Obligation.  Except as required by court order, subpoena,
or Applicable Law, neither Party shall disclose to third parties any
confidential or proprietary information regarding the other Party’s business
affairs, finances, technology, processes, plans or installations, product
information, know-how, or other information that is received from the other
Party pursuant to this Agreement or the Parties’ relationship prior thereto or
is developed pursuant to this Agreement, without the express written consent of
the other Party, which consent shall not be unreasonably withheld.  The Parties shall at all times use their
respective reasonable efforts to keep all information regarding the terms and
conditions of this Agreement confidential and shall disclose such information
to third Persons only as reasonably required for the permitting of the Project;
financing the development, construction, ownership, operation and maintenance
of the Plant; or as reasonably required by either Party for performing its
obligations hereunder and if prior to such disclosure, the disclosing Party
informs such third Persons of the existence of this confidentiality obligation
and only if such third Persons agree to maintain the confidentiality of any
information received.  This Article 13
shall not apply to information that was already in the possession of one Party
prior to receipt from the other, that is now or hereafter becomes a part of the
public domain through no fault of the Party wishing to disclose, or that
corresponds in substance to information heretofore or hereafter furnished by
third parties without restriction on disclosure.


13.2        Publicity and
Advertising.  Neither Client
nor Engineer shall make or permit any of their subcontractors, agents, or
vendors to make any external announcement or publication, release any
photographs or information concerning the Project or any part thereof, or make
any other type of communication to any member of the public, press, business
entity, or any official body which names the other Party unless prior written
consent is obtained from the other Party, which consent shall not be
unreasonably withheld.


13.3        Term of
Obligation.  The
confidentiality obligations of the Parties pursuant to this Article 13
shall survive for a period five (5) years following the later to occur of
termination of this Agreement or completion of the Plant.


Article 14



Miscellaneous


14.1        Governing Law.  This Agreement shall be governed
by and construed and enforced in accordance with, the substantive laws of the
state of Minnesota, without regard to the conflict of laws provisions thereof.


14.2        Severability.  If any provision or any part of a provision of
the Agreement shall be finally determined to be superseded, invalid, illegal,
or otherwise unenforceable pursuant to any applicable Legal Requirements, such
determination shall not impair or otherwise affect the



 12
 






 



 


validity, legality, or enforceability of the remaining provision or
parts of the provision of the Agreement, which shall remain in full force and
effect as if the unenforceable provision or part were deleted.


14.3        No Waiver.  The failure of either Engineer or
Client to insist, in any one or more instances, on the performance of any of
the obligations required by the other under this Agreement shall not be
construed as a waiver or relinquishment of such obligation or right with
respect to future performance.


14.4        Captions and Headings.  The table of contents and the
headings used in this Agreement are for ease of reference only and shall not in
any way be construed to limit, define, extend, describe, alter, or otherwise
affect the scope or the meaning of any provision of this Agreement.


14.5        Engineer’s
Accounting Records. 
Records of Engineer’s personnel time, reimbursable expenses, and
accounts between parties shall be maintained on a generally recognized
accounting basis.


14.6        Counterparts.  This Agreement may be executed in one or more
counterparts, each of which shall be deemed an original and all of which
together shall be deemed one and the same Agreement, and may be executed and
delivered by facsimile signature, which shall be considered an original.


14.7        Survival.  Notwithstanding any provisions
herein to the contrary, the Work Product provisions set forth in Article 8 and
the indemnity obligations set forth herein shall survive (in full force) the
expiration or termination of this Agreement, and shall continue to apply to the
Parties to this Agreement even after termination of this Agreement or the
transfer of such Party’s interest in this Agreement.


14.8        No Privity with Client’s Contractors.  Nothing in this
Agreement is intended or deemed to create any legal or contractual relationship
between Engineer and any Client contractor or subcontractor retained to perform
the Phase I and Phase II Site work required of Client prior to the issuance of
a Notice to Proceed pursuant to the Design-Build Agreement.


14.9        Amendments.  This Agreement may not be changed,
altered, or amended in any way except in writing signed by a duly authorized
representative of each Party.


