##### Table of Contents



UNITED STATES SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, DC 20549
 FORM 10-KSB
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934.
 FOR THE FISCAL YEAR ENDED DECEMBER 31, 2006
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE
SECURITIES EXCHANGE ACT OF 1934
 FOR THE TRANSITION PERIOD FROM          TO
 COMMISSION FILE NUMBER: 333-133024
 AGASSIZ ENERGY, LLC
  MINNESOTA
    
    80-0130330(State or other jurisdiction
    
    (IRS Employerof incorporation or organization)
    
    Identification No.)
 
 (218) 281-8442
 None
 None
 o
 þ o
 þ
 o þ
 None
   o þ




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##### 



PagePART I
    
    
    1ITEM
1. DESCRIPTION OF BUSINESS
    
    
    1ITEM 2. DESCRIPTION OF PROPERTY
    
    
    27ITEM 3. LEGAL PROCEEDINGS
    
    
    27ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
    
    
    27PART II
    
    
    27ITEM 5. MARKET FOR COMMON EQUITY AND RELATED UNIT HOLDER MATTERS
AND SMALL BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES
    
    
    27ITEM 6. PLAN OF OPERATION
    
    
    28ITEM 7. FINANCIAL STATEMENTS
    
    
    33ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON
ACCOUNTING AND FINANCIAL DISCLOSURE
    
    
    33ITEM 8A. CONTROLS AND PROCEDURES.
    
    
    34ITEMS 8B. OTHER INFORMATION
    
    
    34PART III
    
    
    35ITEM 9. GOVERNORS, EXECUTIVE OFFICERS, PROMOTERS, CONTROL
PERSONS AND CORPORATE GOVERNANCE; COMPLIANCE WITH SECTION 16(a)
OF THE EXCHANGE ACT
    
    
    35ITEM 10. EXECUTIVE COMPENSATION
    
    
    37ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND
MANAGEMENT AND RELATED UNIT HOLDER MATTERS
    
    
    38ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS AND
GOVERNOR INDEPENDENCE
    
    
    39ITEM 13. EXHIBITS
    
    
    40ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES
    
    
    42EXHIBIT 10.11EXHIBIT 10.12EXHIBIT 10.13EXHIBIT 10.14EXHIBIT 10.15EXHIBIT 10.16EXHIBIT 10.17EXHIBIT 10.18EXHIBIT 10.19EXHIBIT 10.20EXHIBIT 31.1EXHIBIT 31.2EXHIBIT 32.1EXHIBIT 32.2




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CAUTIONARY STATEMENTS REGARDING FORWARD-LOOKING STATEMENTS
  
    
    Our ability to obtain needed equity and debt financing;
    
    Our ability to finalize our construction agreements;
    
    Our ability to obtain all of the permits necessary for the construction and operation of the plant;
    
    Projected growth, overcapacity or contraction in the ethanol market in which we operate;
    
    Fluctuations in the price and market for ethanol and distillers grains;
    
    Changes in plant production capacity, variations in actual ethanol and distillers grains production from expectations or technical difficulties in operating the plant;
    
    Availability and costs of products and raw materials, particularly corn and coal;
    
    Changes in our business strategy, capital improvements or development plans for expanding, maintaining or contracting our presence in the market in which we operate;
    
    Costs of equipment;
    
    Changes in interest rates and the availability of credit to support capital improvements, development, expansion and operations;
    
    Our ability to market and our reliance on third parties to market our products;
    
    Our ability to distinguish ourselves from our current and future competition;
    
    Changes to infrastructure, including
 
    
    expansion of rail capacity,
    
    increases in truck fleets capable of transporting ethanol within localized markets,
    
    additional storage facilities for ethanol, expansion of refining and blending facilities to handle ethanol,
    
    growth in service stations equipped to handle ethanol fuels, and
    
    growth in the fleet of FFVs capable of using E85 fuel;
 
    
    Changes in or elimination of governmental laws, tariffs, trade or other controls or enforcement practices such as:
 
    
    national, state or local energy policy;
    
    federal ethanol tax incentives;
    
    legislation mandating the use of ethanol or other oxygenate additives;
    
    state and federal regulation restricting or banning the use of MTBE;
    
    environmental laws and regulations that apply to our plant operations and their enforcement; or
    
    reduction or elimination of tariffs on foreign ethanol.
 
    
    Increased competition in the ethanol and oil industries;
    
    Fluctuations in US oil consumption and petroleum prices;
    
    Changes in general economic conditions or the occurrence of certain events causing an economic impact in the agriculture, oil or automobile industries;
    
    Anticipated trends in our financial condition and results of operations;
    
    The availability and adequacy of our cash flow to meet our requirements, including the repayment of debt;
    
    Our liability resulting from litigation;
· Our ability to retain key employees and maintain labor relations;
    
    Changes and advances in ethanol production technology;
    
    Competition from alternative fuels and alternative fuel additives;
    
    Our reliance on third parties to design, build and operate our plant;
    
    Our reliance on third parties to procure corn and other feedstock and market and sell our ethanol and distillers grains.




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PART I
 
 ITEM
1. DESCRIPTION OF BUSINESS.
 Overview
    Primary Product  Ethanol
   Description of Dry Mill Process
   1




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Source: Renewable Fuels Association (RFA)
       Thermal Oxidation
  2




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Ethanol Markets
  Local ethanol markets
  Regional ethanol markets
    National ethanol markets
    3




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Ethanol Pricing
  
    Co-Products
  4




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Distillers Grains Markets
     Distillers Grains Pricing
  Wet Distillers Grains
  Corn Feedstock Supply
  5




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##### Table of Contents



2006 Grain
    
    2005 Grain
    
    2004 Grain
    
    2003 GrainCorn
    
    Corn
    
    Corn
    
    CornProposed Area
    
    Production
    
    Production
    
    Production
    
    Production(Million
    
    (Million
    
    (Million
    
    (Millionbushels)
    
    bushels)
    
    bushels)
    
    bushels)North Dakota
    
    
    155,400
    
    
    
    154,800
    
    
    
    120,750
    
    
    
    131,040South Dakota
    
    
    312,340
    
    
    
    470,050
    
    
    
    539,500
    
    
    
    427,350Minnesota
    
    
    1,102,850
    
    
    
    1,191,900
    
    
    
    1,120,950
    
    
    
    970,900
     Grain Origination And Risk Management
   6




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Project Location and Proximity to Markets
       7




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Transportation and delivery
   Utilities
   Electricity
  Coal
   8




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Source: U.S. Energy Information Administration, December 15, 2006.
  Natural Gas
  9




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Water
   Employees
   # Full-TimePosition
    
    PersonnelGeneral Manager
    
    
    1Plant Manager
    
    
    1Commodities Manager
    
    
    1Controller
    
    
    1Lab Manager
    
    
    1Lab Technician
    
    
    1Secretary/Clerical
    
    
    2Shift Supervisors
    
    
    4Material Handlers
    
    
    14Maintenance Supervisor
    
    
    1Maintenance Craftsmen.
    
