SCHEDULE 14A
Friday, June 17, 2022
Friday, June 17, 2022, at Prairie’s Edge Casino Resort, 5616 Prairie’s Edge Lane, Granite Falls, Minnesota.
We recommend members attend the meeting via Zoom teleconferencing and vote by proxy. A very limited number of members may be able to intend the meeting in person at our office, 15045 Highway 23 S.E. Granite Falls, MN. However, due to Covid-19 restrictions, the meeting room will have limited capacity. If you come to the meeting in person, we will accept your proxy and count your votes, but you may be unable to enter the meeting room or participate in the meeting due to capacity restrictions. Accordingly, we encourage members to participate via Zoom.
Zoom Teleconference Instructions
Members must register to attend the meeting via Zoom. To register, log on to our website, http://www.granitefallsenergy.com/, click on the tab "Annual Meeting" for registration instructions, or log on the following webpage: https://zoom.us/webinar/register/WN_dZOUPXRgQGm5gjUVuvZwYQ. You may also register by calling our office at (320) 564-3100 prior to 5:00 p.m. March 23. Once registered, you will be provided instructions for participating in the meeting by computer or phone.
By order of the board of governors,
/s/ Paul Enstad
Thursday, June 16, 2022.
| | | | By order of the board of governors, | | | | |
| | | | /s/ Paul Enstad PAUL ENSTAD, Chairman | | |
Chairman
Granite Falls, Minnesota
February 26, 2021
2021
Friday, June 17, 2022
May 23, 2022.
• Proxy Proposals: This section provides information and detailed explanation of the proposals to be voted on at the 2022 annual meeting. There is one proposal being presented for your consideration at the 2022 annual meeting: elect three governors from the four nominees listed below to serve on the Company’s board of governors. The three elected governors will serve until the 2025 annual meeting of members and until their successors are elected; and • Required Information: This section provides information that is required by law to be included in the Company’s proxy statement, which has not been included in Sections I and II. |
SECTION I - QUESTIONS AND ANSWERS ABOUT THE
2021
2022 ANNUAL MEETING AND VOTING
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| A: You |
As stated above, members may revoke theiryour proxy by votingby:
commencement of the 2022 annual meeting.
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| A: This question is answered in the section of this proxy statement entitled “SECTION III - REQUIRED INFORMATION; Member Proposals for the 2022 Annual Meeting.” Q: Who is paying for this proxy solicitation? A: The entire cost of this proxy solicitation will be borne by the Company. The cost will include the cost of supplying necessary additional copies of the solicitation material for beneficial owners of membership units held of record by brokers, dealers, banks and voting trustees and their nominees and, upon request, the reasonable expenses of such record holders for completing the mailing of such material and report to such beneficial owners. Q: How can I find out results of the voting at the 2022 annual meeting? A: Preliminary voting results will be announced at the 2022 annual meeting. In addition, final voting results will be published in a current report on Form 8-K that we expect to file within four business days after the 2022 annual meeting. If final voting results are not available to us in time to file a Form 8-K within four business days after the meeting, we intend to file a Form 8-K to publish preliminary results and, within four business days after the final results are known to us, file an additional Form 8-K to publish the final results. |
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FORWARD-LOOKING STATEMENTS
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of this proxy statement. You should read this proxy statement and the documents that we reference in this proxy statement, completely and with the understanding that our actual future results may be materially different from what we currently expect. We qualify all of our forward-looking statements by these cautionary statements.
Except for Messrs. Enstad, Goulet, Wilkison, none
Name | | | Age | | | Year First Became a Governor (if applicable) | | | Term Expires (if applicable) | | |||||||||
Dean Buesing | | | | | 69 | | | | | | 2009 | | | | | | 2022 | | |
Sherry Jean Larson | | | | | 47 | | | | | | 2016 | | | | | | 2022 | | |
Robin Spaude | | | | | 72 | | | | | | 2019 | | | | | | 2022 | | |
| | | | | ||
Name | | Age | | Year First Became a Governor (if applicable) | | Term Expires (if applicable) |
| 61 | | 2000 | | 2021 | |
David Forkrud | | 69 | | N/A | | N/A |
Marten Goulet | | 41 | | 2012 | | 2021 |
Rodney Wilkison | | 66 | | 2006 | | 2021 |
Each of Messrs. Enstad, Goulet,Buesing and WilkisonSpaude and Ms. Larson are incumbent governors.