14.10      Entire Agreement.  This Agreement consists of the
terms and conditions set forth herein, as well as the Exhibits hereto, which
are incorporated by reference herein and made a part hereof.  This Agreement sets forth the full and
complete understanding of the Parties as of the Effective Date with respect to
the subject matter hereof.


14.11      Notice.  Whenever the Agreement requires
that notice be provided to a Party, notice shall be delivered in writing to
such party at the address listed below. 
Notice will be deemed to have been validly given if delivered (i) in
person to the individual intended to receive such notice, (ii) by registered or
by certified mail, postage prepaid to the address indicated in the



 13
 






 



 


Agreement within four (4) days after being sent, or (iii) by facsimile,
by the time stated in a machine-generated confirmation that notice was received
at the facsimile number of the intended recipient.


If to Engineer, to:


Fagen Engineering LLC

501 W. Highway 212

P. O. Box 159

Granite Falls, MN  56241

Attention: John Austgen

Fax:  (320) 564-4861


with a copy to:


Fagen, Inc.

501 W. Highway 212

P. O. Box 159

Granite Falls, MN  56241

Attention: Bruce Langseth

Fax:  (320) 564-3278


If to Client, to:


Highwater Ethanol, LLC

30427 County Highway 10

Vesta, MN 56292

Attention: Brian Kletscher


14.12      Extent of
Agreement.  This Agreement and
the Exhibits incorporated therein represent the entire agreement between the
Parties and may be amended only by written instrument signed by both Parties.


14.13      Subrogation
Waiver.  The Parties
waive all rights against each other, and against the contractors, Engineers,
agents, and employees of the other for damages covered by any property
insurance during construction, and each shall require similar waivers from
their contractors, Engineers, and agents.



 14
 






 



 


IN
WITNESS WHEREOF, the Parties hereto have caused their names
to be hereunto subscribed by their officers thereunto duly authorized,
intending thereby that this Agreement shall be effective as of this July 20,
2006.


	
  HIGHWATER ETHANOL, LLC

  	
   

  	
  FAGEN ENGINEERING, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By: 

  	
    /s/ Brian Kletscher

  	
   

  	
   

  	
  By:

  	
    /s/
  John Austgen

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Title:

  	
    President

  	
   

  	
   

  	
  Title:

  	
    Senior Vice President

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Address for
  giving notices:

  	
   

  	
  Address for giving notices:

  
	
   

  	
   

  	
   

  
	
  30427 County
  Highway 10

  	
   

  	
  501 West Highway 212

  
	
  Vesta, MN 56292

  	
   

  	
  PO Box 159

  
	
   

  	
   

  	
  Granite Falls, MN 
  56241

  
									



 



 15
 






 



EXHIBIT
A


FAGEN
ENGINEERING LLC


Fee
Schedule FY 2006


CONFIDENTIAL




	
  TYPICAL ASSIGNMENT

  	
   

  	
  BILLING

  CLASS

  	
   

  	
  BILLING RATE

  	
   

  
	
  Clerical / CADD
  Operator

  	
   

  	
  1

  	
   

  	
  $

  	
  32.40

  	
   

  
	
  Clerical / CADD
  Operator

  	
   

  	
  2

  	
   

  	
  $

  	
  50.01

  	
   

  
	
  CADD Operator /
  Designer

  	
   

  	
  3

  	
   

  	
  $

  	
  64.76

  	
   

  
	
  CADD Operator /
  Designer / Engineer

  	
   

  	
  4

  	
   

  	
  $

  	
  80.94

  	
   

  
	
  Designer /
  Engineer / PM

  	
   

  	
  5

  	
   

  	
  $

  	
  97.48

  	
   

  
	
  Engineer /
  Senior Engineer / PM

  	
   

  	
  6

  	
   

  	
  $

  	
  113.83

  	
   

  
	
  Senior Engineer
  / PM

  	
   

  	
  7

  	
   

  	
  $

  	
  130.38

  	
   

  
	
  Senior Engineer
  / PM

  	
   

  	
  8

  	
   

  	
  $

  	
  146.56

  	
   

