Document:

Exhibit 10.7

	
  

  	
  NorthWestern Energy Company

  
	
  125 S. Dakota Ave

  
	
  Sioux Falls, SD 57104

  
	
  Telephone: (605) 978-2908

  
	
  Facsimile: (605) 978-2817

  www.northwesternenergy.com

  

 

Natural Gas Distribution Delivery Agreement

1.                                       This Natural Gas Distribution Delivery
Agreement (“Agreement”), for the distribution of natural gas, is made and
entered into by and between NorthWestern Corporation, a Delaware Corporation,
dba NorthWestern Energy, and Millennium Ethanol, LLC (“Customer”), a South Dakota
limited liability company, this 16th day of February 2007. This Agreement shall
become effective on the date Customer begins commercial operations (“Plant
Start-Up Date”), which is assumed to be December 2007. This Agreement
represents the entire agreement of the parties. This Agreement supercedes and
fully replaces all previous agreements, including but not limited to, the
Natural Gas Distribution Delivery Agreement between the Parties executed on the
30th day of
May 2006.

2.                                       NWE agrees to arrange for the construction of
pipeline facilities (the “Pipeline Extension”), with a distribution delivery
pipeline of approximately 32 miles in length from an interconnection between
Northern Natural Gas (“NNG”) and the Customer’s plant. All of such facilities
to be constructed will remain the property of NWE and its affiliates, and,
subject to the terms set forth herein, NWE and its affiliates shall have the
right to serve other customers from said pipeline facilities constructed.

3.                                       Delivery Quantities: NWE shall make available
the following capacity on the constructed pipeline for the benefit of Customer:

	
  Maximum Daily Quantity*

  	
   

  	
  13,200 MMBtu per day

  
	
   

  	
   

  	
   

  
	
  Average Minimum
  Daily Quantity*

  	
   

  	
  10,800 MMBtu per day

  

 

*
NWE and Customer agree that the above stated volumes are estimates. Plant
volumes may change from time to time and future expansion may occur prior to
the end of this Agreement. NWE will maintain a maximum capacity of 13,200 MMBtu
per day available at the Millennium Ethanol site for Customer’s use throughout
the Term (as defined below) of this Agreement. NWE agrees to offer the same
prices as stated in Section 4 below, so long as additional improvements to NWE
facilities are not required to enable service or increase capacity under this
Agreement. At the end of the Term, Customer shall have the
Right-of-First-Refusal (ROFR) for the Maximum Daily Quantity of 13,200 MMBtu as
defined above, at tariff rates or a negotiated rate. If a negotiated rate were
agreed to the rate would need to be approved by the South Dakota PUC. NWE
agrees to notify Customer of this ROFR provision not less than 12 months prior
to the expiration of this Agreement. Customer shall have not less than 6-months
to exercise this ROFR.

4.             Service: Firm Transportation Service on the
Pipeline Extension up to the maximum daily quantity in Section 3.

a)              Distribution Delivery Service: NWE shall
provide natural gas distribution service to Customer as follows:

 

	
  Annual Volume

  	
   

  	
  Rate

  	
   

  	
  Service

  
	
  First 3,900,000
  MMBtu

  	
   

  	
  $0.345 Per MMBtu

  	
   

  	
  Firm

  
	
  3,900,001 –
  5,250,000 MMBtu

  	
   

  	
  $0.20 Per MMBtu

  	
   

  	
  Firm

  
	
  Over 5,250,001
  MMBtu

  	
   

  	
  $0.11 Per MMBtu

  	
   

  	
  Interruptible

  

 

b)             Balancing Service:    Customer will provide their own balancing
service on both the Pipeline Extension and on NNG’s interstate pipeline
transportation system. NWE agrees to enter into an end user allocation
agreement between Customer, NWE and NNG for the purposes of accessing NNG’s
balancing services.