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Cooperative Elevator Company, a member of the Company, from 1996 to 2011. Mr. Enstad also serves as one of the Company’s appointed governors to the board of governors of HLBE, as well as the chairman of HLBE. From September 2013 through March 2018 Mr. Enstad served as one of HLBE’s four appointed managers to the board of managers of Agrinatural Gas, LLC, a majority owned subsidiary of HLBE (“Agrinatural”), representing HLBE’s investment interest in Agrinatural. Mr. Enstad was selected as a nominee based on his deep knowledge about the Company and its industry, his valuable leadership to the Company and the Board, and his business experience.
David Forkrud - Nominee. Mr. Forkrud has managed farmer-owned cooperatives for 42 years, recently retiring in 2016. Mr. Forkrud continues to work part-time for Farmer’s Co-op Oil Co. of Echo selling grain handling equipment. He was elected County Commissioner in the fall of 2016 for Redwood County. Mr. Forkrud was and is a promoter of ethanol. Mr. Forkrud was selected as a nominee based on his business knowledge and experiences, in addition to his knowledge of the industry.
Rodney Wilkison - Incumbent Nominee. Mr. Wilkison was initially appointed to a Board seat in December 2006 and was elected as a governor in 2007. Since 1985, Mr. Wilkison has been the owner and chief executive officer of Wilkison Consulting Service, which provides financial consulting, tax preparation, and monthly accounting services for farmers and small businesses. Prior to starting his consulting business, Mr. Wilkison worked for two different banks for more than eleven years. Mr. Wilkison graduated from Pipestone Area Vocational Technical Institute with a degree in agricultural banking. Mr. Wilkison also serves as one of our appointed governors to the board of governors of HLBE, as well as the vice-chairman and chair of the audit committee of HLBE. Mr. Wilkison has served as a member and chairman of the Company’s audit committee since his election as a governor in 2007. Mr. Wilkison was selected as a nominee based on his prior experience with the Company, his business, financial and accounting knowledge, and his ability to serve as an audit committee financial expert.
Marten Goulet - Incumbent Nominee. Mr. Goulet was first elected as a governor in 2012. Since June 2012, Mr. Goulet has been the chief financial officer of Wagner Construction, an underground utility and site development contractor based in International Falls, Minnesota with operations in Arizona, Arkansas, Colorado, Michigan, Minnesota, Montana, South Dakota, North Dakota, and Canada. Prior to joining Wagner Construction, Mr. Goulet spent eight years with Wells Fargo in the Twin Cities managing banking relationships and providing financial services to companies in the construction, manufacturing, wholesaling, and service-related industries with annual revenues of $20 million to $1 billion. Mr. Goulet is the President of Voyageur Capital Group, a private equity fund, and founder of Highland Pellets, which owns and operates a wood pellet plant in Pine Bluff, Arkansas. Mr. Goulet received his Bachelor of Arts in finance from Bemidji State University and his M.B.A. in accounting from the University of St. Thomas in St. Paul, Minnesota. He also serves as one of our appointed governors to the board of governors of HLBE, as well as a member of the audit committee of HLBE. Mr. Goulet has served as a member of the Company’s audit committee since his election as a governor in 2012. He also serves on the Company’s nominating committee. Mr. Goulet was selected as a nominee based on his prior experience with the Company along with his business experiences, his education and financial acumen, and his ability to serve as an audit committee financial expert.
Effect of Your Proxy
There are four nominees and three open seats for governor. You may only mark one voting choice with respect to each nominee: “FOR” or “WITHHOLD/ABSTAIN.” THE BOARD HAS DETERMINED THAT EACH NOMINEE IS QUALIFIED TO SERVE AS A GOVERNOR. FOR EACH PROPERLY EXECUTED PROXY CARD WHERE THE MEMBER DOES NOT MARK ANY CHOICES FOR GOVERNOR, THE PROXIES WILL VOTE FOR THE INCUMBENT GOVERNOR NOMINEES PAUL ENSTAD, MARTEN GOULET, AND RODNEY WILKISON.
Abstentions (voting “WITHHOLD/ABSTAIN”) will not be counted either for or against any nominee because governors are elected by plurality vote, meaning that the person receiving the most votes will be elected. Abstentions will be included when counting membership units to determine whether a sufficient number of the voting membership units are represented to establish a quorum.
