**Exhibit 10.6**

** **

**ELECTRIC SERVICE AGREEMENT**

** **

This Agreementis made as of October 3, 2003, by and between Adams-Columbia ElectricCooperative, of Friendship, Wisconsin (“ACEC” or the “Cooperative”), and UnitedWisconsin Grain Producers (“UWGP” or “Member”).

 

# **PREMISES**

# ** **

1.                                       TheCooperative supplies electric power and energy on a cooperative basis to itsmembers in and around Adams, Marquette, Waushara, Columbia, and other adjacentcounties in central Wisconsin, and wishes to provide electric power and energyto Member upon the terms stated in this Agreement.

 

2.                                       UWGPwishes to be a member of the Cooperative and obtain from the Cooperative, on acooperative basis, electric power and energy for the Member’s Friesland ethanolplant located on the NW 1⁄4 section 27, T13N, R12E (Randolph Township) inColumbia County, Wisconsin, (hereafter referred to as the “Site”) upon theterms to be stated in this Agreement.

 

3.                                       Memberfurther wishes to have the Cooperative request transmission service from theappropriate transmission providers and to own, operate, and maintain asubstation and appurtenant facilities to supply power to the Site upon theterms to be stated in this Agreement.

 

4.                                       ThisAgreement states the terms of the Agreement between the parties, assupplemented by the Bylaws, policies, rules, and regulations of theCooperative, as they may be modified from time to time, which are incorporatedherein by reference.

 

# **AGREEMENT**

# ** **

In consideration of the abovepremises, and for other good and valuable consideration, the parties agree asfollows:

 

**1.****                                      SPECIFICSERVICE REQUIREMENTS AND FACILITIES**

 

UWGP selected ACEC to provideservice to UWGP’s proposed ethanol plant near Friesland, Wisconsin.  Said facility was located more than 500’from the existing local service distribution lines of both ACEC and AlliantEnergy/WP&L.  Member acknowledgesthat it had the opportunity to receive service from either ACEC or AlliantEnergy/WP&L, and chose ACEC to supply electric service as permitted bylaw.  Electric service will be suppliedto UWGP at both 4,160 volt (nominal) and 277/480 volt (nominal) services on thesite provided by UWGP.

 

1.1                                 Cooperative-ownedfacilities and equipment.  ACEC willarrange for transmission service to the site with the American TransmissionCompany, LLC (ATCLLC) at a capacity level not less than ten (10) MW.  The costs for transmission service will becharged to UWGP on a monthly basis at rates included in Schedule 1attached.  ACEC will own, operate, andmaintain

 

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a substation at a mutually agreed to location on property provided byUWGP for this purpose.  ACEC will alsoown, operate, and maintain necessary distribution facilities to provide UWGPwith the desired level of service facilities at mutually agreed tolocations.  Schedule 1 was preparedbased on preliminary indications that UWGP desired two primary voltage (4,160volt) services and five secondary (277/480 volt) services.  By mutual agreement the parties may amendthis Agreement to modify the desired number of service points and the costsassociated with those services.

 

1.2                                 Member-ownedfacilities and equipment.  UWGP willbe responsible for the secondary wire leaving each desired secondary-voltageservice point and for the transformer and secondary wire from each desiredprimary-voltage service point.  Memberwill insure that operation of its facilities will not cause harm from voltageflickering to other members of the Cooperative, or the customers of other utilities,by the installation and proper maintenance of soft-start capability for allmotors 150 horsepower and above.

 

**2.****                                      ELECTRICSERVICE GENERAL TERMS AND CONDITIONS**

 

2.1                                 UWGP,agrees prior to receiving service to become a member of the Cooperative, andshall pay the Membership fee and be bound by the Cooperative’s Bylaws,policies, rules, and regulations as they may be modified from time to time bythe Cooperative’s membership or Board of Directors.  UWGP acknowledges that it has received a copy of the currentBylaws.

 

2.2                                 Membershall provide and maintain suitable locations and electric supply for theinstallation of any Cooperative-owned electric facilities or equipment onMember’s property.  Member agrees toconvey such easements as in Cooperative’s reasonable judgment may be necessaryor convenient for the Cooperative to provide service at the location(s)described in this Agreement.

 

2.3                                 Membershall be solely responsible for the design, installation, operation,maintenance, and safety of any and all Member-supplied electric facilities orequipment.

