Document:

Exhibit
10.9

MANAGEMENT
AGREEMENT

BETWEEN

MILLENNIUM ETHANOL, LLC

AND

FREMAR FARMERS COOPERATIVE, INC.

This Management Agreement is
dated effective as of September 6, 2005 (this “Agreement”) and is between
FREMAR FARMERS COOPERATIVE, INC. (“FREMAR”)  and Millennium Ethanol, LLC  (the “Company”).

WHEREAS, FREMAR has a long
experience of purchasing, handling and marketing grain and has assisted in the
development of the Company;

WHEREAS, the Company is a newly organized
development stage company that intends to build and operate an ethanol
production facility; and

WHEREAS, the Company desires to
engage FREMAR to provide construction, consulting, and management services to
the Company under the terms of this Agreement.

NOW, THEREFORE, in consideration
of the foregoing, and the respective covenants and agreement of the parties
contained herein, and for other good and valuable consideration, the receipt
and sufficiency of which are hereby acknowledged, the parties hereto hereby
agree as follows:

1.0          Services
to be Provided.

(a)           Construction, Consulting,
and Management Services to the Company.  During the term of this Agreement and except
as otherwise from time to time requested by the Company, FREMAR shall provide
to the Company:

(1)           Management and development services and
the services of Company Manager as provided in the Operating Agreement of the
Company and FREMAR will appoint and compensate a CEO for the Company.

(2)           Construction, consulting, and management
services, including, but not limited to, assistance in obtaining construction
loan or loans, review of project plans and monitoring and management of
construction, and construction budget and timeline;

(3)           All management services, including, but
not limited to, the direct management and operations of the ethanol plant;

(4)           All management and supervision of certain
human resource matters and audit and accounting functions with respect to the
ethanol plant;

(5)           All management and supervision of the
purchasing of goods and services;

(6)           All management and supervision of the
payment of expenses;

(7)           All management and supervision of the
preparations of an annual budget;

(8)           All management and supervision of the
grain procurement;

(9)           All management and supervision of the
risk management, product marketing, preparation of tax returns, and maintenance
of books and records;

(10)         All management and supervision of the
business planning and budgeting related to the Company; and

(11)         Any and all other construction,
consulting, or management services reasonably necessary for the Company.

(b)           Notice of Change in Desired Services. 
The Company shall provide FREMAR with 180 days advance notice
of its intent to terminate any services being provided by FREMAR hereunder
and/or add new services, unless FREMAR agrees to a shorter period.  FREMAR shall begin to provide new services
requested by the Company as soon as reasonably practicable following the
request.  If the requested new services
are outside the scope of the services contemplated by this Agreement, the
parties shall agree on the rate of compensation to be paid to FREMAR for
providing these new services.  FREMAR is
not obligated to provide any new services before the rate of compensation for
those services is agreed to.

2.0          Manner
of Providing Services.  In providing
the services outlined in Section 1.0 of this Agreement, it is understood and
agreed that FREMAR may contract with any third party to provide such services
to the Company.  If FREMAR so contracts
with any other third party, the third party shall be bound to the same standard
of care as imposed on FREMAR under Section 6.0 of this Agreement.

3.0          Compensation
and Reimbursement of Costs.  As
compensation for the construction, consulting, and management services provided
by FREMAR hereunder beginning on the Agreement’s effective date, as stated
herein, until the Company obtains a construction loan or loans, the Company
agrees to pay FREMAR fees of $10,000.00 per month plus reimbursement for all
out-of-pocket expenses FREMAR incurs on the Company’s behalf, payable once the
construction loan or loans are obtained. 
After the Company obtains the construction loan or loans, the Company
agrees to pay FREMAR $35,000.00 per month as compensation for the construction,
consulting, and management services provided by FREMAR hereunder.  FREMAR hereby agrees that this compensation
is adequate for the services listed in Section 1.0(a).  If the Company requests new services, as
contemplated by Section 1.0(b), the parties shall agree to the rate of
compensation for those services and the manner of payment.

