Exhibit 10.2


 


WPS Energy Services,
Inc. Gas Sales Agreement


 


WPS
Energy Services, Inc., a Wisconsin corporation, (hereinafter referred to as the
“Seller”) and United Wisconsin
Grain Producers, LLC (hereinafter referred to as the “Buyer”) hereto agree as of April 1, 2004 to
the terms of this Gas Sales Agreement (the “Agreement”) as follows:


 


I. QUANTITY AND PRICE


 


1.1                                Seller agrees to sell and deliver to Buyer,
and Buyer agrees to purchase and receive from Seller, the quantity of Gas
mutually agreed upon and for
the price specified in any Authorization for Sale (Authorization) executed and
effective between the parties.  Sales and
purchases will be on a Firm or Interruptible basis, as specified in the
effective Authorization.


 


1.2                                Buyer and Seller shall use all reasonable efforts
to provide each other with sufficient notice to allow nomination changes to all
Transporters in accordance with the nomination requirements of that
Transporter.  Imbalance and cashout
charges shall be charged to and/or paid by the party causing the imbalance or
in accordance with the effective Authorization.


 


II. DELIVERY POINT


 


2.1                                Seller shall deliver the Gas purchased and sold
hereunder to Buyer at the locations set forth as Delivery Point(s) in the
effective Authorization.


 


III. DEFINITIONS


 


3.1                                As used in the Agreement, “Gas” shall mean
natural gas, which is of merchantable pipeline quality and in conformance with
the quality specification of the receiving pipeline, local distribution company
(utility) or other transporting pipelines.


 


3.2                                “Interruptible” shall mean that either party may interrupt its performance at any time
for any reason, whether or not caused by an event of Force Majeure, with no
liability, except such interrupting party may be responsible for any Imbalance
Charges related to its interruption after the nomination is made to the
Transporter and until the change in deliveries and/or receipts is confirmed by Transporter.  In the event of an interruption, Seller
agrees to assist Buyer in finding alternate fuel.


 


3.3                                “Firm” shall mean that either party may
interrupt its performance without liability only to the extent that such
performance is prevented for reasons of Force Majeure; provided, however, that
during Force Majeure interruptions, the party invoking Force Majeure may be
responsible for any Imbalance Charges related to its interruption after the
nomination is made to the Transporter and until the change in deliveries and/or
receipts is confirmed by the Transporter.


 


3.4                                “Secondary Firm” shall mean that Seller shall
be request to sell and Buyer shall be required to purchase quantities of Gas
set forth herein.  Either party may
interrupt its performance to the extent that such performance is prevented for
reasons of Force Majeure or curtailment of such party’s Firm Secondary
transportation and/or storage between secondary firm points by the delivering pipeline. If a party interrupts for any
other reason the non-breaching party’s exclusive remedy shall be that it may
recover its cost of alternate supply, replacement gas, or market.


 


3.5                                “Imbalance Charges” shall mean any fees,
penalties, costs or charges (in cash or in kind) assessed by a Transporter for
failure to satisfy the Transporter’s balance and/or nomination requirements.


 


3.6                                “Cashout” shall mean any process used by a
Transporter to purchase, sell, or trade natural gas at the end of any delivery period for the purpose of balancing receipts and
deliveries with that Transporter for that delivery period.


 


3.7                                “MMBtu” shall mean one million British
thermal units, which is equivalent to one dekatherm.


 


3.8                                “Transporter(s)” shall mean all Gas
gathering or pipeline companies, or local distribution companies, acting in the
capacity of a transporter, transporting Gas for Seller or Buyer upstream or
downstream, respectively, of the Delivery Point pursuant to a particular
Transaction Confirmation.


 


3.9                                “NYMEX Last Day Settle” shall mean the
expiration price of the natural gas contract on the day that trading of the underlying monthly contract is terminated.


 


IV. BILLING, PAYMENT,
AND FINANCIAL RESPONSIBILITY


 


4.1                                By the tenth (10th) day of each
month, Seller shall submit to Buyer an invoice setting forth the quantity of
Gas purchased by Buyer during
the preceding month and the total due. 
If the actual total quantities purchased are not available by the
invoice date, the invoice will be based on an estimate using nominated
quantities.  Such estimates shall be
adjusted to reflect actual quantities on the following month’s statement or on
the first month’s statement after actual quantities become available.