  
	
  Senior Engineer
  / PM / Principal

  	
   

  	
  9

  	
   

  	
  $

  	
  163.10

  	
   

  
	
  PM / Principal

  	
   

  	
  10

  	
   

  	
  $

  	
  179.45

  	
   

  
	
  Principal

  	
   

  	
  11

  	
   

  	
  $

  	
  195.80

  	
   

  
	
  Principal

  	
   

  	
  12

  	
   

  	
  $

  	
  212.18

  	
   

  
	
  Principal

  	
   

  	
  13

  	
   

  	
  $

  	
  228.52

  	
   

  






 


Subject
to Revision January 1, 2007



 16
 






 



 


EXHIBIT
B


Fagen
Engineering LLC

Reimbursable Expense Billing Schedule


Effective
January 1, 2006


CONFIDENTIAL


	
  Expense Code

  	
   

  	
  Expense Description

  	
   

  	
  Billing Rate

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  BCA

  	
   

  	
  Blackline Print
  Copy – A

  	
   

  	
  $

  	
  1.00

  	
   

  
	
  BCB

  	
   

  	
  Blackline Print
  Copy – B

  	
   

  	
  $

  	
  1.00

  	
   

  
	
  BCC

  	
   

  	
  Blackline Print
  Copy – C

  	
   

  	
  $

  	
  1.25

  	
   

  
	
  BCD

  	
   

  	
  Blackline Print
  Copy – D

  	
   

  	
  $

  	
  1.90

  	
   

  
	
  BCE

  	
   

  	
  Blackline Print
  Copy – E

  	
   

  	
  $

  	
  3.70

  	
   

  
	
  BOA

  	
   

  	
  Paper Print
  Original – A

  	
   

  	
  $

  	
  1.25

  	
   

  
	
  BOB

  	
   

  	
  Paper Print
  Original – B

  	
   

  	
  $

  	
  1.55

  	
   

  
	
  BOC

  	
   

  	
  Paper Print
  Original – C

  	
   

  	
  $

  	
  1.90

  	
   

  
	
  BOD

  	
   

  	
  Paper Print
  Original – D

  	
   

  	
  $

  	
  2.20

  	
   

  
	
  BOE

  	
   

  	
  Paper Print
  Original – E

  	
   

  	
  $

  	
  4.40

  	
   

  
	
  DISK

  	
   

  	
  Floppy Disk
  31⁄2”/ea

  	
   

  	
  $

  	
  2.50

  	
   

  
	
  FAX

  	
   

  	
  Fax Machine
  Usage/Page

  	
   

  	
  $

  	
  1.20

  	
   

  
	
  LD

  	
   

  	
  Long Distance
  Phone Calls

  	
   

  	
  cost plus 10% markup

  	
   

  
	
  LODGING

  	
   

  	
  Lodging

  	
   

  	
  cost plus 10% markup

  	
   

  
	
  MEALS

  	
   

  	
  Meal Expense

  	
   

  	
  cost plus 10% markup

  	
   

  
	
  MILEAGE

  	
   

  	
  Mileage/Mile

  	
   

  	
  $

  	
  .485

  	
   

  
	
  PC1

  	
   

  	
  Photocopies
  81⁄2x11 (<100)/ea

  	
   

  	
  $

  	
  .24

  	
   

  
	
  PC2

  	
   

  	
  Photocopies
  11x17/ea

  	
   

  	
  $

  	
  .50

  	
   

  
	
  PC3

  	
   

  	
  Photocopies
  8(1/2)x11 (>100)/ea

  	
   

  	
  $

  	
  .17

  	
   

  
	
  PO

  	
   

  	
  Postage

  	
   

  	
  cost plus 10% markup

  	
   

  
	
  PROSVC

  	
   

  	
  Outside
  Professional Services

  	
   

  	
  Cost

  	
   

  
	
  PROSVCEXP

  	
   

  	
  Outside
  Professional Services Expenses

  	
   

  	
  cost plus 10% markup

  	
   

  
	
  FLM

  	
   

  	
  Film &
  Developing

  	
   

  	
  cost plus 10% markup

  	
   