    
    4Plant Operators
    
    
    7TOTAL
    
    
    38
    10




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Sales and Marketing
  Strategic Partners
  Construction and timetable for completion of the project
  Regulatory Permits
    11




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Federal Permits
 Clean Air Act
 
    
    Prevention of Significant Deterioration (PSD) and Construction Permits
    
    Applicable Federal New Source Performance Standards (NSPS)
    
    Applicable National Emission Standards for Hazardous Air Pollutants (NESHAPS)
    
    Title V Operating Permit of the Clean Air Act Amendments of 1990
    
    Risk Management Plan
 Clean Water Act
 
    
    National Pollutant Discharge Elimination System (NPDES)
    
    Oil Pollution Prevention and Spill Control Countermeasures
 Comprehensive Environmental Response Compensation and Liability Act & Community Right to Know Act  (CERCLA/EPCRA)
 
    
    Tier II Forms  listing of potentially hazardous chemicals stored on-site
    
    EPCRA Section 313 and 304 and CERCLA Section 103. These reports track use and release
of regulated substances above threshold and/or designated quantities annually
 Alcohol and Tobacco Tax and Trade Bureau
 
    
    Alcohol Fuel Permit (AFP)
 State Permits
 
    
    Air Quality Permits
    
    Storage Tank Permits
    
    Water Quality Permits
    
    State Liquor License
    
    State Department of Motor Fuels
    
    State Department of Transportation
 
    
    Highway Access Permit
    
    Possible Easement Rights
 
    
    State Department of Health
    
    State Department of Public Service
 
    
    Boiler License
 
    
    State Department of Natural Resources
 
    
    Water appropriation permits
    
    Other waters and wetland considerations
 12




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Synthetic Major permit for air emissions
  Air pollution standard
  Waste Water Discharge Permit
  Storm Water Discharge Permit (NDPES) and Storm Water Pollution Prevention Plan (SWPPP Permits)
 Permit for Industrial Activity:
   13




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Permit for Construction:
  New source performance standards
  Environmental Assessment
  Spill prevention, control, and countermeasures plan
  Tank Permit
  Well Permit
  14




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Alcohol and Tobacco Tax and Trade Bureau, Requirements
  Risk management plan
  Environmental Protection Agency
  Nuisance
 See
  INDUSTRY OVERVIEW
  15




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RenewableYear

    
    fuel usage(in billions of gallons)2006
    
    4.02007
    
    4.72008
    
    5.42009
    
    6.12010
    
    6.82011
    
    7.42012
    
    7.52013 and thereafter
    
    Minimum based on maintaining thesame ratio of renewable fuels togasoline sales as occurred in 2012.In addition, beginning in 2013, thetotal RFS mandated amount ofrenewable fuels will include of 250million gallons of cellulosicethanol.
    16




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Supply of Ethanol
     17




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18




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U.S. Ethanol Production Capacity by State
 Under Construction/Online
    
    
    Expansion
    
    
    TotalIowa
    
    
    1701.5
    
    
    
    1535
    
    
    
    3236.5Nebraska
    
    
    655.5
    
    
    
    965
    
    
    
    1620.5Illinois
    
    
    831
    
    
    
    341
    
    
    
    1172South Dakota
    
    
    532
    
    
    
    378
    
    
    
    910Minnesota
    
    
    541.6
    
    
    
    240.5
    
    
    
    782.1Indiana
    
    
    102
    
    
    
    551
    
    
    
    653Kansas
    
    
    212.5
    
    
    
    295
    
    
    
    507.5Wisconsin
    
    
    230
    
    
    
    272
    
    
    
    502Texas
    
    
    0
    
    
    
    370
    
    
    
    370Ohio
    
    
    3
    
    
    
    330
    
    
    
    333Michigan
    
    
    155
    
    
    
    107
    
    
    
    262North Dakota
    
    
    83.5
    
    
    
    150
    
    
    
    233.5New York
    
    
    0
    
    
    
    164
    
    
    
    164Missouri
    
    
    155
    
    
    
    0
    
    
    
    155Oregon
    
    
    0
    
    
    
    143
    
    
    
    143Colorado
    
    
    85
    
    
    
    40
    
    
    
    125Tennessee
    
    
    67
    
    
    
    38
    
    
    
    105Georgia
    
    
    0.4
    
    
    
    100
    
    
    
    100.4California
    
    
    68
    
    
    
    0
    
    
    
    68Arizona
    
    
    0
    
    
    
    55
    
    
    
    55Washington
    
    
    0
    
    
    
    55
    
    
    
    55Kentucky
    
    
    35.4
    
    
    
    0
    
    
    
    35.4New Mexico
    
    
    30
    
    
    
    0
    
    
    
    30Wyoming
    
    
    5
    
    
    
    0
    
    
    
    5Total
    
    
    5493.4
    
    
    
    6129.5
    
    
    
    11,622.9
 Source:
Renewale Fuels Association, January 2007
 Federal Ethanol Supports
    19




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Our Primary Competition
    20




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Current
    
    Under Construction/Capacity
    
    ExpansionsCompany
    
    Location
    
    Feedstock
    
    (mgy)
    
    (mgy)Abengoa Bioenergy Corp.
    
    York, NE
    
    Corn/milo
    
    
    55Colwich, KS
    
    
    
    
    25Portales, NM
    
    
    
    
    30Ravenna, NE
    
    
    
    
    
    
    
    
    88Aberdeen Energy*
    
    Mina, SD
    
    Corn
    
    
    
    
    
    
    100Absolute Energy, LLC*
    
    St. Ansgar, IA
    
    Corn
    
    
    
    
    
    
    100ACE Ethanol, LLC
    
    Stanley, WI
    
    Corn
    
    
    41Adkins Energy, LLC*
    
    Lena, IL
    
    Corn
    
    
    40Advanced Bioenergy
    
    Fairmont, NE
    
    Corn
    
    
    
    
    
    
    100AGP*
    
    Hastings, NE
    
    Corn
    
    
    52Agra Resources Coop. d.b.a. EXOL*
    
    Albert Lea, MN
    
    Corn
    
    
    40
    
    
    
    8Agri-Energy, LLC*
    
    Luverne, MN
    
    Corn
    
    
    21Alchem Ltd. LLLP
    
    Grafton, ND
    
    Corn
    
    
    10.5Al-Corn Clean Fuel*
    
    Claremont, MN
    
    Corn
    
    
    35
    
    
    
    15Amaizing Energy, LLC*
    
    Denison, IA
    
    Corn
    
    
    40Archer Daniels Midland
    
    Decatur, IL
    
    Corn
    
    
    1,070
    
    
    
    275Cedar Rapids, IA
    
    CornClinton, IA
    
    CornColumbus, NE
    
    CornMarshall, MN
    
    CornPeoria, IL
    
    CornWallhalla, ND
    
    Corn/barleyArkalon Energy, LLC
    
    Liberal, KS
    
    Corn
    
    
    