 










*
Portions omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.


 
















 


4.2                                Except as provided in Section 4.3, Buyer
shall remit payment to Seller for the total amount due by the 20th
day of the month.  Payment shall be made
by check, wire transfer, or EFT for amounts up to $50,000.  Payments larger than $50,000 shall be made by
wire transfer, EFT, ACH, or other method acceptable to Seller.


 


4.3                                If Buyer disputes the amount payable under
any invoice rendered hereunder, Buyer shall pay when due the amount not in
dispute under such invoice as well as provide documentation acceptable in
industry practice to support the amount paid or disputed.  Such payment shall not be deemed to be a
waiver of Buyer’s right to recoup any overpayment, nor shall acceptance of any
payment be deemed to be a waiver of Seller’s right to any underpayment.


 


4.4                                In the event Buyer fails to pay the
undisputed amount due to Seller when due, interest on the unpaid portion of the
undisputed amount shall accrue at a rate equal to one and one half percent (1
1⁄2%) per month, provided that in no event shall such rate exceed the maximum
rate allowed by law, compounded daily from the date such payment is due until
the same is paid. If Buyer fails to pay the undisputed portion of any invoice
rendered hereunder beyond ten (10) days after the due date of such invoice,
then Buyer shall be in default and Seller, in addition to all other legal
remedies available to it, shall have the right to suspend further sales of Gas
until such default has been cured.


 


4.5                                When reasonable grounds for insecurity of
payment or title to the Gas arise, either party may demand adequate assurance
of performance.  Adequate assurance shall
mean sufficient security in the form and for the term reasonably specified by
the party demanding assurance, including, but not limited to, a standby
irrevocable letter of credit, a prepayment, a security interest in an asset
acceptable to the demanding party or a performance bond or guarantee by a
creditworthy entity.  In the event either
party shall (i) make an assignment or any general arrangement for the benefit
of creditors; (ii) default in the payment obligation to the other party; (iii)
file a petition or otherwise commence, authorize, or acquiesce in the
commencement of a proceeding or cause under any bankruptcy or similar law for
the protection of creditors or have such petition filed or proceeding commenced
against it; (iv) otherwise become bankrupt or insolvent (however evidenced); or
(v) be unable to pay its debts as they fall due; then the other party shall
have the right to either without and/or suspend deliveries or payment, or
terminate the Agreement without prior notice, in addition to any and all other
remedies available hereunder.


 


4.6                                Each party shall have the right during
normal business hours to examine the books and records of the other party to
the extent necessary to verify the accuracy of any statement, charge, computation
or demand made under this Agreement. 
Either party shall provide reasonable (in no event less than five (5)
business days) advance notice of any audit.


 


V. TITLE, TAXES


 


5.1                                Seller warrants title to all Gas delivered
hereunder, that it has good and lawful authority to sell the same,
that said Gas is free from liens and adverse claims of every kind.  Title to all Gas delivered hereunder shall
pass from Seller to Buyer at the Delivery Point(s).


 


5.2                                Seller shall pay or cause to be paid all
production, severance or similar taxes lawfully levied on Seller, on the gas,
or on any transaction giving rise to taxes, and applicable to the Gas delivered
hereunder which accrue prior to its delivery to Buyer at the Delivery Point(s),
and Seller shall hold Buyer harmless therefrom. 
Buyer shall pay all taxes lawfully levied on Buyer applicable to such
Gas at and after delivery to the Delivery Point(s) and shall hold Seller
harmless therefrom.  In the event that
sales of Gas hereunder are subject to any local gas revenue, utility, sales or
use taxes which Seller is obligated to remit to any competent taxing authority,
Buyer shall reimburse Seller for any such taxes remitted by Seller in
connection with sales of Gas hereunder. 
Buyer shall provide Seller with evidence of any applicable exemption or
exclusion from sales or other similar taxes, in the appropriate states.