5.                                       Customer agrees to transport a minimum of
39,000,000 MMBtu of natural gas under this Agreement (the “Minimum Total
Obligation”) during the Term (as defined below), and to transport a minimum
annual volume of 3,900,000 MMBtu of natural gas under this Agreement,
calculated for each twelve-month period following the Plant Start-Up Date (the “Minimum
Annual Obligation”). Once the Minimum Total Obligation is met, the Minimum
Annual Obligation shall no longer exist under the Agreement.

a)              In the event that Customer fails to use such
Minimum Total Obligation or Minimum Annual Obligation, or should this Agreement
be terminated for any reason by Customer, other than for NWE’s refusal to
perform its obligations, Customer shall not be relieved of its obligation to
remit funds to cover its Minimum Total Obligation or its Minimum Annual
Obligation during any year during the Term of this Agreement. In the event of
Agreement termination by Customer NWE shall bill Customer, within 45 days after
the effective date of such termination, a one-time charge for the entire
outstanding balance of Customer’s Minimum Total Obligation, or

b)             In the event Customer fails to meet its
Minimum Annual Obligation in any usage year during the Term of this Agreement,
NWE shall bill Customer, within 45 days after the end of that usage year, a
one-time charge for the remaining balance of the Minimum Annual Obligation at
the rate provided per MMBtu in Section 4, in the event the Customer fails to
pay the outstanding Minimum Annual Obligation by the terms in Section 8, NWE
may draw any outstanding, due and payable portion of the Minimum Annual
Obligation from the standby letter of credit, assurance bond, or credit
insurance policy.

c)              At no time shall the total of all funds
collected by NWE under this Section 5 exceed the then current outstanding
balance due under the Minimum Total Obligation. In addition, any Minimum Annual
Obligation deficiency which is charged and paid, shall be counted toward the
Minimum Total Obligation Additional gas usage by the utility for other
connected customers through the Marion interconnect not resulting from
additional utility capital improvements that provide additional capacity on to
the original pipeline, will be credited as volume transported under this
contract towards the Minimum Total Obligation and Minimum Annual Obligation.

d)             In the event the Minimum Annual Obligation is
exceeded in any year, Customer shall have the option to bank that portion of
actual volume in excess of the Minimum Annual Obligation and apply such banked
amount to future years when and if the Minimum Annual Obligation volumes are
not met. Similarly, actual volumes taken in excess of the Minimum Annual Obligation
in a given year can be applied to past years when the Minimum Annual Obligation

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volume was not met. When
excess volumes are applied to past years, NWE will provide a credit equal to
the excess volume times the deficiency rate.

6.                                       Customer will obtain an irrevocable standby
letter of credit, assurance bond, or credit insurance policy, satisfactory to
NWE each year for a period of up to 10 years. Customer shall obtain a letter of
Credit that expressly provides NWE the ability to draw upon it as described in
Sections 5 and 6. The irrevocable standby letter of credit, assurance bond, or
credit insurance policy must be in an amount that is sufficient to cover the
initial estimated $ 5,500,000 construction of the pipeline declining each year
as follows.

a)              It
is the intent that the need for a letter of credit, assurance bond or credit
insurance policy will be reviewed annually.

b)             Each year the minimum usage requirements of
this contract are met the amount required for a letter of credit, assurance
bond or credit insurance will decline as if the initial estimated construction
costs ($ 5,500,000) was amortized straight-line over a 10-year period.  If the minimum requirements of this contract
are exceeded the amount in excess will be credited to the principal balance for
the purposes of calculating the amount of the required letter of credit,
assurance bond or credit insurance.

c)              In the event NWE does not receive written
confirmation of the annual renewal of the required standby letter of credit,
assurance bond, or credit insurance in an amount and form consistent with the
initial credit support document issued pursuant to this section of the
agreement 45 (forty-five) days prior to the expiration of said standby letter
of credit, assurance bond, or credit insurance, NWE may draw the entire Minimum
Total Obligation outstanding against the standby letter of credit, assurance
bond, or credit insurance. For further clarification, it is the Customer’s
obligation to have issued each year a standby letter of credit, assurance bond,
or credit insurance policy in an amount sufficient to cover the remaining
Minimum Total Obligation as defined in this section, and to deliver a new
standby letter of credit, assurance bond, or credit insurance policy to NWE 45
(forty-five) days prior to expiration. In the event Customer fails to make such
delivery to NWE, NWE may draw the entire remaining Minimum Total Obligation
from the standby letter of credit, assurance bond, or credit insurance policy.