    
    
    
    110ASAlliances Biofuels, LLC
    
    Albion, NE
    
    Corn
    
    
    
    
    
    
    100Linden, IN
    
    Corn
    
    
    
    
    
    
    100Bloomingburg, OH
    
    Corn
    
    
    
    
    
    
    100Aventine Renewable Energy, LLC
    
    Pekin, IL
    
    Corn
    
    
    207Aurora, NE
    
    CornBadger State Ethanol, LLC*
    
    Monroe, WI
    
    Corn
    
    
    48Big River Resources, LLC*
    
    West Burlington, IA
    
    Corn
    
    
    52
    
    
    
    50^Big River Resources Grinnell, LLC
(joint venture with US Bio) ^
    
    Grinnell, IA
    
    CornBlue Flint Ethanol
    
    Underwood, ND
    
    Corn
    
    
    50Bonanza Energy, LLC
    
    Garden City, KS
    
    Corn/milo
    
    
    
    
    
    
    55Broin Enterprises, Inc.*
    
    Scotland, SD
    
    Corn
    
    
    11Bushmills Ethanol, Inc.*
    
    Atwater, MN
    
    Corn
    
    
    40
 21




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Current
    
    Under Construction/Capacity
    
    ExpansionsCompany
    
    Location
    
    Feedstock
    
    (mgy)
    
    (mgy)Cardinal Ethanol
    
    Harrisville, IN
    
    Corn
    
    
    
    
    
    
    100Cargill, Inc.
    
    Blair, NE
    
    Corn
    
    
    85Eddyville, IA
    
    Corn
    
    
    35Cascade Grain
    
    Clatskanie, OR
    
    Corn
    
    
    
    
    
    
    108CassCo Amaizing Energy, LLC
    
    Atlantic, IA
    
    Corn
    
    
    
    
    
    
    110Castle Rock Renewable Fuels, LLC
    
    Necedah, WI
    
    Corn
    
    
    
    
    
    
    50Center Ethanol Company
    
    Sauget, IL
    
    Corn
    
    
    
    
    
    
    54Central Indiana Ethanol, LLC
    
    Marion, IN
    
    Corn
    
    
    
    
    
    
    40Central Illinois Energy, LLC
    
    Canton, IL
    
    Corn
    
    
    
    
    
    
    37Central MN Ethanol Coop*
    
    Little Falls, MN
    
    Corn
    
    
    21.5Central Wisconsin Alcohol
    
    Plover, WI
    
    Seed corn
    
    
    4Chief Ethanol
    
    Hastings, NE
    
    Corn
    
    
    62Chippewa Valley Ethanol Co.*
    
    Benson, MN
    
    Corn
    
    
    45Commonwealth Agri-Energy, LLC*
    
    Hopkinsville, KY
    
    Corn
    
    
    33Corn, LP*
    
    Goldfield, IA
    
    Corn
    
    
    50Cornhusker Energy Lexington, LLC
    
    Lexington, NE
    
    Corn
    
    
    40Corn Plus, LLP*
    
    Winnebago, MN
    
    Corn
    
    
    44Coshoctan Ethanol, OH
    
    Coshoctan, OH
    
    Corn
    
    
    
    
    
    
    60Dakota Ethanol, LLC*
    
    Wentworth, SD
    
    Corn
    
    
    50DENCO, LLC
    
    Morris, MN
    
    Corn
    
    
    21.5Dexter Ethanol, LLC
    
    Dexter, IA
    
    Corn
    
    
    
    
    
    
    100E Energy Adams, LLC
    
    Adams, NE
    
    Corn
    
    
    
    
    
    
    50E3 Biofuels
    
    Mead, NE
    
    Corn
    
    
    
    
    
    
    24E Caruso (Goodland Energy Center)
    
    Goodland, KS
    
    Corn
    
    
    
    
    
    
    20East Kansas Agri-Energy, LLC*
    
    Garnett, KS
    
    Corn
    
    
    35Elkhorn Valley Ethanol, LLC
    
    Norfolk, NE
    
    Corn
    
    
    
    
    
    
    40ESE Alcohol Inc.
    
    Leoti, KS
    
    Seed corn
    
    
    1.5Ethanol2000, LLP*
    
    Bingham Lake, MN
    
    Corn
    
    
    32Ethanol Grain Processors, LLC
    
    Obion, TN
    
    Corn
    
    
    
    
    
    
    100First United Ethanol, LLC (FUEL)
    
    Mitchell Co., GA
    
    Corn
    
    
    
    
    
    
    100Frontier Ethanol, LLC
    
    Gowrie, IA
    
    Corn
    
    
    60Front Range Energy, LLC
    
    Windsor, CO
    
    Corn
    
    
    40Gateway Ethanol
    
    Pratt, KS
    
    Corn
    
    
    
    
    
    
    55Glacial Lakes Energy, LLC*
    
    Watertown, SD
    
    Corn
    
    
    50
    
    
    
    50Global Ethanol/Midwest Grain Processors
    
    Lakota, IA
    
    Corn
    
    
    95Riga, MI
    
    Corn
    
    
    
    
    
    
    57Golden Cheese Company of California*
    
    Corona, CA
    
    Cheese whey
    
    
    5Golden Grain Energy, LLC*
    
    Mason City, IA
    
    Corn
    
    
    60
    
    
    
    50Golden Triangle Energy, LLC*
    
    Craig, MO
    
    Corn
    
    
    20Grand River Distribution
    
    Cambria, WI
    
    Corn
    
    
    
    
    
    
    40Grain Processing Corp.
    
    Muscatine, IA
    
    Corn
    
    
    20Granite Falls Energy, LLC*
    
    Granite Falls, MN
    
    Corn
    
    
    52Great Plains Ethanol, LLC*
    
    Chancellor, SD
    
    Corn
    
    
    50
 22




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Current
    
    Under Construction/Capacity
    
    ExpansionsCompany
    
    Location
    
    Feedstock
    
    (mgy)
    
    (mgy)Greater Ohio Ethanol, LLC
    
    Lima, OH
    
    Corn
    
    
    
    
    
    
    54Green Plains Renewable Energy
    
    Shenandoah, IA
    
    Corn
    
    
    
    
    
    
    50Superior, IA
    
    Corn
    
    
    
    
    
    
    50Hawkeye Renewables, LLC
    
    Iowa Falls, IA
    
    Corn
    
    
    105Fairbank, IA
    
    Corn
    
    
    115Menlo, IA
    
    Corn
    
    
    
    
    
    
    100Heartland Corn Products*
    
    Winthrop, MN
    
    Corn
    
    
    35Heartland Grain Fuels, LP*
    
    Aberdeen, SD
    
    Corn
    
    
    9Huron, SD
    
    Corn
    
    
    12
    
    
    
    18Heron Lake BioEnergy, LLC
    
    Heron Lake, MN
    
    Corn
    
    
    