 


VI. TERM, SUCCESSION
AND ASSIGNMENT


 


6.1                                The term of this Agreement shall commence on
the date first mentioned above, with deliveries occurring pursuant to the
delivery term in an effective Authorization. 
Any termination of this Agreement shall not relieve either party of any
obligation incurred hereunder prior to the effective date of termination or any
obligation which specifically extends beyond such date of termination pursuant
to an effective Authorization.


 


6.2                                This Agreement shall be binding upon the
inure to the benefit of the respective heirs, representatives, successors, and
assigns of the parties hereto; however, nether party hereto shall assign its
interests herein to a nonaffiliated entity without having first obtained the
written approval of the other party.


 


VII. FORCE MAJEURE


 


7.1                                In the event either party is rendered
unable, wholly or in part, by Force Majeure to carry out its obligations under
this Agreement, other than to make payments due hereunder, the obligations of
each party, so far as they are affected by such Force Majeure, shall be
suspended during the period of Force Majeure. 
The term “Force Majeure” as employed herein shall mean strikes, lockouts
or other industrial disturbances, acts of God, acts of the public enemy, wars,
blockades, riots, landslides, hurricanes, lightening, earthquakes, fires,


 
















 


floods, washouts, unavoidable freezing of pipes or wells and
explosions, governmental actions such as necessity for compliance with any
court order, law, statute, ordinance, or regulation promulgated by a
governmental authority having jurisdiction or any other unplanned or
non-scheduled occurrence, condition, situation, or threat thereof not covered
above and not involving economic inability, which renders either Buyer or
Seller unable to perform its obligations hereunder, provided such event is
beyond the reasonable control of the party claiming such inability.  The claiming party shall give the other party
notice and full particulars in writing including a specific description of the
cause relied upon and estimated duration of such event as soon as reasonably
possible after the occurrence.


 


VIII. QUALITY AND
MEASUREMENT


 


8.1                                The measurement, testing, heat content, and
quality characteristics of the Gas delivered hereunder shall be governed by the
applicable measurement and testing provisions specified in the FERC tariff or
in the applicable state commission tariff of the Transporter receiving Gas
hereunder at the Delivery Point(s). 
Unless otherwise stated, the heat content of the Gas will be measured on
a dry basis.


 


8.2                                Buyer or Buyer’s transporter(s), at its or
their option, may refuse to accept delivery of any Gas not meeting the quality
specifications.


 


IX. INDEMNIFICATION


 


9.1                                Unless otherwise specifically agreed, title
to the Gas shall pass from Seller to Buyer at the Delivery Point(s).  Seller shall have responsibility for and
assume any liability with respect to the Gas prior to its delivery to Buyer at
the specified Delivery Point(s).  Buyer
shall have responsibility for and any liability with respect to said Gas after
its delivery to Buyer at the Delivery Point(s).


 


9.2                                Seller agrees to indemnify Buyer and save it
harmless from all losses, liabilities or claims including attorneys’ fees and
costs of court, from any and all persons, arising from or out of claims of
title, personal injury or property damage from said Gas or other charges
thereon which attach before title passes to Buyer.  Buyer agrees to indemnify Seller and save it
harmless from all Claims, from any and all persons, arising from or out of
claims regarding payment, personal injury or property damage from said Gas or
other charges thereon which attach after title passes to Buyer.


 


X. WARRANTY AND
DAMAGE DISCLAIMERS


 


10.1                          EXCEPT AS IS EXPRESSLY PROVIDED IN THIS
AGREEMENT, ALL GAS SOLD HEREUNDER IS PROVIDED AS IS AND SELLER EXPRESSLY
DISCLAIMS ALL OTHER WARRANTIES, WHETHER EXPRESS OR IMPLIED, INCLUDING BUT NOT
LIMITED TO ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR PARTICULAR
PURPOSE.