4.0          Books
and Records.  FREMAR must maintain a
system of internal controls sufficient to provide reasonable assurances that
the services are provided in accordance with the terms of this Agreement.  All books and accounts maintained by FREMAR
applicable to the performance of its obligations hereunder shall at all
reasonable times be open to inspection by the Company, and its auditors and
other representatives.

 2
 

5.0          Standard
of Care; Indemnification.

(a)           In performing the services hereunder, FREMAR and its
employees and agents shall perform their duties in a manner reasonably believed
by them to be in the best interest of the Company, subject always to the
control of the Board of Managers of the Company as to matters of the Company’s
policy, and with such care as an ordinarily prudent person in a like position
would use under similar circumstances. 
Neither FREMAR nor its officers, managers, employees or agents shall be
liable to the Company for any liability or loss suffered by the Company as a
result of any action or omission by FREMAR or its officers, managers, or
employees in performing the services hereunder, except that FREMAR shall be
liable to the Company to the extent, but only to the extent, of any direct
damages, as opposed to consequential damages, suffered by the Company that are
caused by the willful misconduct or negligence of FREMAR or its officers,
managers, employees, or agents, or by a material and continuing default by
FREMAR of its obligations hereunder.

(b)           The Company agrees to
indemnify and hold FREMAR, and its officers, directors, employees and agents,
harmless from all liabilities, costs and damages, including reasonable legal
fees, arising from or in connection with FREMAR’s performance of services on
behalf of the Company, provided, that FREMAR has satisfied its standard of care
as set forth in paragraph (a) of this Section 5.0.

6.0          Independent
Contractor Status.  FREMAR and its
employees and agents shall be deemed to be independent contractors with full
control over the manner and method of performance hereunder, except as
otherwise provided in Section 3.0 of this Agreement.  During the term of this Agreement, any of the
employees or agents of FREMAR that are rendering services on behalf of the
Company hereunder shall remain employees or agents, as the case may be of
FREMAR, and shall continue to be paid by FREMAR or its agents, as the case may
be, and to enjoy the benefits to which they are entitled as employees of FREMAR
or its agents, as the case may be, unless otherwise provided in any separate
agreement covering the services of such employee.

7.0          Separate
Entities.  FREMAR and the Company are
separate entities, and nothing in this Agreement or otherwise shall be
construed to create any rights or liabilities of any party hereto for any
rights, privileges, duties or liabilities of any other party hereto, except to
the extent otherwise provided herein or in any other agreement among the
parties hereto.

8.0          Term
and Termination.

(a)           Term.  The term of this Agreement shall commence on
the date hereof and shall continue for seven (7) years.

(b)           Renewal.  The
Agreement is automatically renewed for successive three (3) year periods,
provided that the Agreement may be terminated by either party upon 180-day
written notice prior to the beginning of the renewal period.

(c)           Termination.  The Company may
terminate the Agreement before the expiration of the term upon the affirmative
vote of two-thirds of the managers of the Company’s Board of Managers (other
than those appointed by FREMAR) “for cause”.  
Cause is defined as:

(1)           Intentional failure to
comply with applicable laws or regulations or unethical conduct that harms the
performance or financial results of the Company;

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(2)           FREMAR’s breach of a
material term of this Agreement;

(3)           Acts or conduct by
FREMAR which are/is willful, wanton, intentional, or knowing misconduct, or
which constitutes self dealing and/or gives right to improper profit on the
part of FREMAR in breach of a fiduciary duty or duty of loyalty that FREMAR owes
to the Company under this Agreement;

(4)           Substandard performance
of FREMAR with respect to the construction, consulting, and management services
provided hereunder for two consecutive years after notification after the first
year of substandard performance; or

(5)           A change of control or
dissolution of FREMAR.