7.                                       Term: 10 years, commencing with the Plant
Start-Up Date.

8.                                       Billing and Payment: NWE shall use reasonable
efforts to render invoices on or before the 10th day of each month for all gas
delivery commodity and monthly customer charges applicable to gas deliveries to
the Customer in the preceding month. Customer shall pay NWE on or before the
25th day of each month for all charges reflected on the invoice rendered by NWE
in the current month, and for any Minimum Obligation or Minimum Annual
Obligation due under Section 6. Payments received after the 25th will be
assessed a 1% carrying charge.

9.                                       Condition Precedent: The Parties expressly
agree and acknowledge that rates, whether provided for by tariff or negotiated
contract, under this Agreement are subject to the approval of the South Dakota
PUC. The Parties shall work in good faith and undertake all necessary action to
obtain any necessary regulatory approval of the rates set forth herein, whether
provided for by tariff or negotiated contract. In the event approval of the
rates is not granted by the South Dakota PUC, the parties shall re-negotiate in
good faith to come to an agreement that can obtain regulatory approval.

 3
 

10.                                 Governing Law: This Agreement shall be
governed by and interpreted under the laws of the State of South Dakota.

	
  Millennium Ethanol, LLC

  	
   

  	
  NorthWestern Corporation,

  
	
   

  	
   

  	
  dba NorthWestern Energy

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By

  	
  /s/ Steve Domm

  	
   

  	
  By

  	
  /s/ Michael J. Hanson

  
	
   

  	
   

  	
   

  
	
  Title

  	
  CEO

  	
   

  	
  Title

  	
  CEO

  
							

 

 4

ASSIGNMENT
AND ASSUMPTION AGREEMENT

This
Agreement is made as of March 6, 2007 by NorthWestern Services Corporation, a
South Dakota Corporation (“NSC”) and North Western Corporation, dba
Northwestern Energy, a Delaware corporation (“Assignee”).

Whereas, NSC and Millennium Ethanol, LLC, a South Dakota Limited Liability
Company (“Millennium”), are parties to a Natural Gas Delivery Distribution
Agreement (“Agreement”) dated May 30, 2006;

Whereas, NSC desires to assign all of its interest, obligations, and all other
rights and privileges under the Agreement to Assignee;

Whereas,
Assignee is willing to accept the assignment and assume all of the obligations
of NSC under the Agreement;

Now,
therefore, in consideration of the foregoing and the mutual covenants set forth
herein, NSC hereby assigns to Assignee, and Assignee hereby assumes, all of the
right, title, interest, privileges and obligations of NSC in and under the
Agreement, and Assignee agrees to perform all of said obligations under the
Agreement as and when required thereunder.

	
  Signed this 6th day of March, 2007.

  	
   

  	
   

  
	
  NorthWestern Corporation,

  	
   

  	
   

  
	
  dba NorthWestern Energy

  	
   

  	
  NorthWestern Services Corporation

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Michael J. Hanson

  	
   

  	
   

  	
  By:

  	
  /s/ [ILLEGIBLE] 

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Its:

  	
  CEO

  	
   

  	
   

  	
  Its:

  	
  VP Operations

  	
   

  

 

Millennium
hereby consents to the foregoing assignment of the Agreement from NSC to
Assignee.

	
  Millennium Ethanol, LLC

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  By:

  	
  /s/ Steve Domm

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
  Its:

  	
  CEOExhibit 10.8

ELECTRIC SERVICE AGREEMENT

This Agreement made and
entered into this 14th day of
July 2006, by and between Southeastern Electric Cooperative, Inc., Marion,
South Dakota (hereinafter called the Cooperative) and Millennium Ethanol, LLC.
Marion, South Dakota (hereinafter called the Customer).

WITNESSETH:

WHEREAS, the Customer is constructing an ethanol plant located in Turner County,
South Dakota (hereinafter called the Facility): and

WHEREAS, the Customer desires to have the Cooperative provide all of the
electric power and energy requirements of the Facility and the Cooperative is
willing and able to provide these requirements.

NOW, THEREFORE, in consideration of the mutual promises, covenants and conditions
contained herein, the Cooperative and the Customer agree as follows:

1.             Description of Facility.

The Facility shall include
the Customer owned ethanol plant and related facilities located in Section
Thirty-one (31), Township One Hundred (100) North, Range Fifty-four (54) West,
Turner County, South Dakota.