 


10.2                          EXCEPT AS OTHERWISE SPECIFICALLY PROVIDED
HEREIN, IN NO EVENT WILL EITHER PARTY BE LIABLE UNDER THIS AGREEMENT, WHETHER
ARISING UNDER CONTRACT, TORT (INCLUDING NEGLIGENCE AND STRICT LIABILITY), OR
ANY OTHER LEGAL THEORY, FOR INCIDENTAL, CONSEQUENTIAL, SPECIAL, OR PUNITIVE
DAMAGES.


 


XI. MISCELLANEOUS


 


11.1                          The sale of Gas herein is subject to all
applicable federal and state laws, orders, rules and regulations and to the
Federal Energy Regulatory Commission rules and regulations or successor agency
having jurisdiction.  Either party shall
have the right to question or contest any such law, ordinance, order rule, or
regulation.


 


11.2                          If any provision in this Agreement is
determined to be invalid, void or unenforceable by any court having
jurisdiction, such determination shall not invalidate, void, or make
unenforceable any other provision, agreement or covenant of this Agreement.


 


11.3                          This Agreement and any effective
Authorization, together set forth all understandings between the parties
respecting the terms and conditions of any transaction herein described.  All prior agreements, understandings and
representations, whether consistent or inconsistent, oral or written, between
the parties are merged into and superseded by this written Agreement.  No modification or amendment of this
Agreement shall be binding on either party unless in writing and signed by the
parties.


 


11.4                          Any notice, request, demand, statement, bill
or payment provided for in this Agreement, or any notice which a party may
desire to give to the other shall be in writing and if mailed shall be
considered as duly delivered five business days after the postmark date when
mailed by ordinary mail to the other party at the following address.  If delivered by facsimile, any such document
shall be considered delivered on the same business day.


 


	
  Payments by Mail:

  	
  Payments by Wire, EFT, or ACH

  
	
  WPS Energy Services, Inc.

  	
  Firstar Bank Wisconsin

  
	
  P.O. Box 19046

  	
  ABA No.: 075000022

  
	
  Green Bay, WI 54307-9046

  	
  WPS Energy Services, Inc.

  
	
   

  	
  Account No.: 121740451

  



 
















 


11.5                           No failure by either party to enforce any
right, obligation or remedy hereunder shall operate as a waiver of any of the
foregoing, or the waiver of any future right, obligation or remedy, whether of
like or different character or nature.


 


11.6                           The heading throughout this Agreement are
inserted for reference purposes only, and are not to be construed or taken into
account in interpreting the terms and provisions of any Article, not to be
deemed in any way to qualify, modify or explain the effects of any such term or
provision.


 


11.7                           In the event of any conflict or
inconsistency between the terms hereof and the terms of any effective
Authorization, the terms of the Authorization shall control.


 


11.8                           THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF WISCONSIN.


 


11.9                           Each party to this Agreement represents and
warrants that it has full and complete authority to enter into and perform this
Agreement.  Each person who executes this
Agreement on behalf of either party represents and
warrants that is has full and complete authority to do so and that such party
will be bound thereby.


 


IN WITNESS WHEREOF, the parties have duly executed this
Agreement to be effective on the day and year first written above.


 


	
  SELLER: WPS ENERGY SERVICES, INC.

  	
  BUYER: UNITED WISCONSIN GRAIN PRODUCERS,
  LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
  BY:

  	
  /s/ Mark A. Radtke

  	
   

  	
  BY:

  	
  /s/ Kevin Roche

  	
   

  
	
   

  	
   

  
	
  NAME:

  	
  Mark A. Radtke

  	
   

  	
  NAME:

  	
  Kevin Roche

  	
   

  
	
   

  	
   

  
	
  TITLE:

  	
  President

  	
   

  	
  TITLE:

  	
  President

  	
   

  
	
   

  	
   

  
	
  DATE:

  	
  4/24/02

  	
   

  	
  DATE:

  	
  4/20/04

  	
   

  
											



 
















 


Exhibit “A” to Gas
Sales Agreement AUTHORIZATION FOR SALE


 


Attached to and made a part of the Gas Sales Agreement (“Agreement’)
dated April 1, 2004 between WPS ENERGY SERVICES, INC., a Wisconsin corporation,
as Seller, and UNITED WISCONSIN GRAIN PRODUCERS, LLC, as Buyer.