If you mark contradicting choices on your proxy card such as both for and abstain for a nominee, your votes will not be counted with respect to the nominee for whom you marked contradicting choices.
If at the time of the 2021 annual meeting any nominee is unable or declines to serve, the proxies will vote for the election of such substitute nominee as the Board may recommend. Our Board has no reason to believe that any substitute nominee(s) will be required.
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Required Vote and Board Determination
In the election of governors, the affirmative vote of a plurality of the membership voting interests is required to elect a nominee to the position of governor. Therefore, the three nominees receiving the greatest number of votes will be elected, regardless of whether any individual nominee receives votes from a majority of the quorum. Members do not have cumulative voting rights.
The Board has determined that each nominee is qualified to serve as a governor.
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SECTION III - REQUIRED INFORMATION
SECURITY OWNERSHIP OF GOVERNORS, NOMINEES, EXECUTIVE OFFICERS
AND CERTAIN BENEFICIAL OWNERS
The following table provides certain information as of February 21, 2021, with respect to the unit ownership of: (i) those persons or groups (as that term is used in Section 13(d)(3) of the Securities Exchange Act of 1934, as amended ) who beneficially own more than beneficial owners owning or holding 5% or more of our outstanding units; (ii) each governor of the Company, (iii) each named executive officer of the Company (as defined in the “Summary Compensation Table” below); and (iv) all officers, governors, and nominees, as a group. Except as noted below, the persons listed below possess sole voting and investment power over their respective units. No family relationships exist among our governors and executive officers.
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Title of Class | | Name and Address of Beneficial Owner (1) | | Position with the Company | | Amount and Nature of Beneficial Ownership (2) | | Percent of Class (3) | ||
Governors and Executive Officers | | | | | | | | | ||
Membership Units | | Leslie Bergquist | | Governor | | 15 | units | | — | %* |
Membership Units | | Dean Buesing (4) | | Governor, Secretary | | 635 | units | | 2.07 | % |
Membership Units | | Steve Christensen | | Chief Executive Officer & General Manager | | — | units | | — | % |
Membership Units | | Paul Enstad (5) | | Governor, Chairman & Incumbent Nominee | | 125 | units | | — | %* |
Membership Units | | Marten Goulet (6) | | Governor & Incumbent Nominee | | 50 | units | | — | %* |
Membership Units | | Sherry Jean Larson | | Governor | | 5 | units | | — | %* |
Membership Units | | Stacie Schuler | | Chief Financial Officer | | 5 | units | | — | %* |
Membership Units | | Martin Seifert | | Alternate Governor | | 2 | units | | — | %* |
Membership Units | | Rodney Wilkison (7) | | Governor, Vice Chairman & Incumbent Nominee | | 100 | units | | — | %* |
Membership Units | | Kenton Johnson | | Governor | | 10 | units | | — | %* |
Membership Units | | Bruce LaVigne (8) | | Governor | | 500 | units | | 1.63 | % |
Membership Units | | Robin Spaude (9) | | Governor | | 55 | units | | — | %* |
Membership Units | | David Forkrud | | Nominee | | 10 | units | | — | %* |
| | All Governors, Officers and Nominees as a Group: | | 1,512 | units | | 4.94 | % | ||
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Other Members Owning or Holding 5% or More of Our Outstanding Units: | | | | | | | ||||
Membership Units | | Glacial Lakes Energy, LLC 301 20th Avenue SE Watertown, SD 57201 | | | | 5,004 | units | | 16.35 | % |
Membership Units | | Fagen, Inc. 501 W. Highway 212 P.O. Box 159 Granite Falls, MN 56241 | | | | 4,071 | units | | 13.30 | % |
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(9) Includes 55 units owned jointly with Mr. Spaude’s spouse.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities and Exchange Act of 1934, as amended (the “Exchange Act”), requires our officers and governors, and persons who own more than 10% of a registered class of our equity securities, to file reports of ownership and changes in ownership with the Securities and Exchange Commission (the “SEC”). Officers, governors and greater than 10% beneficial owners are required by SEC regulations to furnish us with copies of all Section 16(a) forms they file. The Company is required to disclose in this Proxy Statement any failure to file or late filings of such reports with respect to the most recent fiscal year.