    
    
    
    50Holt County Ethanol
    
    O'Neill, NE
    
    Corn
    
    
    
    
    
    
    100Horizon Ethanol, LLC
    
    Jewell, IA
    
    Corn
    
    
    60Husker Ag, LLC*
    
    Plainview, NE
    
    Corn
    
    
    26.5Illinois River Energy, LLC
    
    Rochelle, IL
    
    Corn
    
    
    50Indiana Bio-Energy
    
    Bluffton, IN
    
    Corn
    
    
    
    
    
    
    101Iowa Ethanol, LLC*
    
    Hanlontown, IA
    
    Corn
    
    
    50Iroquois Bio-Energy Company, LLC
    
    Rensselaer, IN
    
    Corn
    
    
    40James Valley Ethanol, LLC
    
    Groton, SD
    
    Corn
    
    
    50KAAPA Ethanol, LLC*
    
    Minden, NE
    
    Corn
    
    
    40Kansas Ethanol, LLC
    
    Lyons, KS
    
    Corn
    
    
    
    
    
    
    55Land O Lakes*
    
    Melrose, MN
    
    Cheese whey
    
    
    2.6Levelland/Hockley County Ethanol, LLC
    
    Levelland, TX
    
    Corn
    
    
    
    
    
    
    40Lincolnland Agri-Energy, LLC*
    
    Palestine, IL
    
    Corn
    
    
    48Lincolnway Energy, LLC*
    
    Nevada, IA
    
    Corn
    
    
    50Liquid Resources of Ohio
    
    Medina, OH
    
    Waste Beverage
    
    
    3Little Sioux Corn Processors, LP*
    
    Marcus, IA
    
    Corn
    
    
    52Marquis Energy, LLC
    
    Hennepin, IL
    
    Corn
    
    
    
    
    
    
    100Marysville Ethanol, LLC
    
    Marysville, MI
    
    Corn
    
    
    
    
    
    
    50Merrick & Company
    
    Golden, CO
    
    Waste beer
    
    
    3MGP Ingredients, Inc.
    
    Pekin, IL
    
    Corn/wheat starch
    
    78Atchison, KSMichigan Ethanol, LLC
    
    Caro, MI
    
    Corn
    
    
    50Mid America Agri Products/Wheatland
    
    Madrid, NE
    
    Corn
    
    
    
    
    
    
    44Mid-Missouri Energy, Inc.*
    
    Malta Bend, MO
    
    Corn
    
    
    45Midwest Renewable Energy, LLC
    
    Sutherland, NE
    
    Corn
    
    
    25Millennium Ethanol
    
    Marion, SD
    
    Corn
    
    
    
    
    
    
    100Minnesota Energy*
    
    Buffalo Lake, MN
    
    Corn
    
    
    18Missouri Ethanol
    
    Laddonia, MO
    
    Corn
    
    
    45Missouri Valley Renewable Energy,
LLC*
    
    Meckling, SD
    
    Corn
    
    
    
    
    
    
    60NEDAK Ethanol
    
    Atkinson, NE
    
    Corn
    
    
    
    
    
    
    44New Energy Corp.
    
    South Bend, IN
    
    Corn
    
    
    102North Country Ethanol, LLC*
    
    Rosholt, SD
    
    Corn
    
    
    20Northeast Biofuels
    
    Volney, NY
    
    Corn
    
    
    
    
    
    
    114
 23




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Current
    
    Under Construction/Capacity
    
    ExpansionsCompany
    
    Location
    
    Feedstock
    
    (mgy)
    
    (mgy)Northeast Missouri Grain, LLC*
    
    Macon, MO
    
    Corn
    
    
    45Northern Lights Ethanol, LLC*
    
    Big Stone City, SD
    
    Corn
    
    
    50Northstar Ethanol, LLC
    
    Lake Crystal, MN
    
    Corn
    
    
    52Northwest Renewable, LLC
    
    Longview, WA
    
    Corn
    
    
    
    
    
    
    55Otter Creek Ethanol, LLC*
    
    Ashton, IA
    
    Corn
    
    
    55Otter Tail Ag Enterprises
    
    Fergus Falls, MN
    
    Corn
    
    
    
    
    
    
    57.5Pacific Ethanol
    
    Madera, CA
    
    Corn
    
    
    35Boardman, OR
    
    Corn
    
    
    
    
    
    
    35Burley, ID
    
    Corn
    
    
    
    
    
    
    50Panda Energy
    
    Hereford, TX
    
    Corn/milo
    
    
    
    
    
    
    100Panhandle Energies of Dumas, LP
    
    Dumas, TX
    
    Corn/Grain Sorghum
    
    
    
    
    30Parallel Products
    
    Louisville, KY
    
    Beverage waste
    
    
    5.4R. Cucamonga, CAPatriot Renewable Fuels, LLC
    
    Annawan, IL
    
    Corn
    
    
    
    
    
    
    100Penford Products
    
    Ceder Rapids, IA
    
    Corn
    
    
    
    
    
    
    45Permeate Refining
    
    Hopkinton, IA
    
    Sugars

&  starches
    
    1.5Phoenix Biofuels
    
    Goshen, CA
    
    Corn
    
    
    25Pinal Energy, LLC
    
    Maricopa, AZ
    
    Corn
    
    
    
    
    
    
    55Pine Lake Corn Processors, LLC*
    
    Steamboat Rock, IA
    
    Corn
    
    
    20Pinnacle Ethanol, LLC
    
    Corning, IA
    
    Corn
    
    
    
    
    
    
    60Plainview BioEnergy, LLC
    
    Plainview, TX
    
    Corn
    
    
    
    
    
    
    100Platinum Ethanol, LLC*
    
    Arthur, IA
    
    Corn
    
    
    
    
    
    
    110Plymouth Ethanol, LLC*
    
    Merrill, IA
    
    Corn
    
    
    
    
    
    
    50Prairie Ethanol, LLC
    
    Loomis, SD
    
    Corn
    
    
    60Prairie Horizon Agri-Energy, LLC
    
    Phillipsburg, KS
    
    Corn
    
    
    40Premier Ethanol
    
    Portland, IN
    
    Corn
    
    
    
    
    
    
    60Pro-Corn, LLC*
    
    Preston, MN
    
    Corn
    
    
    42Quad-County Corn Processors*
    
    Galva, IA
    
    Corn
    
    
    27Red Trail Energy, LLC
    
    Richardton, ND
    
    Corn
    
    
    50Redfield Energy, LLC *
    
    Redfield, SD
    
    Corn
    
    
    
    
    
    
    50Reeve Agri-Energy
    
    Garden City, KS
    
    Corn/milo
    
    
    12Renew Energy
    
    Jefferson Junction, WI
    
    Corn
    
    
    
    
    
    
    130Siouxland Energy & Livestock Coop*
    
    Sioux Center, IA
    
    Corn
    
    
    25
    
    
    