2.             Agreement to Sell and
Purchase.

The Cooperative hereby
agrees to sell and deliver to the Customer and the Customer agrees to purchase
and receive from the Cooperative all of the electric power and energy
requirements of the Customer upon the terms and conditions hereinafter
provided.

3.             Service Characteristics.

a.             Service Delivery. 
Service hereunder shall be provided at multiple service locations at the
Facility, consisting of approximately 3 miles of 3 phase 12.47 kV (1.0, 4/0 and
500 MCM) underground distribution line, 13 padmount transformers, (7-1500 kVA
277/480 volt 3 phase transformers, 1-1500 kVA 4,160 volt 3 phase transformer.
4-1000 kVA 227/480 volt 3 phase transformers and 1-150 kVA 120 208 volt 3 phase
transformer) along with associated switch gear, underground conduit and
metering. The Cooperative shall install or cause to be installed, operated and
maintained approximately 2 miles of 69 kV transmission line and a 69/12.47 kVA
substation located at the plant site.

b.             Capacity.  Electrical service to the
Facility under this Agreement shall be limited to 12,500 kVA. Service to
additional load above 12,500 kVA shall require an amendment to this Agreement.

c.             Firm Service.  Service hereunder shall be firm and therefore
not subject to load curtailment. Power interruptions may occur as the result of
planned and

Millennium
Ethanol, LLC Electric Service Agreement

coordinated maintenance and
circumstances beyond the control of the Cooperative as provided for in Section
4,i. of this Agreement.

4.             Service Conditions and
Requirements.

a.             Cooperative-Owned Facilities.  The
Cooperative will furnish or cause to be furnished, installed and maintained,
according to prudent utility practices, all electric equipment and facilities
required to deliver electric power and energy to the Customer for the Facility
to the point of interconnection. The Cooperative shall install or cause to be
installed approximately 2 miles of 69 kV transmission line and a 69 to 12.47 kV
substation located at the Facility. The point of interconnection shall be
located at the low voltage terminals of the distribution transformers detailed
in 3.a. above. Electric service equipment furnished, installed, operated and
maintained by the Cooperative on the property of the Customer shall remain the
property of the Cooperative and may be removed upon termination of this
Agreement.

b.             Customer-Owned Facilities.  The
Customer shall be solely responsible for the design, installation, maintenance
and safety of any and all Customer supplied electric facilities or equipment.
The Customer shall provide and maintain the necessary protection equipment to
protect its own facilities from harm from any electrical cause as well as to
protect the Cooperative’s equipment and members from any damages, interruption
of service, or faulty service due to faults or operations of the Customer’s
equipment.

c.             Location of Cooperative Facilities. The Customer shall provide to the
Cooperative suitable locations for the installation of electric facilities on
the property of the Customer. The Customer shall provide the Cooperative or its
power supplier, at no cost, an appropriate instrument of conveyance (acceptable
to Customer’s secured lenders and the Cooperatives) for the substation property
and permanent easements (acceptable to Customer’s secured lenders and the
Cooperatives) for all other electric power supply facilities of the Cooperative or its power
supplier located on site. The Customer shall provide site grading for the
substation at no cost to the Cooperative and shall provide concrete pads for
all distribution transformers and switchgear in accordance with specifications
provided by the Cooperative.

d.             Accessibility to Cooperative Facilities. Duly authorized representatives of the Cooperative
shall be permitted to enter on the property of the Customer to the extent
necessary to maintain and service electric facilities at all reasonable times
in order to carry out the provisions of this Agreement.

e.             Operation of Cooperative Equipment. The Customer shall do nothing to interfere with
the operation of any Cooperative-owned electric equipment or facilities,
including any metering, telecommunications, or control equipment. The Customer
shall advise the Cooperative as soon as possible if the Customer discovers any

 2
 

apparent problem with the
condition or functioning of the Cooperative’s equipment or facilities.

f.              Operation of Customer Equipment.  The
Customer’s electric service, electric facilities, and load characteristics will
conform to the National Electric Code and National Electric Safety Code,
IEEE/ANSI standards, and prudent utility practices. If the operation of any of
the Customer’s equipment causes power quality or operational problems to the
Cooperative’s electric system, the Customer shall promptly correct or remove
the cause of the problem. If the Customer does not eliminate the problem, the
Cooperative can correct or remove the problem from the electric system and the
Customer will be responsible for the costs. The Customer shall notify the
Cooperative immediately if the Customer discovers that the condition or
operation of any of the Customer-supplied electric equipment or facilities may
pose a risk to any persons or property.

