Ethanol Sales And Marketing Agreement

Exhibit 10.16 ETHANOL SALES AND
MARKETING AGREEMENT THIS ETHANOL SALES AND MARKETING AGREEMENT (this " Agreement" ) is made effective as of December 8, 2006 (the " Effective Date" ) by and between Provista Renewable Fuels Marketing, LLC, with offices at 5500 Cenex Drive, Inver Grove Heights, MN 55077 (" Provista" ), and Amaizing Energy Denison, LLC, with offices at 2404 Highway 30 West, Denison, IA 51442 (" Customer" ). Any reference herein to a " Party" shall refer to Provista or Customer individually, and any reference herein to " Parties" shall refer to both Provista and Customer. RECITALS WHEREAS, Customer has constructed or plans to construct an ethanol production facility in Denison, IA (the " Facility" ); andWHEREAS, Customer desires to sell, and Provista desires to market on customer' s behalf, the entire output of ethanol (which is a clear odorless liquid produced for use as a motor fuel made from fermented grain being approximately 200 proof alcohol produced by Customer at the Facility, which also includes any blends, including but limited to E85, made from ethanol, and is referred to hereinafter as the " Ethanol" ) produced at the Facility; andWHEREAS, Customer and Provista each desire to agree in advance of such sale and purchase of the Ethanol to the price formula, payment, delivery and other terms thereof in consideration of the mutually agreed performance of the other pursuant to the terms of this Agreement; AGREEMENT NOW, THEREFORE, in consideration of the foregoing, and all of the representations, warranties, undertakings, covenants, promises and agreements set forth herein, which Customer and Provista each acknowledge are adequate and sufficient, Customer and Provista do hereby agree as follows:I. DEFINITIONS AND INTERPRETATION .A. Applicability . The definitions in this Section I. apply to this Agreement. Any word, phrase or expression that is not defined in this Agreement and that has a generally accepted meaning in the custom and usage in the ethanol industry in the United States shall have that meaning in this Agreement.B. " ASTM" is defined as the American Society for Testing and Materials. " ASTM D-4806" is the standard specification for denatured fuel ethanol to be blended with gasolines for use as an automotive spark-ignition engine fuel.C. " Buyer" is defined as the entity to whom Provista sells Ethanol.D. " Commencement Date" is defined as the day that Customer notifies Provista that the Facility is ready for operation. Or first day this contract is applicable, January 1, 2007.Ethanol Marketing Template Version 2.0 * Portions omitted pursuant to a request for confidential treatment and filed separately with the SEC.


E. " Execution Costs" are defined as: (i) the actual costs charged by a third party, or otherwise incurred, for freight and/or transportation of the Ethanol from the Facility to Buyer including, but not limited to, charges and fees for any and all rail car leases, Ethanol losses incurred as a result of the loading and unloading of the product during transportation process, interim storage and/or terminalling incurred prior to such delivery to Buyer, (ii) insurance, and (iii) all other costs and charges charged by a third party in connection with such transportation and delivery to Provista' s customer, without mark-up by Provista, and without charge for Provista' s administrative costs.F. " Facility" means Ethanol Production Plant at Denison, IA.G. " Gallon" means one U.S. gallon of Ethanol at 60 degrees Fahrenheit, in accordance with customary industry weights and measures.H. " Initial Term" is defined as a term of two (2) years from the Commencement Date.I. " Renewal Terms" are defined as consecutive terms of one (1) year each after the Initial Term unless this agreement is terminated as provided in Section II.A.II. TERM OF AGREEMENT; TERMINATION .A. Term . This Agreement shall be effective and binding as of the Effective Date; provided, however, that the obligations of Provista under this Agreement, and the obligations of Customer under this Agreement, shall commence on the Commencement Date and shall continue for the Initial Term. After the expiration of the Initial Term, this Agreement shall automatically renew for the Renewal Terms, unless terminated by Provista or Customer effective as of the end of the Initial Term, or the then existing one (1) year Renewal Term, upon at least ninety (90) days' prior written notice.B. Early Termination by Customer as a Result of Provista' s Breach . In the event that Provista fails or refuses to comply with any material provision of this Agreement, then Customer shall have the right to elect to terminate this Agreement by giving Provista at least thirty (30) calendar days' written notice prior to the effective date of termination, setting forth the reason(s) for termination. Provista shall have the right to cure the breach within such thirty (30) day period. If said breach is cured within such time period, the notice of termination to Provista shall be void. However, if the breach is not cured within such time period, the termination shall be effected. The exercise by Customer of any rights reserved under this Section shall be without prejudice to any claim for damages or for any other right under this Agreement or applicable law.C. Early Termination by Provista as a Result of Customer' s Breach . In the event that Customer fails or refuses to comply with any material provision of this Agreement, then Provista shall have the right to elect to terminate this Agreement by giving Customer at least thirty (30) calendar days' written notice prior to the effective date of termination, setting forth the reason(s) for termination. Customer shall have the right to cure the breach within such thirty (30) day period. If said breach is cured within such time period, the notice of termination to Customer shall be void. However, if the breach is not cured