    40Siouxland Ethanol, LLC
    
    Jackson, NE
    
    Corn
    
    
    
    
    
    
    50Sioux River Ethanol, LLC*
    
    Hudson, SD
    
    Corn
    
    
    50Southwest Iowa Renewable Energy, LLC *
    
    Council Bluffs, IA
    
    Corn
    
    
    
    
    
    
    110Sterling Ethanol, LLC
    
    Sterling, CO
    
    Corn
    
    
    42Summit Ethanol
    
    Leipsic, OH
    
    Corn
    
    
    
    
    
    
    60Tall Corn Ethanol, LLC*
    
    Coon Rapids, IA
    
    Corn
    
    
    49Tama Ethanol, LLC
    
    Tama, IA
    
    Corn
    
    
    
    
    
    
    100
 24




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##### Table of Contents



Current
    
    Under Construction/Capacity
    
    ExpansionsCompany
    
    Location
    
    Feedstock
    
    (mgy)
    
    (mgy)Tate & Lyle
    
    Loudon, TN
    
    Corn
    
    
    67
    
    
    
    38Ft. Dodge, IA
    
    Corn
    
    
    
    
    
    
    105The Andersons Albion Ethanol LLC
    
    Albion, MI
    
    Corn
    
    
    55The Andersons Clymers Ethanol, LLC
    
    Clymers, IN
    
    Corn
    
    
    
    
    
    
    110The Andersons Marathon Ethanol, LLC
    
    Greenville, OH
    
    Corn
    
    
    
    
    
    
    110Trenton Agri Products, LLC
    
    Trenton, NE
    
    Corn
    
    
    40United Ethanol
    
    Milton, WI
    
    Corn
    
    
    
    
    
    
    52United WI Grain Producers, LLC*
    
    Friesland, WI
    
    Corn
    
    
    49US BioEnergy Corp.
    
    Albert City, IA
    
    Corn
    
    
    250
    
    
    
    400
    ^Woodbury, MI
    
    CornHankinson, ND
    
    CornCentral City , NE
    
    CornOrd, NE
    
    CornDyersville, IA
    
    CornJanesville, MN
    
    CornU.S. Energy Partners, LLC (White Energy)
    
    Russell, KS
    
    Milo/wheat starch
    
    48Utica Energy, LLC
    
    Oshkosh, WI
    
    Corn
    
    
    48VeraSun Energy Corporation
    
    Aurora, SD
    
    Corn
    
    
    230
    
    
    
    330Ft. Dodge, IA
    
    CornCharles City, IA
    
    CornWelcome, MN
    
    CornHartely, IA
    
    CornVoyager Ethanol, LLC*
    
    Emmetsburg, IA
    
    Corn
    
    
    52Western New York Energy, LLC
    
    Shelby, NY
    
    Corn
    
    
    
    
    
    
    50Western Plains Energy, LLC*
    
    Campus, KS
    
    Corn
    
    
    45Western Wisconsin Renewable Energy, LLC*
    
    Boyceville, WI
    
    Corn
    
    
    40White Energy
    
    Hereford, TX
    
    Corn/Milo
    
    
    
    
    
    
    100Wind Gap Farms
    
    Baconton, GA
    
    Brewery waste
    
    
    0.4Renova Energy
    
    Torrington, WY
    
    Corn
    
    
    5Xethanol BioFuels, LLC
    
    Blairstown, IA
    
    Corn
    
    
    5
    
    
    
    35Yuma Ethanol
    
    Yuma, CO
    
    Corn
    
    
    
    
    
    
    40Total Current Capacity at 114
ethanol biorefineries
    
    
    
    
    
    
    5,633.4Total Under Construction
(80)/Expansions (7)
    
    
    
    
    
    
    
    
    
    
    6,394.9Total Capacity
    
    
    
    
    
    
    12,028.3
 
 *locally-owned
Renewable Fuels Association, updated: March 13, 2007  25




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Competition from Alternative Fuel Additives
  Reports To Security Holders
  26




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##### Table of Contents



ITEM 2. DESCRIPTION OF PROPERTY.
  
 ITEM 3. LEGAL PROCEEDINGS.
  
 ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.
  
 PART II
 
 ITEM
5. MARKET FOR COMMON EQUITY AND RELATED UNIT HOLDER MATTERS AND SMALL
BUSINESS ISSUER PURCHASES OF EQUITY SECURITIES.
 Market Information
    Unit Holders
  27




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Distributions
  
 ITEM 6. PLAN OF OPERATION.
 Overview
       28




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##### Table of Contents



Plan of Operations Until Start-Up of Ethanol Plant
  Project capitalization
   
    
    commence construction of the plant using all or a part of the equity funds raised while
we seek another debt financing source;
    
    hold the equity funds raised indefinitely in an interest-bearing account while we seek
another debt financing source;
    
    return the equity funds, if any, to investors with accrued interest, after deducting the
currently indeterminate expenses of operating our business or partially constructing the
plant before we return the funds.
  29




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Site acquisition and development
  Plant construction and start-up of plant operations
  Trends and Uncertainties Impacting the Ethanol Industry and Our Future Operations
      30




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##### Table of Contents



Trends and Uncertainties Impacting the Corn and Coal Markets and Our Future Cost of Goods Sold
    Employees
  Private Placement to Raise Seed Capital
  31




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Liquidity and Capital Resources
   Equity Financing
   Debt Financing
   Critical Accounting Policies
  32




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Off-Balance Sheet Arrangements.
  Grants, Government Programs and Tax Increment Financing
 Grants
   Governmental Financing
  Minnesota
  USDA
   
 ITEM 7. FINANCIAL STATEMENTS.
  
 ITEM 8. CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND FINANCIAL DISCLOSURES.
  33




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##### Table of Contents



ITEM 8A. CONTROLS AND PROCEDURES.
   Compliance with Section 404 of Sarbanes-Oxley Act
    
 ITEM 8B. OTHER INFORMATION.
  34




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##### Table of Contents



PART III
 
 ITEM 9.
    