g.             Power Factor.  The
Customer agrees to maintain unity (100%) power factor as nearly as practical.
The demand charges may be adjusted to correct for average power factors less
than five percent (5%) unity (lagging) or greater than five percent (5%) unity
(leading) by increasing the measured demand one percent (1%) for each one percent
(1%) by which the average power factor is less than five  percent (5%) unity (lagging) or more than
five percent (5%) unity (leading).

h.             Cooperative Membership.  The
Customer shall be a member of the Cooperative.

i.              Hold Harmless.  If
the supply of electric power and energy provided by the Cooperative should fail
or be interrupted, or become defective, through (a) compliance with any law,
ruling, order, regulation, requirement or instruction of any federal, state or
municipal governmental department or agency or any court of competent
jurisdiction; (b) Customer action or omissions: or (c) acts of God, fires,
strikes, embargoes, wars, insurrection, riot, equipment failures, operation of
protective devices, or other causes beyond the reasonable control of the
Cooperative, the Cooperative shall not be liable for any loss or damages
incurred by the Customer or be deemed to be in breach of this Agreement. The
Customer acknowledges that the delivery of electric power and energy may at
times be subject to interruption by causes beyond the control of the
Cooperative, including weather conditions, vandalism, accidents, and other
interruptions, and that the Customer assumes the risk of those potential
interruptions. The Cooperative will use its best efforts to restore electric
service in the shortest reasonable time under the circumstances.

5.             Revenue
Metering.

a.             Point of Metering.  Metering
will measure the demand and energy of the total Facility, and will be located
at the on-site 69/12.47 kV substation on the 7.2/12.47 kV secondary
bus of the substation.

 3
 

b.             Metering Responsibility.  All
revenue metering shall be furnished, installed, maintained and read by the
Cooperative.

c.             Meter Testing Procedure.  The
metering shall be tested once every two years for accuracy by the Cooperative or its designee. In addition, at any
time either party may request that the metering be tested. The requesting party
will be responsible for the cost of the test. If any test discloses the
inaccuracy of said meters to the extent of more than two percent (2%) fast or
slow, an adjustment in billing shall be determined by the Cooperative from the
best information available.

d.             Meter Failure.  Should the metering equipment at any time fail
to register proper amounts or should the registration thereof be so erratic as
to be meaningless, the capacity and energy delivered shall be determined by the
Cooperative from the best information available.

6.             Rates and Payment.

a.             Rate Schedule Application.  The
Customer shall pay the Cooperative for service rendered hereunder at the rates
and upon the terms and conditions set forth in Rate Schedule Large Power
Service - Millennium Ethanol, LLC attached to and made a part of this Agreement
and any revisions thereto or substitutions thereof adopted by the Cooperative’s
Board of Directors.

b.             Rate Guarantee.  The
demand and energy components of the attached rate schedule are guaranteed to
remain unchanged for the years 2007 and 2008, except as provided herein. The
parties agree that the rates specified may be adjusted by the amount of any new
or increased level in current local, state or federal taxes or fees.

c.             Rate Changes Beyond the Guarantee Period. Through this agreement, the parties understand
that rate changes beyond 2008 will be principally driven by changes in wholesale
rates charged by the Cooperative’s power supplier. The parties further agree
that it is appropriate for future increases in the Cooperative’s cost of operations
to be reflected in rates charged to the Customer. As a Cooperative member, the
Customer is entitled to fair and equitable treatment relative to the market-based
rates and other service conditions as contained within this agreement. The
Cooperative will provide reasonable notification of any rate changes.

d.             Facilities Charge.  The
Customer shall pay a monthly facilities charge in accordance with the attached
rate schedule. The facilities charge will be adjusted if the Cooperative
installs additional facilities not part of this agreement.

e.             Payment Arrangements. All charges for service shall be paid to
the Cooperative by electronic funds transfer, which will be initiated by the
Cooperative. The monthly billing periods shall be from the first day of the
month through the last