9.0          Miscellaneous.  Neither party may assign or transfer all or
any part of this Agreement without prior written consent of the other, which
consent shall not be unreasonably withheld. 
The laws of the State of South Dakota shall govern this Agreement.  This Agreement may only be modified or
amended by an instrument in writing duly executed and delivered by the
parties.  In the event of any litigation
or arbitration to enforce this Agreement, the prevailing party shall be
entitled to reasonable attorneys’ fees and costs as fixed by the court or
arbitrator.  The terms and conditions set
forth above constitute the complete and exclusive statement of the agreement
between the parties relating to the subject matter hereof, superseding all
previous negotiations and understandings.

IN WITNESS WHEREOF, this
Agreement has been executed and delivered by the duly authorized officers or
representatives of each of the parties hereto, as of the date set forth above.

	
  

  	
  FREMAR
  FARMERS COOPERATIVE, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Its:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  MILLENNIUM
  ETHANOL, LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Its:

  	
   

  	
   

  
						

 

 4Exhibit 10.10

TM Rural Water District

Water User Agreement

This Agreement for the sale and purchase of water is
entered into and between TM Rural Water District, hereinafter referred to as “District”
and Millennium Ethanol, hereinafter referred to as “Water User”.

Witnesseth

WHEREAS, TM Rural Water District is organized as a
water user district under SDCL Chapter 46A-9, for the purpose of providing a
water system for the conservation, control, and distribution of treated water
for domestic, farm and other purposes; and

WHEREAS, the water user is the operator of an ethanol
plant to be located in Section 31, T100N R54W, Turner County, South Dakota; and

WHEREAS, the water user desires to purchase from the
District water to facilitate its ethanol production operations; and

WHEREAS, it is the purpose of this Agreement to set
forth the terms and conditions whereby water will be provided by the District
to the water user.

NOW THEREFORE, in consideration of the mutual
covenants, promises and agreements herein contained, it is hereby understood
and agreed that:

A. The District
Agrees:

1.                          Quality
and Quantity – Effective January 1, 2008, the District shall furnish Water
User, at the point of delivery hereinafter specified during the term of this
agreement or any renewal or extension thereof, treated water meeting applicable
water quality standards of

 1
 

the United States Environmental Protection Agency and the State of
South Dakota for industries of a like nature. The District shall further
provide the quantity as may be required by Water User, not to exceed a rate of
flow of 1000 gallons per minute.

Notwithstanding the foregoing, in the event The District is capable of,
and does in fact, furnish Water User with quantities of water exceeding those
limits contained herein, such action shall not be deemed to be a waiver of said
limitations as to the quantity of water to be furnished under the terms of this
Agreement.

The water delivered by the District shall meet the following quality
criteria:

Total Dissolved Solids not to exceed 650 milligrams per liter 

Alkalinity not to exceed 200 milligrams per liter 

Hardness not to exceed 200 milligrams per liter

2.                          Metering
Equipment- To operate and maintain at its own expense at point of delivery
the necessary metering equipment, including a meter house or pit, and required
devices of standard type for properly measuring the quantity of water delivered
to Water User.

3.                          Failure
to Deliver and Shortages- To operate and maintain its system in an
efficient manner at all times and take such action as may be necessary to
maintain its facilities to provide the Water User with quantities of water as
set forth in this Agreement. Temporary or partial failures to deliver water
shall be remedied with all possible dispatch. In the event of an extended
shortage of water, or if the supply of water available to The District is
otherwise diminished over an extended period of time, the supply of water to
Water User shall be reduced or diminished in the same ration or proportion as
the supply of other District consumers is reduced or diminished. In the event,
TM shall temporarily be unable to provide a sufficient water supply to the
Water User; the Water User may obtain water supplies

 2
 

from other sources without penalty or damages owed to the District.
However, at such time as TM recovers its ability to supply water to the Water
User in such quantities as formerly were provided, the Water User shall be
required to take steps to utilize TM as it primary water source before
utilizing water from any other water supply sources.