Based solely upon a review of copies of forms furnished to the Company or written representations from certain reporting persons that no Form 5s were required for such covered persons, we believe that all Section 16(a) filing requirements applicable to each covered person were satisfied during the 2020 fiscal year.
CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS
Except as disclosed below or “Compensation of Governors” and “Compensation of Executive Officers,” we have not entered into any transaction since the beginning of fiscal year 2020 and there are no currently proposed transactions, in which we were or are to be a participant and the amount involved exceeds $120,000 and in which any related person had or will have a direct or indirect material interest. The term “related person” as defined in Item 404(a) of Regulation S-K refers to our directors, executive officers, holders of more than 5% of our outstanding units and the immediate family members of any of those persons. No direct family relationships exist between any of the governors of the Board, officers, or key employees of the Company.
Related Party Transaction Approval Policy
During fiscal year 2020, we had no written related-party transaction policy. However, our operating and member control agreement requires that all future transactions with related persons will be no less favorable to us than those generally available from unaffiliated third parties and that all such related party transactions must be approved by a majority of the disinterested governors.
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Corn Transactions
In the ordinary course of business, we regularly enter into transactions to buy grain. From time to time, we may buy grain from related persons on the same basis as we buy grain from unrelated parties. For the fiscal year ended October 31, 2020, we purchased approximately $4.90 million of corn from board members, consisting of approximately $1.5 million from Enstad Brothers Partnership, of which Paul Enstad is a partner; approximately $2.5 million from Buesing Ag Partnership, of which Dean Buesing is a partner; approximately $470,000 from Prairie View Farms, which is controlled by Kenton Johnson; and approximately $63,000 from Michael Lund prior to the expiration of Lund’s term as a board member.
BOARD OF GOVERNORS’ AND COMPANY GOVERNANCE
Board Leadership Structure
The Company is managed by a chief executive officer, who is separate from the chairman of the Board. Steve Christensen is our general manager and chief executive officer, while Paul Enstad is the chairman of the Board. Separation of the two offices is not mandated by the Company’s Operating and Member Control Agreement or corporate governance guidelines and policies. However, we have determined that the current separation of the two roles allow our chief executive officer to manage our day-to-day operations while allowing our chairman to focus on leading our Board in its duty to act in our best interests and those of the members. We believe this leadership structure allows our Board to best focus on its oversight role, providing us a perspective that is independent from that of our management and creating checks and balances on the executive officers of the Company.
Our Board reserves the right to determine the appropriate leadership structure from time to time.
Board’s Role In Risk Oversight
Although management is responsible for the day-to-day management of risks to the Company, our full Board is actively involved in providing broad oversight of the Company’s risk management programs. In this oversight role, our Board is responsible for satisfying itself that the risk management processes designed and implemented by the Company’s management are functioning and that the systems and processes in place will bring to its attention the material risks facing the Company to permit the Board to effectively oversee the management of these risks.
A fundamental part of risk management is not only understanding the risks a company faces and what steps management is taking to manage those risks, but also understanding what level of risk is appropriate for the Company. The involvement of our full Board in the risk oversight process allows our Board to assess management’s appetite for risk and also determine what constitutes an appropriate level of risk for the Company. Our Board regularly includes agenda items at its meetings relating to its risk oversight role and meets with various members of management on a range of topics, including corporate governance and regulatory obligations, operations and significant transactions, business continuity planning, succession planning, risk management, insurance, pending and threatened litigation and significant commercial disputes.
While our Board provides broad oversight of the Company’s risk management processes, various committees of the Board oversee risk management in their respective areas and regularly report on their activities to our full Board. Principally, the risk management committee assists our Board in identifying and quantifying methods of mitigating or eliminating risk, principally those relating to commodity prices. Our audit committee focuses on assessing and mitigating financial risk, including internal controls over financial reporting. Our three-member executive board, functioning as our compensation committee, oversees risks and relevant risk controls related to the Company’s compensation policies, programs and procedures, including the incentives they create, to encourage a level of risk-taking behavior consistent with the Company’s business strategy.
We believe the division of risk management responsibilities described above is an effective approach for addressing the risks facing the Company and that our Board leadership structure provides appropriate checks and balances against undue risk taking.
Governors
Our current Board consists of nine elected governors. Under our current Operating and Member Control Agreement, the governors’ terms are staggered such that three governors are up for election each year. Nominees for governor are nominated by our Board, following consideration by our Board’s nominating committee, and then elected by our members.