 

2.4                                 TheCooperative shall furnish, install, operate, and maintain the Cooperative-ownedelectric equipment or facilities described in Section 1 above to deliverelectric power and energy to the Member, including the means specified to meterthat power and energy.  Meteredquantities shall include all electrical losses incurred on Site to providepower and energy to the Member.  TheCooperative does not undertake or assume any responsibility to assist or advisethe Member concerning the design, installation, operation, or maintenance ofelectric facilities or equipment supplied and owned by Member.

 

2.5                                 TheCooperative as owner and operator of the substation will retain the right toutilize the substation to meet other needs of the Cooperative’s system and theneeds of its membership.  Such usagewill not conflict with the needs of the Member herein.  If the Cooperative uses this facility insuch a manner as to conflict with the needs of the Member, the Cooperative willbe responsible for costs required to remove the conflict.

 

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If theCooperative uses the substation in such a manner as to benefit the generalmembership other than Member, then the Cooperative shall provide to the Membera construction credit for the substation based on any incremental cost theMember paid to expand the substation facilities above the capacity requested bythe Member for its own use, whether or not the Member has used the capacity itrequested for its own use.  Any incrementalcosts to be paid by the member and any construction credit eligible for refundto the Member must have been identified in writing by the Cooperative prior toconstruction of said facilities.

 

2.6                                 Electricequipment or facilities furnished and maintained by the Cooperative on theMember’s property shall remain the property of the Cooperative, and theCooperative may remove it upon reasonable notice upon termination of thisAgreement for any reason.

 

2.7                                 Authorizedrepresentatives or employees of the Cooperative may enter the Member’s premisesat all reasonable times in order to carry out the Cooperative’sresponsibilities under this Agreement, as well as to maintain or remove anyCooperative- furnished equipment or facilities.

 

2.8                                 Membershall not interfere with the operation of any Cooperative-owned electricequipment or facilities, including any metering equipment (whether owned by theCooperative or others), and Member shall advise the Cooperative as soon aspossible if Member discovers any problem with the condition or functioning ofCooperative-owned equipment or facilities. Member shall notify the Cooperative immediately if Member discovers thatthe condition or operation of any of the Member-supplied equipment orfacilities may pose a risk to any persons or property.

 

2.9                                 TheCooperative shall use reasonable diligence to provide the power and energyconsistent with the type of electric service being provided to Member.  Should the Cooperative’s supply of electricpower and energy fail or be interrupted, or become defective, through:  a) compliance with any law, ruling, order,regulation, requirement, or instruction of any federal, state, or municipalgovernment or any governmental department or agency or any court of competentjurisdiction; b) Member’s actions or omissions; c) operation of protectivedevices; or, d) acts of God, fires, strikes embargoes, wars, insurrection,riot, or other causes beyond the reasonable control of the Cooperative or theCooperative’s wholesale power supplier, neither the Cooperative nor anywholesale power supplier to the Cooperative shall be liable for any loss ordamages incurred by Member or be deemed to be in breach of this Agreement.  Member acknowledges that the delivery ofelectric power and energy may at times be subject to interruption by causesbeyond the control of the Cooperative, including weather conditions, vandalism,and other interruptions, and the Member assumes the risk of those potentialinterruptions.

 

**3.****                                      PAYMENTFOR ELECTRIC SERVICE**

 

3.1                                 Rates.

 

Member shall pay the Cooperative for all electric service providedunder this Agreement at the rates and upon the terms and conditions set forthin the rate schedule attached to and

 

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incorporated in this Agreement as Schedule 1, and any revisions orsubstitutes subsequently adopted by the Cooperative’s Board of Directors.  The rates set forth herein and attached inSchedule 1 are based on the cost of providing distribution service at thissite and for securing power supply and transmission services at the samesite.  Rates proposed in Schedule 1for distribution service are estimated. Rates for distribution service will be adjusted as necessary throughoutthe life of this agreement based on the cost to provide service.

 

Power supply rates in Schedule 1 are for the period covering fromthe signing of this Agreement until December 31, 2004, and beyond thatdate will be adjusted to reflect changes in the power supply costs to ACEC.  Transmission service costs are estimatedbased on current rates and current rate forecasts from the AmericanTransmission Company LLC (transmission system owner) and the MidwestIndependent System Operator (MISO – transmission system operator), and areincluded in the rates shown in Schedule 1.  Changes in rates charged ACEC by these or any successororganizations will cause changes in the rates to the Member, whether prior toor after December 31, 2004.