B. The Water User Agrees:

1.                          Minimum
Fee - To pay the District not later than the tenth (10th) day of each month beginning on February
1, 2008, the sum of ten thousand dollars ($10,000.00) as a minimum fee. Subject
to the terms of B3 below, this sum shall be paid to the District by the Water
User regardless of the obligation of the Water User to pay additional sums
calculated for gallons of water delivered.

2.                          Water
Rate - To pay the District, not later than the tenth (10th) day of each month, the following sums:

a)                         For
the first 43,200,000 gallons of water delivered each calendar month as
determined by the District’s metering equipment, One and 55/100 Dollars ($1.55)
for each 1,000 gallons used.

b)                        For
each 1,000 gallons of water delivered each month in excess of 43,200,000
gallons of water delivered as determined by the District’s metering equipment,
Two and 30/100 Dollars ($2.30) per thousand gallons used.

3.                          Credit
for Minimum Fee. The Water User shall be entitled to credit the amount paid as
the Minimum Fee against any sums calculated due under the water rate formula
found in B.2 a) and b) above.

 3
 

4.                          Obligation
to Deliver Water. That the District has no obligation to deliver any water
to Water User which exceeds that maximum quantity in this Water User Agreement
entered into between the parties.

5.                          Indemnify-Fire-
To hold the District harmless from any and all liability, expressed or implied,
arising out of or in connection with personal injuries or property damages
occasioned by fire within the Water User’s distribution system. In respect
thereto, Water User understands and agrees that The District does not warrant
or guarantee in any manner sufficient quantities of water to meet Water User’s
fire protection needs.

6.                          Backflow
Prevention. To operate and maintain a Reduced Pressure Principle Backflow
Prevention valve at the point the water service enters their building.

7.                          Water
User’s Distribution System- To be responsible for all services, maintenance
and repair of Water User’s distribution system extending from the point of
hookup with the District’s water system. Water User hereby holds The District
harmless from any and all liability, express or implied, arising out of or in
connection with personal injury or property damage resulting from Water User’s
operation, maintenance and repair of Water User’s distribution system. The
Water User agrees to provide on-site storage at their expense of not less than
200,000 gallons of water.

C. District and Water
User Mutually Agree:

1.                          Emergency
Failures- That emergency failures of pressure or supply due to main supply
line breaks, power failures, flood, fire, and use of water to fight fire,
earthquakes or other similar catastrophes shall excuse The District from
furnishing water as provided under

 4
 

paragraph “A.1.” for such reasonable period of time as may be necessary
to restore service.

2.                          Delinquent
Bills- That the sums due under paragraphs “B.1.” and “B.2.” above, if not
paid on or before the tenth (10th)
day of each month, shall be declared delinquent, and service may thereafter be
discontinued by The District after service of one (1) written notice provided
to the water user by first-class mail at their last known address. All bills
not paid by then tenth (10th) day
of each month shall be subject to a ten percent (10%) late charge.

3.                          Calibration
and Adjustment of Metering Equipment-

a)                         That
if Water User believes its meter reading to be in error, it shall present its
claim, in writing, at the District’s office before said bill is delinquent (not
later than the tenth (10th) day
of the month). Such claim, if made after the bill has become delinquent, shall
not be effective in preventing discontinuance of service for non-payment of a
water bill, as hereinafter provided. Water User must pay said bill under
protest and said payment shall not prejudice its claim of error.

b)                        Upon
presenting its claim of error in a meter reading, the meter will be calibrated
at Water User’s request, upon payment to The District of the actual cost of
calibration, provided however, that if the meter is found to over-register
beyond two percent (2%) of the correct volume, no charge to Water User will be
made.

c)                         Any
adjustments of Water User’s bill, in the event of over-registering of a meter,
as shown by calibration, shall be credited against future payments required of
the Water User of any amounts as set forth in this agreement.