    GOVERNORS, EXECUTIVE OFFICERS, PROMOTERS, CONTROL PERSONS; COMPLIANCE WITH SECTION 16(A) OF THE EXCHANGE ACT
  Identification of Governors, Executive Officers and Significant Employees
  Governor and Officer
    
    OfficeDonald Sargeant
    
    Chairman of Board/PresidentLarry Altringer
    
    Governor/TreasurerWayne Wagner
    
    Governor/Vice PresidentGary Bridgeford
    
    GovernorRoger Dziengel
    
    Governor/SecretaryLeroy Reitmeier
    
    GovernorTom Jorgens
    
    GovernorCraig Morgan
    
    GovernorJohn Vallager
    
    GovernorJohn Stone
    
    Vice President
 Business Experience of Governors and Officers
  Donald Sargeant, President, Chairman and Governor.
 Larry Altringer, Treasurer and Governor.
 Wayne Wagner, Vice President and Governor.
 Gary Bridgeford, Governor.
 Roger Dziengel, Secretary and Governor.
 Leroy Reitmeier, Governor.
 Tom Jorgens, Governor.
 35




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##### Table of Contents



Craig Morgan, Governor.
 John Vallager, Governor.
 John D. Stone, Vice President.
 Advisory Board
  Advisory Board Member
    
    CareerCourtney Pulkrabek
    
    Insurance AgentRichard Hanson
    
    Farm OperatorWayne Hoovestol
    
    Trucking/Ethanol OwnerAllan Dragseth
    
    Farm OperatorNancy Hulett Drake
    
    Telecommunications ConsultantLoren Dusterhoft
    
    Petroleum RetailerRoger Paradis
    
    Trucking OwnerArnold G. Paradis
    
    Trucking OwnerWayne Tang
    
    Farm OperatorKelly Engelstad
    
    Food Processing ConsultantThomas Wagner
    
    Retired Farmer/BusinessmanBrad Beyer
    
    Cement Transportation ManagerTimothy Hanson
    
    Telecom ConsultantAllen Brost
    
    Auto RetailerDavid West
    
    Business ConsultantJames Noyes
    
    Food Processing Plant ManagerMerle Anderson
    
    Retired FarmerPeter Haddeland
    
    Bank PresidentDale Dufault
    
    Chief Financial OfficerJohn Bridgeford
    
    Packaging Sales
  Audit Committee
  36




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##### Table of Contents



Code of Ethics
 www.agassizenergy.com .
   
 
 ITEM 10. EXECUTIVE COMPENSATION
   Annual Compensation
    
    Long-Term CompensationRestricted
    
    SecuritiesFiscal
    
    
    
    
    
    
    
    
    
    
    
    
    
    Stock
    
    Underlying
    
    LTIP
    
    All OtherName and Principal Position
    
    Year
    
    Salary
    
    Bonus
    
    Other
    
    Awards
    
    Options/SARS
    
    Payout
    
    CompensationDonald Sargeant(1)
    
    
    2005
    
    
    $
    53,200
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    60,000President
    
    
    2006
    
    
    $
    57,200
 
 (1)
    
    Mr. Sargeant is compensated pursuant to a consulting agreement whereby he is compensated
for his work at a rate of $50.00 per hour.  Employment Agreements
  Reimbursement of Expenses
  37




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##### Table of Contents



ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
 Security Ownership of Certain Beneficial Owners and Management
  UNITS BENEFICIALLY OWNED BY GOVERNORS, OFFICERS AND 5% HOLDERS
 Percentage of TotalAfter the OfferingAmount and
    
    Percent of
    
    Maximum
    
    MinimumNature of
    
    Class
    
    Units
    
    UnitsBeneficial
    
    Prior to
    
    Sold in
    
    Sold inTitle of Class
    
    Name and Address of Beneficial Owner
    
    Owner
    
    Offering
    
    Offering
    
    OfferingMembership Units
    
    Larry Altringer(1)
    
    
    384,000
    
    
    
    8.8
    %
    
    
    *
    
    
    
    *18569 390 St East,Erskine, MN 56535Membership Units
    
    Roger Dziengel
    
    
    120,000
    
    
    
    2.75
    %
    
    
    *
    
    
    
    *2844 150(th) Street,Kennedy, MN 56733Membership Units
    
    Thomas Jorgens
    
    
    24,000
    
    
    
    *
    
    
    
    *
    
    
    
    *309 Leonard Avenue,P.O. Box 552,Crookston, MN 56716Membership Units
    
    Donald Sargeant
    
    
    84,000
    
    
    
    1.9
    %
    
    
    *
    
    
    
    *18548 West UnionTrail SE, Erskine, MN 56535Membership Units
    
    Wayne Wagner
    
    
    24,000
    
    
    
    *
    
    
    
    *
    
    
    
    *25477 Highway 75 SW,Crookston, MN 56716Membership Units
    
    Gary Bridgeford(2)
    
    
    240,000
    
    
    
    5.5
    %
    
    
    *
    
    
    
    *19626 445 Avenue SW,East Grand Forks, MN 56721Membership Units
    
    Leroy Reitmeier
    
    
    288,000
    
    
    
    6.6
    %
    
    
    *
    
    
    
    *34847 255(th) AvenueSW, Crookston, MN 56716Membership Units
    
    Craig Morgan
    
    
    144,000
    
    
    
    3.3
    %
    
    
    *
    
    
    
    *610 Old Highway 75,Crookston, MN 56716Membership Units
    
    John Vallager
    
    
    75,000
    
    
    
    1.7
    %
    
    
    *
    
    
    
    *520 5(th) Ave NE,Crookston, MN 56716Membership Units
    
    Allen Brost
    
    
    240,000
    
    
    
    5.5
    %
    
    
    *
    
    
    
    *1600 University Ave.,PO Box 456,Crookston, MN 56716Membership Units
    
    Wayne Hoovestol(3)
    
    
    480,000
    
    
    
    11
    %
    
    
    *
    
    
    
    *20300 Clayton Avenue,Farmington, MN 55024Membership Units
    
    Monica Hoovestol(4)
    
    
    480,000
    
    
    
    11
    %
    
    
    *
    
    
    
    *20300 Clayton Avenue,Farmington, MN 55024Membership Units
    
    Tang Farms Partnership(12)
    
    
    240,000
    
    
    
    5.5
    %
    
    
    *
    
    
    
    *12433 120(th) Street N.,Felton, MN 56536Membership Units
    
    Thomas Wagner
    
    
    240,000
    
    
    
    5.5
    %
    
    
    *
    
    
    
    *30692 Cone Cove RoadPark Rapids, MN 56470Membership Units
    
    Courtney Pulkrabek
    
    
    480,000
    
    
    
    11
    %
    
    
    *
    
    
    
    *210 North Broadway,Crookston, MN 56716Membership Units
    
    John Stone
    
    
    0
    
    
    
    *
    
    
    
    *
    
    
    
    *11220 Tall Timbers Rd SW,Garfield, MN 56332All governors and
    
    
    1,383,000
    
    
    
    31.7
    %
    
    
    2.1
    %
    
    
    2.9
    %executive officers asa group (10 persons)Total
    
    
    3,063,000
    
    
    
    70.2
    %
    
    
    4.8
    %
    
    
    6.5
    %
 
 *
    
    Less than 1%(1)
    
    Includes 144,000 units held by A & E Partnership.(2)
    
    Includes 75,000 units held by Crookston Jobs, Inc.(3)
    
    Includes 240,000 units held by Monica Hoovestol(4)
    
    Includes 240,000 units held by Wayne Hoovestol 38




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##### Table of Contents



ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
  Transactions with our Governors and Promoters.
     Appointment of Independent Governors and Amendment of Bylaws
 www.agassizenergy.com
 39




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##### Table of Contents



ITEM 13. EXHIBITS
  (1) Financial Statements
  (2) Financial Statement Schedules
  3.1