 

3.2                                 Demandand Energy Charges.

 

The demand and energy charges will be pursuant to the attached rateschedule for any demand and energy used by the Member in accordance withthat rate schedule.  The demand andenergy charges include costs for power supply, power transmission (capacity andoperation), and for the general operation of the cooperative including margins.

 

3.3                                 PowerCost Adjustment Charges.

 

The Cooperative may apply a power cost adjustment charge to energypurchases made under this Agreement. The power cost adjustment charge shall be a pass-through from theCooperative’s power and transmission suppliers, based on any changes in thecharges from the established rates for the Member.  The power cost adjustment charges will periodically be adjustedto zero as new base rates are established.

 

3.4                                 Aid-to-Construction.

 

The member will be required to make a non-refundable payment in aid ofconstruction for the facilities the Cooperative will install for the benefit ofthe member.  The amount of thisaid-to-construction shall be $253,750. This amount will remain fixed regardless of changes in scope of thefacilities to be installed so long as the total estimated or actual cost doesnot exceed $870,000 (120% of the estimate provided in the original proposal of$725,000).  Portions of this aid-to-constructionwill be invoiced to the Member as the Cooperative makes commitments on behalfof the Member for construction at the Site.

 

3.5                                 Deposit.

 

No deposit is required.

 

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3.6                                 Payments.

 

Member shall pay all bills for the Cooperative’s electric service underthis Agreement at the Cooperative’s offices at 401 East Lake Street, PO Box 70,Friendship, Wisconsin, 53934-0070.  Allpayments are overdue and in default if received by the Cooperative later thanthe 20th day of the month that the Member receives the bill for theprevious month’s service.  Member shallhave no less than 15 calendar days from postmark date of invoice prior topayment without being overdue or in default.

 

**4.****                                      AGREEMENTTERM AND TERMINATION**

 

4.1                                 Term.

 

The power supply portion of this Agreement shall be in effect as of thedate stated on page 1 and thereafter for a period of three (3) years afterelectric service is first provided.  Ateach anniversary of the commencement of service, this Agreement shallautomatically be extended so that the term again covers a period of three (3)years, unless either party gives written notice of intent not to extend.  Upon receipt of written notice, the contractshall expire on the meter reading date immediately following the then-current term;i.e., until notice of non-renewal, this Agreement will always be in force for aperiod longer than two (2) years and less than or equal to three (3) years.

 

The facility surcharge portion of this Agreement shall remain in effectindependent of rates or power supply agreements, and the Member shall beresponsible for paying this charge to cover the cost of the facilities requiredto serve the Site as provided in Section 1.1.  In the event the power supply portion of this Agreement iscancelled, the Member shall reimburse the Cooperative an amount equal to thenet book value of all Cooperative assets invested to serve the Member.  This amount shall be due on the first dayafter the power supply contract is not in effect.

 

Upon termination or expiration of this Agreement, Member shall continueto obtain electric service from the Cooperative at the applicable ratesprovided under the Cooperative’s general rate schedules.

 

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4.2                                 Defaultand Termination.

 

Member shall be in default if it fails to timely pay for service underthis Agreement, if it breaches any other of its obligations to the Cooperative,or if it becomes the subject of bankruptcy or insolvency proceedings.  If Member fails to cure that default within8 days after the Cooperative mails written notice of default to Member, andsubject to restrictions imposed by applicable law, the Cooperative may at itssole option suspend or terminate its further performance under this Agreement,disconnect electric service to Member, terminate the Agreement, or take otheraction to address the Member’s default.

 

4.3                                 Survivalof Obligations.

 

Upon termination of this Agreement, the rights and obligations of theparties under this Agreement shall cease without further liability, effectiveas of the date of termination, except that this Agreement shall still be validas to any prior obligation owed by either party including the Member’sobligation to reimburse the Cooperative for the net book value of any assetsowned by the Cooperative.

 

**5.****                                      PATRONAGECAPITAL CREDITS**

 

The Member shall accrue patronage capital credits under the terms ofthis Agreement for service at this location in accordance with the Bylaws ofthe Cooperative and subject to any applicable classification of businessformula.  The parties acknowledge thatclassification of business may result in customers of some classes of businessearning capital credits at a different rate then other classes.  Patronage capital shall be refunded to theMember in a manner consistent with other members and as determined by theCooperative’s board of directors.