 4
 

day of the month. Such
charges shall be due and payable on the date of billing (on or about the tenth
of the month). If payment is not received by the Cooperative within ten days of
the due date, the Customer agrees that the Cooperative may disconnect service
to the facility until the payment is made. To secure the payment of said
electric service charges, the Customer shall pay to the Cooperative the sum of
$200,000 no later then 15 days prior to the startup of commercial operation of
the Facility or by February 1, 2008.

f.              Late Payment Charges.  If
payment is not received by the date indicated on the bill, the customer shall
be considered delinquent. The Cooperative will apply and the Customer shall pay
a late payment charge based on the Cooperative’s policy of general application
in effect at the time.

g.             Disputed Bills.  The
Customer shall pay all bills for services and/or energy on a timely and in
accordance with billing procedures herein contained even though said charges
may be disputed. If it is determined that the Customer is entitled to a refund
or credit for a disputed bill, the Cooperative shall, in addition to the
principal amount refunded or credited, pay interest on said amount at the rate
authorized for interest on judgments in the State of South Dakota, Neither
party shall be obligated to settle disputes by arbitration or mediation without
the mutual consent of the parties.

7.             Commencement and Termination.

a.             Commencement Date. This Agreement shall be in effect as of the
date executed and the Customer’s obligation to purchase electricity and to commence
payments under this agreement shall begin upon the startup of the commercial
operation of the Facility but no later than February 1, 2008, whichever occurs
first. Electric power requirements for plant construction prior to commercial
operation shall be subject to the Cooperative’s standard tariffs.

b.             Minimum Facilities Charge Obligation.  In
the event that this Agreement is terminated less then 10 years after start up,
except for default of the Cooperative, and the Customer ceases to use the
facilities described in Section 3a, the Customer agrees to pay to the
Cooperative the equivalent of 10 years (120 months) of Facility Charges that
the Customer would have paid if the agreement would have remained in effect for
10 years, less Facility Charge payments already made by the Customer prior to
termination.

c.             Default and Termination.  The
Customer shall be in default if it fails to timely pay for service under this
Agreement, if it breaches any other of its obligations to the Cooperative, or
if it becomes the subject of  bankruptcy or insolvency
proceedings. If the Customer fails to cure that default within ten (10) days
the Cooperative may, after notice from the Cooperative, suspend or terminate
its further performance under this Agreement, disconnect electric service to
the Customer, terminate this Agreement, or take other action to address the

 5
 

Customer’s default. This provision shall not limit
the Cooperative’s right to take immediate action to suspend services if the
Customer’s act or omission interferes with the safe and efficient operation of
the Cooperative’s electric system, nor shall it limit the Cooperative’s right
to pursue any other or further remedy available to it by law.

d.             Regulatory Termination. 
Should the South Dakota Public Utilities Commission or any court of
competent jurisdiction fail to assign the customer to the Cooperative, this
contract shall be null and void.

8.             Patronage Capital Credits.

Service under the rates
provided for in this Agreement is subject to a special allocation of capital
credits to the Customer by the Cooperative. This allocation will take into
account the unique cost assignment associated with the market-based rates that
are included in this Agreement. For the purpose of this Agreement, the Customer
acknowledges that it is not a natural person under South Dakota law.

9.             Disclaimer of Warranty and
Limitation of Liability.

Each party shall be responsible for its own
facilities and personnel provided or used in the performance of this Agreement.
Neither the Cooperative nor the Customer shall be responsible to the other
party for damage to or loss of any property, wherever located, unless the
damage or loss is caused by its own negligence or intentional conduct or by the
negligence or intentional conduct of that party’s officers, employees, or
agents, in which case the damage or loss shall be borne by the responsible
party. Neither party shall be responsible or liable to the other or to any
other party for any indirect, special or consequential damages, or for loss of revenues
from any cause.