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within such time period, the termination shall be effected. The exercise by Provista of any rights reserved under this Section shall be without prejudice to any claim for damages or any other right under this Agreement or applicable law.D. Survival . All obligations, promises and agreements of both Customer and Provista that expressly, or by their nature, survive the expiration or termination of this Agreement including, but not limited to, each of the Party' s monetary obligations and indemnification obligations herein, shall continue in full force and effect subsequent to, and notwithstanding, expiration or termination of this Agreement until they are satisfied, or by their nature expire.III. SALE AND MARKETING OF THE ETHANOL .A. Purchase and Sale . Customer agrees to sell to Provista, and Provista agrees to purchase from Customer, at prices determined in accordance with this Agreement, all of the Ethanol produced at the Facility, subject to all terms and conditions set forth in this Agreement; provided however that Provista shall be relieved of its obligation to purchase all of the Ethanol produced at the Facility when Provista presents a sales contract to Customer, and Customer, for whatever reason, declines to accept such sales contract. In such cases, Provista shall incur no liability for its failure to purchase all the Ethanol produced at the Facility. Provista agrees to purchase all the Ethanol delivered in accordance with this Agreement notwithstanding that the Facility may be operating at less than full capacity. Customer estimates, but it does not represent or warrant, that on an annual basis, it shall make available for delivery to Provista approximately 50 Million Annual gallons of Ethanol provided that each party hereto agrees that Customer has no obligation to produce such amount of Ethanol and shall incur no liability by reason of its failure to make such amount of Ethanol available for delivery except for any and all contractual commitments Provista may have entered into on behalf of Customer as of Effective Date or as otherwise specifically provided for herein.B. Delivery . For purposes of this Section III., " Delivery" of Ethanol is defined as the actual transfer of Ethanol to the possession of Buyer at the Delivery Point. For purposes of this Section III., " Delivery Point" is either: (1) the outlet flange transferring Ethanol into Buyer' s rail cars or trucks at the Facility, or (2) if such rail cars or trucks are not the Buyer' s, then when the Ethanol is delivered to Buyer' s specified destination, and the title will remain with Provista until such delivery. Provista and/or Provista' s agents shall be given access to the Facility as reasonably necessary for Provista and/or Provista' s agents to arrange for Delivery of the Ethanol to Buyer. With Customer' s consent, which consent shall not be unreasonably withheld or delayed, Provista shall schedule the loading and shipping of all outbound Ethanol purchased hereunder, but all labor and equipment necessary to load trucks and rail cars shall be supplied by Customer without charge to Provista. Execution Costs associated with the transportation of the Ethanol to Buyers will be reviewed by the " Marketing Committee" (as that term is defined in Section III.I. ) in an effort to help Customer maximize its net price for the Ethanol delivered hereunder.C. Handling and Title . Customer agrees to handle the Ethanol in a good and workmanlike manner in accordance with Provista' s reasonable written requirements conforming to normal industry practice. Customer shall maintain the truck and rail