 

**6.****                                      DISCLAIMEROF WARRANTY AND LIMITATION OF LIABILITY**

 

**IN PROVIDING ELECTRIC SERVICE UNDER THISAGREEMENT, THE COOPERATIVE DISCLAIMS ANY WARRANTY OF MERCHANTABILITY OR FITNESSFOR A PARTICULAR PURPOSE OF THE ELECTRIC POWER AND ENERGY SUPPLIED HEREUNDER.**  Each party shall be responsible for its ownfacilities and personnel provided or used in the performance of thisAgreement.  Neither Cooperative norMember shall be responsible to the other party for damage to or loss of anyproperty, wherever located, unless that damage or loss is caused by its ownsole negligence or intentional conduct or by the sole negligence of intentionalconduct of that party’s officers, employees, or agents, in which case thedamage or loss shall be borne by the responsible party.  The Cooperative shall not be responsible orliable to Member or to any other person for any indirect, special or consequentialdamages, or for loss of revenues from any cause.

 

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**7.****                                      ELECTRICSUPPLIER**

 

Should adispute arise between the Cooperative and some other electric power supplierover the right or the ability to service the Member’s facilities or property,the Member shall support the Cooperative’s claim for the right to serve theMember, and the Cooperative will use its reasonable best efforts to avoid anyinconvenience to the Member as a result of that dispute.

 

**8.****                                      INDEMNIFICATION**

 

Member agreesto indemnify, defend, and hold Cooperative harmless against any liability forany claims or demands arising out of property damage, bodily injury, orinterruptions to the Cooperative’s electric service caused by electricequipment or facilities owned by the Member, or the Member’s use or operationof its electric equipment or facilities.

 

**9.****                                      GENERAL**

 

9.1                                 Governing Law.  This Agreement and the rights andobligations of the parties hereunder shall be construed in accordance with andshall be governed by the laws of the State of Wisconsin.

 

9.2                                 Attorney’s Fees.  Member shall reimburse the Cooperative forall costs and all out-of-pocket expenses (including reasonable attorneys’ feesand disbursements) incurred by reason of any breach or threatened breach ofthis Agreement by the Member.

 

9.3                                 Notices.  All notices under this Agreement shall begiven in writing and shall be delivered personally or mailed by first class U.S. mail to the respective parties as follows:

 

(a)                                  ToMember:

Kevin Roche, Board President

United Wisconsin Grain Producers

P.O. Box 247

Friesland, WI  53935

 

(b)                                 ToCooperative:

Martin A. Hillert, CEO

Adams-Columbia Electric Cooperative

401 East Lake Street, P.O. Box 70

Friendship, WI  53934

 

10.4                           No Waiver.  No course of dealing nor any failure ordelay on the part of a party exercising any right, power, or privilege underthis Agreement shall operate as a waiver of any such right, power, orprivilege.  The rights and remediesherein expressly provided are cumulative and not exclusive of any rights orremedies which a party would otherwise have.

 

10.5                           EntireAgreement/Amendment.  ThisAgreement, including Schedule 1, represents the entire Agreement betweenthe parties with respect to the matters addressed in this

 

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Agreement, except as provided in the Cooperative’s Bylaws, policies,rules, and regulations, as they may be modified from time to time, which areincorporated herein.  Except asspecifically provided herein, this Agreement may be changed, waived, or terminatedonly by written Agreement signed by both parties.

 

10.6                           Assignment/Benefitof Agreement.  Any assignment ofthis Agreement, in whole, in part, or of any other interest hereunder, withoutCooperative’s written consent shall be void. Cooperative may assign this Agreement to an affiliate or affiliates ofCooperative, to a partnership or partnerships in which Cooperative or anaffiliate has an interest, or to any entity which succeeds to all orsubstantially all of Cooperative’s assets by sale, merger, or operation oflaw.  Otherwise, Cooperative may assignthis Agreement subject to Member’s written approval, which shall not beunreasonable withheld.  To the extentnot prohibited hereby, this Agreement shall be binding upon and inure to thebenefit of the parties and their successors and assigns.  The parties’ rights and obligations underthis Agreement shall run with the land, and, except as provided in thissection, shall be unaffected by any change in ownership of the Site or Sitefacilities.

 

10.7                           Severability.  If any provision of this Agreement is heldinvalid under any applicable laws, that invalidity shall not affect any otherprovision of this Agreement that can be given an effect without the invalidprovision, and, to this end, the provisions are severable.  If any term or condition of this Agreementis unenforceable under applicable law, such term or condition shallnevertheless be deemed enforceable to the fullest extent permissible and theapplicable court is requested to reform the offending term or condition.