    Articles of Organization of Agassiz Energy, LLC.*3.2

    Amended and Restated Member Control Agreement of the registrant*3.3

    Amended and Restated Operating Agreement of the registrant*3.4

    Articles of Amendment to Articles of Organization*3.5

    Second Amended and Restated Member Control Agreement*3.6

    Second Amended and Restated Operating Agreement*4.1

    Form of Membership Unit Certificate*4.2

    Form of Subscription Agreement of registrant*4.3

    Impoundment Agreement*10.1

    Option to Purchase Real Property, dated March 16, 2005*10.2

    Option to Purchase Real Property, dated April 30, 2005*10.3

    Option to Purchase Real Property, dated March 11, 2006*10.4

    Value-Added Agricultural Product Market Development Grant Agreement, dated March 14, 2005 between Agassiz Energy,
LLC and the U.S. Department of Agriculture*10.5

    Memorandum of Agreement with Donald Sargeant, dated March 27, 2006.*10.6

    Agreement for Professional Services with Natural Resources Group, dated May 18, 2005.*10.7

    Collaboration Agreement between Agriculture Innovation Center and New Harvest Ethanol dated September S2004.*10.8

    Assignment of Collaboration Agreement between Agriculture Innovation Center and New Harvest Ethanol, dated April
13, 2005.*10.9

    Compensation Agreement for Contact Services dated May 4,2006 between John Stone and Agassiz Energy, LLC.*10.10

    Option to Purchase Real Property, dated July 8, 2006*10.11

    Amended Option to Purchase Real Property with Richard Scott and Dwana Jean Carroll dated November 17, 200610.12

    Form of Warrant given by Agassiz Energy, LLC in connection with the American Federal Bank line of credit10.13

    Form of Promissory Note given by Agassiz Energy, LLC in connection with the American Federal Bank line of credit10.14

    Business Loan Agreement and Promissory Note with American Federal Bank of Crookston, Minnesota dated March 9, 200710.15

    Second Amended Option to Purchase Real Property with Richard Scott and Dwana Jean Carroll dated March 21, 200710.16

    Option to Purchase Real Property with Randy Kroeplin dated March 29, 200710.17

    Amendment/Extension of Option to Purchase Real Property with David M. and Delores R. Czech dated March 30, 200710.18

    Letter exercising right to extend Option to Purchase with Mitch and Hank Thompson dated March 20, 200710.19

    Letter of Intent with KL Process
Design dated April 17, 2007+
 40




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##### Table of Contents



10.20

    Code of Ethics for Senior Financial
Officersb.

    Reports in Form 8-K.November 28, 2006 regarding the Company entering into an Amended Option to Purchase Real Property with Richard Scott and
Dwana Jean Carroll.December 29, 2006 regarding the Companys termination of the following agreements: (i) Memorandum of Understanding dated May
20, 2005 with Bio-Renewable Group; (ii) a General Service Agreement dated March 28, 2006 with Utility Engineering Corporation;
(iii) a License Agreement dated May 1, 2006 with Vogelbusch U.S.A., Inc. and (iv) a Process Guarantee dated May 1, 2006 with
Vogelbusch U.S.A., Inc.March 6, 2007 regarding the Companys issuance of 920,000 warrants to purchase its membership units to six governors
March 6, 2007 regarding the Companys issuance of promissory notes in the aggregate amount of $970,000 to current members in
order to fund a Certificate of Deposit used as collateral for a line of credit at American Federal Bank of Crookston and the
issuance of 1,420,000 warrants to purchase its membership units to 11 members including eight of its governorsMarch 9, 2007 regarding the entering into of an Business Loan Agreement and Promissory Note with American Federal Bank of
Crookston in the principal amount of $970,00031.1

    Certification by Chief Executive Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002 (Rules
13a-14 and 15d-14 of the Securities Exchange Act of
1934).31.2

    Certification by Chief Financial Officer pursuant to
Section 302 of the Sarbanes-Oxley Act of 2002 (Rules
13a-14 and 15d-14 of the Securities Exchange Act of
1934).32.1

    Certification pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.32.2

    Certification pursuant to 18 U.S.C. Section 1350, as
adopted pursuant to Section 906 of the Sarbanes-Oxley
Act of 2002.
 
 *
    
    Filed previously as part of our Registration on Form SB-2 and incorporated herein by
reference.+
    
    Confidential treatment has been requested with respect to
certain portions of this exhibit. Omitted portions have been filed
separately with the Securities and Exchange Commission. 41




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ITEM 14. PRINCIPAL ACCOUNTANT FEES AND SERVICES.
  Audit Fees
  Audit-Related Fees
  Tax Fees
  All Other Fees
  Pre-Approval Policies
  INDEMNIFICATION FOR SECURITIES ACT LIABILITIES
   42




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SIGNATURES
  Dated: April 16, 2007AGASSIZ ENERGY, LLCDONALD SARGEANT/s/ Donald SargeantChairman, President and Governor(Principal Executive Officer)Date: April 16, 2007
  /s/ Donald Sargeant
    
    Chairman, President, Governor
    
    Date: April 16, 2007Donald Sargeant
    
    (Principal Executive Officer)/s/
Larry Altringer
    
    Treasurer, Governor
    
    Date: April 16, 2007Larry Altringer
    
    (Principal Financial and
Accounting Officer)/s/
Wayne Wagner
    
    Vice President and Governor
    
    Date: April 16, 2007Wayne Wagner/s/
Roger Dziengel
    
    Secretary, Governor
    
    Date April 16, 2007Roger Dziengel/s/
Gary Bridgeford
    
    Governor
    
    Date April 16, 2007Gary Bridgeford/s/
Leroy Reitmeier
    
    Governor
    
    Date: April 16, 2007Leroy ReitmeierGovernor
    
    Date: April 16, 2007Tom Jorgens/s/
Craig Morgan
    
    Governor
    
    Date: April 16, 2007Craig Morgan/s/
John Vallager
    
    Governor
    
    Date: April 16, 2007John Vallager




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AGASSIZ ENERGY, LLC




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AGASSIZ ENERGY, LLC
  PageFinancial StatementsReport of Independent Registered Public Accounting Firm
    
    
    F-2Balance Sheet
    
    
    F-3Statement of Operations
    
    
    F-4Statement of Members Equity
    
    
    F-5Statement of Cash Flows
    
    
    F-6Notes to Financial Statements
    
    
    F-7 - F-13
 F-1




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/s/ Boulay, Heutmaker, Zibell & Co. P.L.L.P.Certified Public Accountants
 
 F-2




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AGASSIZ ENERGY, LLC
 
  December 31,ASSETS
    
    2006Current AssetsCash and equivalents
    
    $
    17,257Prepaid and other
    
    
    12,593Total current assets
    
    
    29,850Other AssetsLand options
    
    
    90,000Deferred offering costs
    
    
    337,170Total other assets
    
    
    427,170Total Assets
    
    $
    457,020LIABILITIES AND MEMBERS EQUITYCurrent LiabilitiesTrade accounts payable
    
