GRANITE FALLS -- Granite Falls Energy LLC and Glacial Lakes Energy LLC have reached a settlement ending their dispute over the operation and management agreement for the Granite Falls ethanol plant, the two jointly announced in a news release.
The terms of the settlement were not disclosed.
The settlement ends the costs and expenses associated with litigating the termination of the agreement, according to Paul Enstad, chairman of the Granite Falls Energy board of governors, and Jon T. Anderson, president of the Glacial Lakes Energy board of directors.
The settlement does not affect Glacial Lake's ownership of approximately 20.9 percent of the Granite Falls operation or its right to appoint two members to the Granite Falls board of governors. Neither the ownership nor governance rights were in dispute in the litigation, the news release stated.
Glacial Lakes Energy, a South Dakota cooperative, provided management services to Granite Falls Energy from prior to the start of operations at the plant in November 2005 until December 2006. Granite Falls Energy terminated the arrangement at that time and appointed Tracey Olson as CEO and general manager of the facility. He succeeded Tom Brahan, general manager with Glacial Lakes Energy, who resigned at the time.
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Glacial Lakes Energy disputed the termination, resulting in litigation and arguments between the two parties at the annual stockholder meeting. The management agreement had required Granite Falls Energy to pay a monthly management fee of $35,000 to Glacial Lakes Energy as well as an annual bonus representing 3 percent of the plant's income, according to information filed earlier with the Securities and Exchange Commission.