 


SECTION A – AUTHORIZATION SUBJECT TO GAS SALES AGREEMENT 


 


A.1                             By this Authorization, Seller agrees to sell
and Buyer agrees to purchase Buyer’s full requirements of Gas at the Delivery
Points listed below pursuant to the terms of this Authorization and of the Gas
Sales Agreement, unless otherwise agreed to in writing by the Parties.


 


A.2                             If the Parties agree to terms in this
Authorization that modify, change or otherwise conflict with any provisions of
the Gas Sales Agreement, the terms of this Authorization shall govern.


 


SECTION B – SERVICES AND PRICES


 


B.1                               Gas shall be delivered on a Secondary Firm
basis at Randolph and shall be delivered to the city gate delivery point
identified in Section C of this Exhibit A.


 


Seller shall inform Buyer of any constraint days called by the utility and at the
same time advise Buyer of how much gas they have available to burn for that
day.  Such notification to the Buyer from
Seller should be as timely as possible.


 


B.2                               Buyer and Seller may from time to time agree
in writing, which shall include e-mail, or telefacsimile communication, on
fixed price term(s), quantity, price and location.  These agreed upon pricing details, herein referred
to as “Fixed”, shall be agreed to by a Fixed Price Authorization and a Fixed
Price Confirmation which will include the fixed price term, quantity, price and
location.  A fixed price transaction cost
will be included on the Fixed Price Confirmation, Gas priced in this manner
shall be considered to be the first gas through the meter for each month.  Any unused quantities that have an agreed
upon price will be purchased back by the Seller at prevailing market rates.


 


B.3                               Gas price shall be NYMEX Last Day Settle,
unless fixed, plus transportation identified in B.1 of this Exhibit A.  If more commodity is
purchased than transportation, market interruptible transportation will be
applied to the balance of the fixed commodity. 
If transportation is purchased in excess of the fixed commodity, the
balance of the commodity will be priced equal to the NYMEX Last Day
Settle.  Usage beyond that accounted for
in the aforementioned manner will be priced equal to WPS-ESI Market Supply.


 


	
  Delivery Month

  	
   

  	
  Commodity

  Volumes in Dth

  	
   

  	
  Commodity Price/Dth

  	
   

  	
  Transportation

  Volumes in Dth

  	
   

  	
  Transportation

  Price/Dth

  
	
  March 2005 – April 2006

  	
   

  	
  3,000 per day/ per month

  	
   

  	
  NYMEX Last Day Settle, Unless
  Fixed

  	
   

  	
  3,000 per day/ per month

  	
   

  	
  [*]

  



 


B.4                               Balancing Service: Seller agrees to monitor and review all
information provided to the Seller by Buyer and utility regarding Buyer’s daily
usage of gas.  Based on such information,
Seller shall, on a continuous basis, select the appropriate Daily Nomination Quantity
(“DNQ”), and shall make daily nomination adjustments necessary to deliver the
DNQ requested by Buyer.  The Seller
agrees to indemnify Buyer from all scheduling charges which may be assessed by
Buyer’s utility, provided, however, Buyer’s actual usage of gas continues with
the same level of predictability and the Buyer continues to communicate with
the Seller regarding changes in as consumption. 
Balancing service does not include indemnification of penalties charged
by the Buyer’s utility during a constraint day; However,
in the event Seller is negligent with respect to its notification of Buyer,
Seller agrees to indemnity Buyer from penalties resulting from the failure of
notification.


 


Balancing Service price is [*]. 
Price may be automatically adjusted by Seller to reflect costs associated
with any law, statute, or regulation, or any governmental permit or approval
that has been modified, changed, replaced, supplemented or conditioned in a
manner that adversely affects the economic benefits originally


 










*
Portions omitted pursuant to a request for confidential treatment and filed
separately with the Securities and Exchange Commission.


 
















 


intended to accrue to the Seller under this
Agreement.  Prior to making any
adjustment, Seller agrees to provide Buyer with a copy of the particular change
responsible for the adjustment.


 


	
  B.5

  	
  General Notices to the Seller:

  	
   

  	
  General Notices to the Buyer:

  
	
   

  	
  WPS Energy Services, Inc.