10.          Indemnification.

a.             The Customer shall assume all liability for
and shall indemnify the Cooperative and its members, trustees, directors,
officers, managers, employees, agents, representatives, affiliates,
transmission provider, successors and assigns and shall hold them harmless from
and against any claims, losses, costs, and expenses of any kind or character
that result from Customer’s negligence or wrongful conduct in connection with
the design, construction, installation, operation or maintenance of the
Facility. Such indemnity shall include, but is not limited to, financial responsibility
for (a) monetary losses; (b) reasonable cost and expenses of defending an
action or claim: (c) damages related to death or injury: and (d) damages to property; provided
that Customer shall not be liable for special, indirect, incidental, punitive
or consequential damages.

b.             The Cooperative shall assume all liability
for and shall indemnify the Customer and its directors, officers, managers, employees,
agents, representatives, affiliates, successors and assigns and shall hold them
harmless from and against any claims,

 6
 

losses, costs, and expenses
of any kind or character that result from Cooperative’s negligence or other
wrongful conduct in connection with the design, construction, installation,
operation or maintenance of its facilities. Such indemnity shall include, but
is not limited to, financial responsibility for (a) monetary losses; (b)
reasonable cost and expenses of defending an action or claim; (c) damages
related to death or injury; and (d) damages to property; provided that
Cooperative shall not be liable for special, indirect, incidental, punitive or
consequential damages.

11.          General.

a.             Governing Law.  This
Agreement and the rights and obligations of the parties hereunder shall be
construed in accordance with and shall be governed by the laws of the State of
South Dakota.

b.             Notices.  All notices under this
Agreement shall be given in writing and shall be delivered electronically and
mailed by first class mail to the respective parties as follows:

To Customer:

Millennium Ethanol, LLC

300 North Broadway

Marion, SD 57043

To Cooperative:

Brad Schardin, Manager 

Southeastern Electric Cooperative, Inc, 

PO Box 388

Marion, SD 57043

c.             No Waiver.  No course of dealing nor any
failure or delay on the part of a party in exercising any right, power or
privilege under this Agreement shall operate as a waiver of any such right,
power or privilege. The rights and remedies herein expressly provided are
cumulative and not exclusive of any rights or remedies, which a party would
otherwise have.

d.             Entire Agreement/Amendment.  This
Agreement represents the entire Agreement between the parties and may be
changed, waived, or terminated only by written agreement signed by both parties
as set forth herein.

e.             Assignment.  The Cooperative may not assign
this Agreement without written consent of Customer, which consent shall not be
unreasonably withheld. The Customer may not assign this Agreement without the written
consent of the Cooperative, which consent shall not be unreasonably withheld.

f.              Severability.  Should
any part, term or provision of this Agreement be by a court of competent
jurisdiction, decided to be illegal or in conflict with any applicable law, the
validity of the remaining portions or provisions shall not be affected thereby.

 7
 

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

	
  Attest:

  	
   

  	
  Southeastern Electric Cooperative, Inc.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Steve
  Holmberg

  	
   

  	
  By:

  	
  /s/ Harley Bruns

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  Secretary

  	
   

  	
  Title:

  	
  President

  	
   

  
							

 

Corporate Seal

	
  Attest:

  	
   

  	
  Millennium Ethanol, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
  /s/ Brent
  Edwards

  	
   

  	
  By:

  	
  /s/ Steve Domm

  	
   

  
	
   

  	
   

  	
   

  
	
  Title:

  	
  CFO

  	
   

  	
  Title:

  	
  CEO

  	
   

  
							

 

Corporate Seal

	
  STATE OF SOUTH DAKOTA)

  
	
                                                      SS

  
	
  COUNTY OF Turner)

  

 

On
this 18 day of July, 2006, before me John B. McDonald, the undersigned office,
personally appeared Harley Bruns, who acknowledged him/herself to be the
President  of Southeastern
Electric Cooperative, Inc., a South Dakota Corporation, and that (s)he as such
President being authorized so to do. executed the foregoing instrument for the
purposes therein contained, by signing the name of the Corporation by
(him)herself as President.

IN WITNESS WHEREOF I hereunto set my hand and official seal.

	
  

  	
   

  	
   

  	
   

  	
  /s/ John B. McDonald

  	
   

  
	
   

  	
  JOHN B. McDONALD

  	
   

  	
   

  	
  Notary Public - State of South Dakota

  
	
  (SEAL)

  	
  NOTARY PUBLIC

  	
  (SEAL)

  	
   

  	
  My Commission expires 10/24/2011

  
	
   

  	
  SOUTH DAKOTA

  	
   

  	
   

  	
   

  

 

 8
 

 

	
  STATE OF SOUTH DAKOTA)

  
	
                                                       SS

  
	
  COUNTY OF
  Turner)

  

 

On
this 14th day of
July, 2006, before me Robin R. Smith, the undersigned office, personally
appeared Steve Domm, who acknowledged (him) herself to be the CEO of
Millennium Ethanol, LLC. a South Dakota Limited Liability Company, and that (s)
he as such CEO, authorized so to do, executed the foregoing instrument for the purposes
therein contained, by signing the name of the Limited Liability Company by (him)herself
as CEO.