  
	
  SPECCOV

  	
   

  	
  Specification
  Book - Cover & Binder/ea

  	
   

  	
  $

  	
  3.15

  	
   

  
	
  TRANS

  	
   

  	
  Transportation

  	
   

  	
  cost plus 10% markup

  	
   

  
	
  UPS

  	
   

  	
  Delivery Service
  Charges

  	
   

  	
  cost plus 10% markup

  	
   

  
	
  VELLUM

  	
   

  	
  Original
  Print/square foot

  	
   

  	
  $

  	
  3.15

  	
   

  



 


Subject
to Revision January 1, 2007



 17
 






 



 


EXHIBIT C


Client’s
Deliverable Site Obligations


Phase
I Deliverables


Prior
to Engineer’s commencement of the Phase I Design Package work, the Client shall
provide Engineer with the following Phase I Deliverables:


1.               A legal description
of the Site


2.               Temporary and
permanent easements, zoning, and other requirements and encumbrances affecting
land use or necessary to permit the proper design and construction of the
Project and enable Design-Builder to perform the Work


3.               To the extent
available, as-built and record drawings of any existing structures at the Site


4.               Environmental
studies, reports and impact statements describing the environmental conditions,
including Hazardous Conditions, in existence at the Site


5.               Topographic Survey
to one (1) foot contours including property boundaries and at least two (2)
benchmarks including existing service and utility lines.


6.               Any special sizing
or other requirements for ethanol storage tank farm.


7.               Preliminary
approval from Client’s Rail service provider of rail design as prepared by
Client’s Rail Designer.


8.               Preliminary
location and design of administration building.


9.               Client’s written
approval of final site layout including rail design and environmental
permitting emission points.


10.         Soil borings logs for all
soil borings complete at Engineer’s specified locations.


11.         Geotechnical Report
regarding subsurface conditions with Client’s Geotechnical Engineer’s
recommendations from Engineer approved Geotechnical Engineer (Terracon is
preferred) including soil borings, and any other surveys or information
available describing other latent or concealed physical conditions at the Site.


12.         Review, comment, and
written approval of Client’s air permit application.


13.         Owner is required to
provide approval of and understand the cost implications of the soil
stabilization and foundation systems required for the project.  This approval will be based on the
recommendations of the geotechnical and structural engineers.


14.         Location and form for
delivery of temporary electrical service.


15.         On-site location for
Storm Water discharge.


16.         Preliminary NPDES
discharge location for water discharges from utility discharges including, but
not limited to the water pre-treatment system, water softeners, and cooling
tower blowdown.


17.         Preliminary indication of
source, analysis, and location of Client’s water supply.


18.         Client’s risk insurance
provider’s specific requirements for fire protection or approval to design fire
protection to Liberty Insurance standards.



 18
 






 



 


Phase
II Deliverables


Prior
to Engineer’s commencement of the Phase II Design Package work, the Client
shall provide Engineer with the following Phase II Deliverables:


1.               Final location,
source and quality of Client’s water supply.


2.               Off-site utility
tie-in locations at or near the property lines (this includes, but is not
limited to, gas supply, electrical supply, water supply if no on-site wells,
on-site or off-site sanitary sewer)


3.               Final NPDES
discharge location for Utility Water Blowdown.


4.               An insurance
provider to allow the proper positioning and number of required hydrants and
hydrants with monitors.


5.               Written approval of
final rail design from the Client’s rail service provider.


6.               Final location and
design (general arrangement) of the Client’s administration building.


7.               Final water
pre-treatment design and operating parameters.


8.               Design and location
of sanitary sewer discharge point of septic system.


9.               Provide
verification that an application for a permit has been made for the
construction of a lined settling pond with wetland discharge for receiving the
ethanol plant non-contact waste streams and filter backwash (if
applicable).  The settling pond maybe
required for meeting the NPDES discharge limits set forth by the state.  This application process can take in excess
of 6 months.  Owner is required to apply
for this settling pond permit.  A
determination will be made upon receipt of the NPDES permit on whether or not
the settling pond is required for the project.



 19