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loading facilities at the Facility in safe operating condition in accordance with normal industry standards and will visually inspect all trucks and rail cars to assure cleanliness so as to avoid contamination from contaminants apparent to the naked eye. Customer shall be responsible for any loss, claim, damage and/or expense arising from, or out of: (i) Customer' s negligence in handling the Ethanol, and/or (ii) Customer' s failure to handle the Ethanol in accordance with Provista' s reasonable written requirements and normal industry practice including, but not limited to, loss, claim, damage and/or expense arising or out of trucks and/or rail cars that are overfilled at the Facility. Provista agrees that it will be responsible for any damage or injury to persons or property at the Facility as a result of Provista' s own negligence or willful misconduct and that Provista will follow all safety rules and procedures reasonably promulgated by Customer and provided to Provista in writing. In the event of a transfer to a Delivery Point as defined in Section III.B(1), title, risk of loss and full shipping responsibility shall pass to Provista, and then to Buyer, at the Delivery Point, subject to the terms and conditions of this Agreement. In the event of a transfer to a Delivery Point as defined in Section III.B(2), title, risk of loss, and full shipping responsibility shall pass to Provista upon the transfer of the Ethanol into the rail cars or trucks and pass to Buyer at the Delivery Point, subject to the terms and conditions of this Agreement.D. Storage at the Facility . Customer shall provide, at its sole cost, storage space at the Facility for the storage of up to 1.5 million gallons of Ethanol so as to provide flexibility in marketing efforts. Customer shall be responsible at all times for the quality and condition of the Ethanol in storage at the Facility.E. Production Estimates . Commencing on or before the fifteenth (15 th ) day of the month preceding the Commencement Date and continuing on the fifteenth (15 th ) day of each month during the term of this Agreement, Customer shall provide to Provista a 12-month rolling forecast of the volume of Ethanol to be produced and delivered by Customer for such 12-month rolling period. Customer shall immediately notify Provista of any changes to the Ethanol production estimate for such 12-month rolling period as soon as Customer has knowledge of the same. At least five (5) days prior to the beginning of the week during which it is to be removed by Provista, Customer may also provide a weekly estimate (the " Weekly Estimate" ) to Provista of the volume of the Ethanol (each such amount, a " Ethanol Parcel" ) to be produced and delivered by Customer together with a notice of the amount of the Ethanol in inventory as of the date of the notice.F. Transportation . Regardless of the amounts set forth in each Weekly Estimate, at least five (5) days prior to the beginning of the week during which Ethanol produced by Customer will be removed, Provista shall schedule for removal by truck or rail car the actual quantity of the Ethanol produced by Customer in the relevant week less the sum of such amount of the Ethanol that Provista and Customer agree shall be stored at the Facility. In the event that Customer fails to provide the labor, equipment and facilities necessary to meet Provista' s loading schedule, Customer shall be responsible for actual demurrage and wait time incurred by Provista resulting from Customer' s failure to do so. Provista shall order and supply trucks or rail cars as scheduled for truck or rail shipments. All Execution Costs shall be billed directly to Provista and deducted by Provista from the proceeds of Provista' s sales of the Ethanol to Buyer. Provista shall diligently pursue, secure and maintain all necessary agreements to transport the Ethanol

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and shall use commercially reasonable efforts to obtain the lowest charges in respect of Execution Costs in an effort to help Customer maximize its net price for the Ethanol delivered hereunder after deduction of Execution Costs in accordance with Section III.J. of this Agreement. On a daily basis, Customer shall inform Provista of the inventory and production status for the Facility by 8:30 a.m. CST. Customer agrees that it shall utilize all commercially reasonable efforts to purchased and install equipment for the electronic transfer of loading and inventory data to Provista on a continuous basis.G. Rail Car Leases . Provista shall supply Customer with assumptions and information required for Customer to determine the size of a rail car fleet for efficient disposition of Customer' s Ethanol production. From time to time during the term of this Agreement, and in order to help reduce Execution Costs and help Customer maximize its net price for the Ethanol delivered hereunder, Provista may enter into rail car leases for the transportation of the Ethanol in order to service Customer (" Rail Car Leases" ). For any Rail Car Leases entered into by Provista hereunder, Customer represents and warrants that it shall be responsible for any and all costs associated with such Rail Car Leases and the use of the rail cars. Provista shall communicate to Customer the terms and conditions of the Rail Car Leases. Upon receipt of such information, an officer or authorized representative of Customer, shall in writing acknowledge the terms of the Rail Car Leases. NOTWITHSTANDING THE ABOVE, CUSTOMER' S FAILURE TO (1) ACKNOWLEDGE THE TERMS OF THE RAIL CAR LEASES OR (2) HAVE AN OFFICER OR AUTHORIZED REPRESENTATIVE SIGN THE AFOREMENTIONED RAIL CAR LEASE TERM LETTER, IN EITHER INSTANCE, SHALL IN NO WAY ABSOLVE CUSTOMER OF ITS OBLIGATIONS TO PROVISTA REGARDING SUCH RAIL CAR LEASES AS PROVIDED HEREIN. Provista shall provide Customer with notice of the schedule for all truck and railcar shipments no less than forty-eight (48) hours prior to their scheduled arrival at the Facility, as well as an estimate of the associated Execution Costs.In order to maximize the efficiencies of the rail cars leased under the Rail Car Leases, Customer agrees that Provista may, from time to time, utilize Customer' s rail cars for other Provista customers if such rail care are not needed, or bring in additional rail cars from other Provista customers for Customer when additional are required. Customer will receive the benefit of any cost reduction when its rail cars are utilized elsewhere, and will likewise, be responsible to pay for any increased costs associated with utilizing other Provista customer' s rail cars.Upon the expiration of the Agreement or in the event of Customer' s early termination of the Agreement (other than as a direct result of Provista' s breach), Provista agrees that it shall use commercially reasonable efforts to secure the Rail Car lessor' s consent to the assignment or consent to the sublease of the Rail Car Leases from Provista to Custo ...