IN WITNESS WHEREOF] hereunto set my hand and official seal.

	
  

  	
   

  
	
   

  	
  /s/ Robin R. Smith

  
	
   

  	
   

  
	
  

  	
  Notary Public -
  State of South Dakota

  
	
   

  	
  My commission
  expires 4/10/11

  
	
   

  	
   

  
	
  (SEAL)

  	
   

  

 

 9
 

SOUTHEASTERN ELECTRIC COOPERATIVE, INC. 

MARION, SOUTH DAKOTA

LARGE POWER SERVICE - MILLENNIUM ETHANOL, LLC

AVAILABILITY

Available to Millennium
Ethanol, LLC ethanol facility located in Section Thirty-one (31), Township One
Hundred (100) North, Range Fifty-four (54) West, Turner County, South Dakota, for
commercial operation of the facility. This schedule is not available for
start-up or construction power and is subject to the established rules and
regulations of the Cooperative.

TYPE OF SERVICE

Multiple deliveries of
alternating current, three-phase and single-phase at voltages of 277/480.
120/208 volts and 4,160 volts.

MONTHLY PAYMENT

The Customer shall pay the
Cooperative for services hereunder at the following rates and conditions:

	
  Facilities Charge

  	
   

  	
  $

  	
  47,150.00

  	
   

  	
  per
  month, plus

  	
   

  
	
  Demand Charge

  	
   

  	
  $

  	
  8.85

  	
   

  	
  per
  kW, plus

  	
   

  
	
  Energy Charge

  	
   

  	
  $

  	
  .0217

  	
   

  	
  per kWh

  	
   

  

 

FACILITIES CHARGE

The Customer will pay a
monthly Facilities Charge in the amount of $47,150.00.  The Facilities Charge will be adjusted if the
Cooperative installs additional facilities.

BILLING DEMAND

The billing demand shall be
equal to the Customer’s contribution to the monthly billing demand from the
Cooperative’s, power supplier, as determined by a demand meter or otherwise,
and may be adjusted for power factor.

MINIMUM BILLING DEMAND

The demand for billing
purposes shall not be less than 2,000 kW for any billing period.

MINIMUM CHARGES

The minimum monthly charge
shall be the Facilities Charge plus the Minimum Billing Demand Charge provision
of this rate.

 10
 

POWER FACTOR ADJUSTMENT

The Customer agrees to
maintain unity (100%) power factor as nearly as possible. The demand charges
may be adjusted to correct for average power factors less than five percent
(5%) unity (lagging) or greater than five percent (5%) unity (leading) by
increasing the measured demand one percent (1%) for each one percent (1%) by
which the average power factor is less than five percent (5%) unity (lagging)
or more than five percent (5%) unity (leading).

STATE AND MUNICIPAL TAXES

All applicable state and
municipal sales tax and any other non-ad valorem taxes imposed on electric
sales shall be applied to monthly bills rendered under this rate  schedule
unless the consumer is exempt from said tax or taxes.

TERMS OF PAYMENT

All
charges for service shall be paid to the Cooperative by electronic funds
transfer, which will be initiated by the Cooperative. The monthly billing
periods shall be from the first day of the month through the last day of the
month. Such charges shall be due and payable on the date of billing (on or
about the tenth of the month). If payment is not received by the Cooperative
within ten  days of the due date,
the Customer agrees that the Cooperative may disconnect service to the facility
until the payment is made. To secure the payment of said electric service charges,
the Customer shall pay to the Cooperative the sum of $200,000 no later then 15
days prior to the startup of commercial operation of the Facility or by
February 1, 2008.

In
the event the current monthly bill is not paid in accordance with the payment dates
indicated on the bill, a late payment penalty in effect at the time shall
apply.

EFFECTIVE

This
rate tariff shall be in effect upon the startup of the commercial operation of
the Facility, but no later than February 1, 2008, whichever occurs first.

 11

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