UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): April 8, 2009
WESTERN IOWA ENERGY, LLC
(Exact name of registrant as specified in its charter)
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| Iowa | | 000-51965 | | 41-2143913 |
| (State or other Jurisdiction of Incorporation) | | (Commission File Number) | | (IRS Employer Identification No.) |
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1220 S. Center Street
P.O. Box 399
Wall Lake, Iowa
| | 51466 |
| (Address of Principal Executive Offices) | | (Zip Code) |
Registrant’s telephone number, including area code:(712) 664-2173
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| (Former name or former address if changed since last report.) |
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
o Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
o Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
o Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))
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Item 1.02 Termination of a Material Definitive Agreement
Management and Operational Services Agreement
On April 7, 2009, Western Iowa Energy, LLC (“WIE”) received from Renewable Energy Group, Inc. and its subsidiary, REG Services, LLC (collectively “REG”), a notice of termination of the Management and Operational Services Agreement (MOSA) entered into between WIE and REG on May 9, 2005. The MOSA provides that it will continue in effect for an initial term of three (3) years following the first month of biodiesel production at WIE’s plant and will continue thereafter until one party gives twelve (12) months advance written notice of termination. The April 7th letter from REG states that it shall constitute such twelve (12) month advance termination notice required by Section 5 of the MOSA.
WIE entered into the MOSA with REG for the purpose of management and operational services for its biodiesel plant. The terms of the MOSA obligate REG to manage the overall operations of WIE’s biodiesel plant and place a general manager and operations manager at the plant; procure the necessary feedstock and chemical inputs necessary to produce biodiesel at the plant; market and sell all of the biodiesel, glycerin and fatty acids produced at the plant; and perform human resources, accounting, information technology, payroll and other administrative services for WIE in exchange for a fixed fee per gallon of biodiesel produced at WIE’s plant plus a bonus based on WIE’s annual net income. WIE’s current general manager and operations manager are employed by REG and placed at WIE’s plant pursuant to the MOSA. The sales and marketing services performed by REG under the MOSA include identification of potential customers and establishment of sales opportunities; analysis and audit of biodiesel customers, including credit analysis; certain transportation services such as: arranging for transportation, logistics, and scheduling of biodiesel shipments; where advantageous, arranging for leased tankers for rail shipments; analyzing and auditing bulk transportation providers; overseeing reconciliation of shipments, invoicing and payments on a weekly basis; and providing invoicing and accounts receivable management for biodiesel shipments.
REG stated in the notice of termination that it was exercising its right to terminate the MOSA due to changes in the biodiesel market since the MOSA was originally signed. REG has proposed that the parties cooperate to negotiate a new contract on terms mutually beneficial to WIE and REG; however, there is no guarantee that a new agreement will be entered into between the parties.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
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| | | WESTERN IOWA ENERGY, LLC |
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| April 8, 2009 | | /s/ William J. Horan |
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| Date | | Willliam J. Horan, President |
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