    
    297,618Accounts payable  members
    
    
    1,775Total current liabilities
    
    
    299,393Commitments and ContingenciesMembers EquityMember contributions, 4,636,500 units outstanding
    
    
    1,545,500Deficit accumulated during development stage
    
    
    (1,387,873
    )Total members equity
    
    
    157,627Total Liabilities and Members Equity
    
    $
    457,020Notes to Financial Statements are an integral part of this Statement.
 F-3




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AGASSIZ ENERGY, LLC
 
  Year Ended
    
    
    Year Ended
    
    
    From InceptionDecember 31,
    
    
    December 31,
    
    
    (October 12, 2004) to2006
    
    
    2005
    
    
    December 31, 2006Revenues
    
    $
    
    
    
    $
    
    
    
    $
    -Operating ExpensesProfessional and consulting fees
    
    
    1,193,782
    
    
    
    451,544
    
    
    
    1,658,075General and administrative
    
    
    31,406
    
    
    
    10,562
    
    
    
    42,463Total operating expenses
    
    
    1,225,188
    
    
    
    462,106
    
    
    
    1,700,538Operating Loss
    
    
    (1,225,188
    )
    
    
    (462,106
    )
    
    
    (1,700,538
    )Other Income (Expense)Grant income
    
    
    147,606
    
    
    
    127,394
    
    
    
    275,000Interest income
    
    
    12,977
    
    
    
    21,636
    
    
    
    37,665Total other income
    
    
    160,583
    
    
    
    149,030
    
    
    
    312,665Net Loss
    
    $
    (1,064,605
    )
    
    $
    (313,076
    )
    
    $
    (1,387,873
    )Weighted Average Units Outstanding
    
    
    4,241,947
    
    
    
    3,000,000
    
    
    
    3,440,580Net Loss Per Unit
    
    $
    (0.25
    )
    
    $
    (0.10
    )
    
    $
    (0.40
    )Notes to Financial Statements are an integral part of this
Statement.
 F-4




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AGASSIZ ENERGY, LLC
 
  DeficitAccumulated duringMember
    
    
    DevelopmentContributions
    
    
    StageBalance  Inception, October 12, 2004
    
    $
    
    
    
    $
    Capital contributions - 3,000,000 units, $.33 per unit, November 2004
    
    
    1,000,000Net loss
    
    
    
    
    
    
    (10,192
    )Balance  December 31, 2004
    
    
    1,000,000
    
    
    
    (10,192
    )Net loss
    
    
    
    
    
    
    (313,076
    )Balance  December 31, 2005
    
    
    1,000,000
    
    
    
    (323,268
    )Capital contributions - 1,636,500 units, $.33 per unit, March 2006
    
    
    545,500Net loss
    
    
    
    
    
    
    (1,064,605
    )Balance  December 31, 2006
    
    $
    1,545,500
    
    
    $
    (1,387,873
    )Notes to Financial Statements are an integral part of this
Statement.
 F-5




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AGASSIZ ENERGY, LLC
 
  Year Ended
    
    
    Year Ended
    
    
    From InceptionDecember 31,
    
    
    December 31,
    
    
    (October 12, 2004) to2006
    
    
    2005
    
    
    December 31, 2006Cash Flows from Operating ActivitiesNet loss
    
    $
    (1,064,605
    )
    
    $
    (313,076
    )
    
    $
    (1,387,873
    )Adjustments to reconcile net loss to net cash
used in operating activities:Expired land option
    
    
    10,000
    
    
    
    
    
    
    
    10,000Changes in assets and liabilitiesRestricted cash
    
    
    61,592
    
    
    
    38,408
    
    
    
    Prepaid and other
    
    
    (9,578
    )
    
    
    37
    
    
    
    (12,593
    )Accounts payable
    
    
    47,011
    
    
    
    56,770
    
    
    
    122,477Net cash used for operating activities
    
    
    (955,580
    )
    
    
    (217,861
    )
    
    
    (1,267,989
    )Cash Flows from Investing ActivitiesPayment for short-term investments
    
    
    
    
    
    
    
    
    
    
    (675,000
    )Proceeds from short-term investments
    
    
    575,000
    
    
    
    100,000
    
    
    
    675,000Payment for land options
    
    
    (90,000
    )
    
    
    (10,000
    )
    
    
    (100,000
    )Net cash provided by (used in) investing activities
    
    
    485,000
    
    
    
    90,000
    
    
    
    (100,000
    )Cash Flows from Financing ActivitiesMember contributions
    
    
    545,500
    
    
    
    
    
    
    
    1,545,500Payments for deferred offering costs
    
    
    (134,723
    )
    
    
    (20,079
    )
    
    
    (160,254
    )Net cash provided by (used in) financing activities
    
    
    410,777
    
    
    
    (20,079
    )
    
    
    1,385,246Net Increase (Decrease) in Cash and equivalents
    
    
    (59,803
    )
    
    
    (147,940
    )
    
    
    17,257Cash and equivalents Beginning of Period
    
    
    77,060
    
    
    
    225,000
    
    
    
    Cash and equivalents End of Period
    
    $
    17,257
    
    
    $
    77,060
    
    
    $
    17,257Supplemental Disclosure of Non-Cash Financing ActivitiesDeferred offering costs in accounts payable
    
    $
    176,916
    
    
    $
    1,178
    
    
    $
    176,916Notes to Financial Statements are an integral part of this
Statement.
 F-6




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##### Table of Contents



AGASSIZ ENERGY, LLC
 
   1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
 Nature of Business
  Accounting Estimates
   Cash and Equivalents
   Property and Equipment
   F-7




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AGASSIZ ENERGY, LLC
   Deferred Offering Costs
  Grants
  Income Taxes
  Organizational and Start Up Costs
  Fair Value of Financial Instruments
  Recently Issued Accounting Pronouncements
  F-8




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##### Table of Contents



AGASSIZ ENERGY, LLC
   2. GOING CONCERN UNCERTAINTIES
    3. INTERIM FINANCING
   4. MEMBERS EQUITY
  F-9




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AGASSIZ ENERGY, LLC
         F-10




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##### Table of Contents



AGASSIZ ENERGY, LLC
   5. INCOME TAXES
  December 31,2006Financial statement basis of total assets
    
    $
    457,020Organizational costs expensed for financial reporting purposes
    
    
    1,425,538Taxable income tax basis of total assets
    
    $
    1,882,558
  6. GRANTS
  
 F-11




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##### Table of Contents



AGASSIZ ENERGY, LLC
   7. COMMITMENTS AND CONTINGENCIES
 Plant Construction
  
 Land Contracts
   F-12




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##### Table of Contents



AGASSIZ ENERGY, LLC
     Consulting Contracts
   8. RELATED PARTY TRANSACTIONS
   F-13