4.                          Rate
Adjustments- With the exception of the initial rates, which shall be
guaranteed until December 31, 2010, it is agreed the rates herein

 5
 

stated in paragraphs B.2. a. and b. may be amended by the District on
an annual basis beginning January 1, 2011. The rates charged for water
delivered after January 1, 2011 shall be calculated on an “at cost” basis. The “at
cost” rate shall be calculated taking into account the factors contained in
Addendum 1 attached hereto and incorporated herein by reference, subject to the
condition that the “at cost” rate shall never be less than the rates referenced
in B.2. a. and b. above.

5.                          Rules
and Regulations. The provisions of the Rules and Regulations and policies
as adopted by the District shall be incorporated into and shall be made a part
of the terms of this Agreement as if more fully set forth herein.

6.                          Regulatory
Agencies- That this agreement is subject to such rules, regulations, or
laws as may be applicable to similar agreements in the State of South Dakota,
and Water User and The District will collaborate in obtaining such permits,
certificates, or the like, as may be required to comply therewith.

7.                          Collateral
Security- That any interest obtained by the District under this agreement
may be assigned as collateral security for any loan, bond(s), or debt
instrument entered into to finance construction, extension, repair or
maintenance of the District’s water supply system.

8.                          Modification
of Agreement- That this agreement shall be self-renewing subject only to
the annual adjustments to water rates, if any. Other provisions of this
agreement may be modified or altered by mutual agreement of the District and
the Water User.

9.                          Successor
to the District- That in the event of any occurrence rendering The District
incapable of performing under this agreement, any successor of the District,
whether the result of legal process,

 6
 

assignment, or otherwise, shall succeed to the rights of The District
hereunder.

In Witness Whereof, the parties, hereto, acting under
authority of their respective governing bodies, have caused this agreement to
be duly executed in three counterparts, each which shall constitute an
original.

	
   

  	
   

  	
   

  	
  TM RURAL WATER DISTRICT

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BY: 

  	
  /s/ [Illegible]

  
	
   

  	
   

  	
   

  	
  Its President

  

 

Attest:

	
  [Illegible]

  	
   

  	
   

  	
   

  
	
  DATE

  

  /s/ Steven Knutson

  	
   

  	
   

  	
   

  
	
  Secretary

  	
   

  	
   

  	
   

  

 

 

	
   

  	
  WATER USER:   

  	
  Millennium Ethanol, LLC

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  BY: 

  	
  /s/ Steve Domm

  
	
   

  	
   

  	
  TITLE:

  	
  CEO

  
					

 

STATE OF SOUTH DAKOTA

SS

COUNTY OF TURNER

On this the 14th day of June, 2006, before the undersigned
officer, personally appeared Steve Domm, known to me or satisfactorily proven
to be the person whose name is subscribed to the within instrument and
acknowledged that he executed the same of the purposes therein contained.

In witness whereof I have hereunto set my hand and
official seal.

	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
  /s/ [Illegible]

  
	
   

  	
   

  	
   

  	
  Notary Public, South Dakota

  

 

(SEAL)

	
  My commission expires 

  	
  11-29-2010.

  	
   

  

 

 7

Addendum 1

TM RURAL WATER DISTRICT

WATER COSTS

	
  Annual Expenses

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Personnel

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
  Transportation

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
  Source & Supply

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
  Distribution

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
  Administration, Insurance

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
  Prof. Services/Contracts

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
  Treatment

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
  Depreciation

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
  Total Expenses

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Water Sales

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Water Sold in gallons

  	
   

  	
   

  
	
   

  	
   

  	
   

  	
   

  	
   

  
	
  Cost of Water

  	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  	
  Annual Cost/ 1000 gallons

  	
   

  	
  $

  	
   

  
	
   

  	
   

  	
  Margin/ 1000 gallons

  	
   

  	
  $

  	
  0.10

  
	
   

  	
   

  	
  Total Cost/1000 gallons

  	
   

  	
  $

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