 

10.8                           Non-disclosure.  The Member agrees not to share the terms ofthis Agreement including any information regarding charges or rates with anyother person or party, other than as is mandated by state or federal law,including but not limited to required disclosure in securities filings.  In the event of any such mandateddisclosure, Member shall give the Cooperative prior notice of the nature andcontent of the disclosure that is proposed to be made at least five (5)business days prior to the disclosure. The Cooperative may record a memorandum of this Agreement that does notdisclose the rates.

 

10.9                           Executionand Delivery.  The parties warrantand represent that the undersigned have full power and authority to execute anddeliver this Agreement on behalf of their respective companies.

 

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Executed and delivered as of the date stated on page one.

 

 
|   | **ADAMS-COLUMBIA ELECTRIC COOPERATIVE** |
|--------|-----------------------------------------|
|   |                                    |
|   |                                    |
|   | **By: **                           | /s/ Martin A. Hillert, CEO |   |
|   |                                    |   |
|   |                                    |   |
|   | **UNITED WISCONSIN GRAIN PRODUCERS**    |
|   |                                    |   |
|   | **By: **                           | /s/ Kevin Roche, Board President |   |
|        |                                         |  |  |  |

 

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Schedule 1

 

**UWGP Friesland Ethanol Plant**

**Rate Proposal from Adams-Columbia ElectricCooperative**

**Estimated Rates for 2004 (1)**

 
| Customer (facility) charge                            |   | $      | 700.00     |                                    | per month                                 |
|-------------------------------------------------------|--------|--------|------------|-----------------------------------------|-------------------------------------------|
|                                                  |   |   |       |                                    |
| Demand (2)                                            |   | $      | 9.90       |                                    | per kW based on 15 min. readings          |
| on peak [8am to 8pm] (3)                              |   |   |       |                                    |
|                                                  |   |   |       |                                    |
| Energy                                                |   | $      | 0.0237     |                                    | per kWhr,                                 |
| Regardless of time of day                             |   |   |       | before any power cost adjustment  (PCA) |
|                                                  |   |   |       |                                    |
| Reactive energy charge (4)                            |   | $      | —     |                                    | per rkVAh of billed reactive energy       |
|                                                  |   |   |       |                                    |
| Estimated cost of sub and distribution facilities (5) |   | $      | 725,000.00 |                                    |                                      |
|                                                  |   |   |       |                                    |
| Required contribution in aid of construction (6)      |   | $      | 253,750.00 |                                    | one time non-refundable payment           |
|                                                  |   |   |       |                                    |
| Balance of substation & distribution costs        |   | $      | 471,250.00 |                                    | payable by facility surcharge             |
|                                                  |   |   |       |                                    |
| Facility surcharge for substation & dist. costs   |   | $      | 3,358.00   |                                    | per month in addition to facility  charge |

 

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| (1)                                                                                                                                                                     | ACEC’s power supply rates shown here are valid from July 7, 2003  until December 31, 2004.                                                      |
|-------------------------------------------------------------------------------------------------------------------------------------------------------------------------|----------------------------------------------------------------------------------------------------------------------------------------------------------------|
| Rates beyond this time will be based on any changes from Alliant,  ATCLLC, and MISO for power supply, transmission capacity, and transmission  operations respectively. |
|                                                                                                                                                                    |                                                                                                                                                           |
| (2)                                                                                                                                                                     | This demand rate includes estimates of power supply and transmission  supply charges.  Rates will be  adjusted to reflect any changes from this estimate. |
|                                                                                                                                                                    |                                                                                                                                                           |
| (3)                                                                                                                                                                     | This peak period would correlate to the peak period that ACEC has  with its power supplier.  We have no  plans to change the peak period at this time.    |
|                                                                                                                                                                    |                                                                                                                                                           |
| (4)                                                                                                                                                                     | This will be a pass-through from ACEC transmission supplier.  There is no change or credit with the rate  proposal at this time.                          |

 
| (5)    | Cost estimate for substation and  distribution facilities:    |   |   |    |
|--------|---------------------------------------------------------------|--------|--------|---------|
|   | Substation cost estimate                                      |   | $      | 624,000 |   |
|   | Distribution cost estimate (includes 5  service transformers) |   | $      | 101,000 |   |
|   | Total substation & distribution cost  estimate            |   | $      | 725,000 |   |

 
| (6) | Contribution required in aid of construction of 35% of the total  construction costs = $253,750 |
|-----|-------------------------------------------------------------------------------------------------|

 

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