  	
   

  	
  United Wisconsin Grain Producers, LLC

  
	
   

  	
  1088 Springhurst Drive

  	
   

  	
  P.O. Box 247

  
	
   

  	
  Green Bay, WI 54304

  	
   

  	
  Friesland, WI 53935

  
	
   

  	
  Phone: (920) 617-6100

  	
   

  	
  Phone: (920) 348-5016

  
	
   

  	
  Direct: (608) 617-6043

  	
   

  	
  Facsimile: (920) 348-5009

  
	
   

  	
  Facsimile: (920) 617-6070

  	
   

  	
  Email: roche@uwgp.com and mail@uwgp.com

  
	
   

  	
  Attention: Leah Howard

  	
   

  	
  Attention: Kevin Roche

  



 


SECTION C – DELIVERY POINT(S)


 


	
  Utility Delivering

  from Citygate

  	
   

  	
  Citygate

  Delivery Point

  	
   

  	
  Buyer Service

  Address

  	
   

  	
  Utility Account

  Number

  	
   

  	
  Utility Meter Number

  	
   

  
	
  Alliant Energy

  	
   

  	
  Randolph

  	
   

  	
  W1231 Tessman Road

  Cambria, WI 53923

  	
   

  	
  To be Determined

  	
   

  	
  To be Determined

  	
   

  



 


SECTION D – TERM OF AUTHORIZATION


 


This
Authorization shall be effective from March 1, 2005 to April 30, 2006 (“Initial
Term”) and shall renew automatically if notice terminating this Authorization
is not given 60 days prior to the end of the Initial Term.  If allowed, to be renewed beyond the Initial
Term, this Authorization shall remain in effect for each successive year until
terminated by either party providing 60 days prior written notice.


 


SECTION E – SPECIAL PROVISIONS


 


E.1                                If Buyer has an existing contract with a
supplier other than the Seller, then Buyer acknowledges and agrees that if
Buyer is obligated to take delivery or make payment to that supplier, Buyer
also remains liable to Seller for all obligations under this Agreement, and,
any enforcement of the other contract does not release Buyer or Seller from
obligations herein.


 


E.2                                Should Buyer and Seller agree
to fix pricing for Nymex and/or Basis, the following shall apply:


 


Gas price shall be NYMEX Last Day Settle, unless Fixed,
plus transportation for the fixed price volumes.  Usage beyond the volumes fixed will be
supplied and priced at WPS-ESI Incremental Market Supply Price.  Any unused volumes shall be purchased back by
the Seller at prevailing market rates.


 


Notwithstanding the term identified in Section D, this Authorization
will remain in effect as long as gas supplies are secured on Buyer’s behalf
under the terms of this Authorization and any Fixed Price Confirmation pursuant
to Section E.2.  Upon receipt of notice
of termination, Seller will not secure additional gas beyond the term of the
current Authorization.


 


E.3                                WPS Energy Services, Inc. will require UWGP
– United Wisconsin Grain Producers, LLC to forward Quarterly updates on the
project status, (i.e. sources and uses of funds statements as well as a
construction budget summary report).  The
first report should be dated June 30, 2004.


 


IN WITNESS WHEREOF, the parties have duly executed this
Agreement to be effective on the day and year first written above.


 


	
  SELLER: WPS ENERGY SERVICES, INC.

  	
  BUYER: UNITED WISCONSIN GRAIN PRODUCERS,
  LLC

  
	
   

  	
   

  
	
  BY:

  	
  /s/ Mark A. Radtke

  	
   

  	
  BY:

  	
  /s/ Kevin Roche

  	
   

  
	
   

  	
   

  
	
  NAME:

  	
  Mark A. Radtke

  	
   

  	
  NAME:

  	
  Kevin Roche

  	
   

  
	
   

  	
   

  
	
  TITLE:

  	
  President

  	
   

  	
  TITLE:

  	
  President

  	
   

  
	
   

  	
   

  
	
  DATE:

  	
  4/24/02

  	
   

  	
  DATE:

  	
  4/20/04