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The chart below lists the governors whose terms continue after the 2021 annual meeting and the incumbent governor nominees whose terms expire at the 2021 annual meeting. The address for all governors is 15045 Highway 23 S.E., Granite Falls, Minnesota, 56241-0216.
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Name | | Age | | Year First Became a Governor | | Term Expires |
Paul Enstad | | 61 | | 2000 | | 2021 |
Marten Goulet | | 41 | | 2012 | | 2021 |
Rodney Wilkison | | 66 | | 2006 | | 2021 |
Dean Buesing | | 68 | | 2009 | | 2022 |
Sherry Jean Larson | | 45 | | 2016 | | 2022 |
Robin Spaude | | 71 | | 2019 | | 2022 |
Kenton Johnson | | 32 | | 2013 | | 2023 |
Bruce LaVigne | | 70 | | 2014 | | 2023 |
Leslie Bergquist | | 61 | | 2013 | | 2023 |
Martin Seifert | | 48 | | 2011 | | * |
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Except for directors Enstad, Goulet, Wilkison, Buesing, Johnson, Seifert and Spaude, none of the directors listed above currently serve on the board of directors of any other company having a class of securities registered under Section 12 of the Exchange Act or subject to the requirements of Section 15(d) of the Exchange Act, nor have any of our directors served as directors of an investment company registered under the Investment Company Act. Each of Messrs. Enstad, Goulet, Wilkison, Buesing, and Johnson serves as the Company’s appointed governors to the board of governors of HLBE, our majority-owned subsidiary and a publicly reporting company. Each of governors Seifert and Spaude serves as the Company’s alternate appointed governors to the board of governors of HLBE.
Biographical Information for Governors Continuing in Office
Set forth below is certain information with respect to our governors whose terms continue after the 2021 annual meeting, including the business experience and the experiences, qualifications, attributes or skills, our Board believes qualifies these individuals to serve as governors. Biographical information for the nominee incumbent governors whose terms expire at the 2021 annual meeting may be found above at “SECTION II - PROPOSALS TO BE VOTED UPON,Election of Governors - Information Regarding Nominees.”
Dean Buesing - Governor and Secretary of the Board. Mr. Buesing has served as a governor of the Company since 2009. Mr. Buesing and his brother have been farming near Granite Falls since 1973, raising corn and soybeans. Since 1980, he has served as president of Buesing Farms, Inc. He is also president of Buesing-Buesing, LLC, which is a farming operation formed in 2006. In 2007, Buesing Ag Partnership was formed, in which he is a partner with his brother and nephew. Mr. Buesing was a director of Minnesota Corn Processors, LLC, an ethanol production facility located near Marshall, Minnesota from 1998 until 2002 when it was acquiredbought by Archer Daniels Midland. While a director of Minnesota Corn Processors, LLC, he also served on the long-range planning and development committee. From 2007 to 2011, Mr. Buesing served as a director and secretary of SW Energy, LLC, a development stage ethanol production facility located near McCook, Nebraska. From 1992 to 2000, he was also a director and treasurer of Yellow Medicine Soybean Growers. He is also currently a member of the Minnesota Soybean and Corn Growers Associations. Mr. Buesing also servespreviously served as a governor of HLBE.HLBE Mr. Buesing is a member of the Company’s executive board and nominating committee for the Company. The Board believes Mr. Buesing’s industry knowledge and experience in the ethanol industry make him a valuable member of the Board.
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accountant byat Schlenner Wenner & Co. in St. Cloud, Minnesota from November 1997 to July 2001. She graduated from the University of Evansville with hera bachelor’s degree in accounting and from St. Cloud State University with a master’s degree in business administration. Ms. Larson serves as one of our alternate governors to the board of governors of HLBE. She also serveswas selected as a member of the Company’s audit committee and nominating committee. Ms. Larson’snominee based on her business experience, knowledge of the ethanol industry, education and financial acumen make her a valuable member of the Board.
acumen.
| Title of Class | | | Name and Address of Beneficial Owner (1) | | | Position with the Company | | | Amount and Nature of Beneficial Ownership (2) | | | Percent of Class (3) | | ||||||
| Governors and Executive Officers | | ||||||||||||||||||
| Membership Units | | | Leslie Bergquist | | | Governor | | | | | 15 units | | | | | | —%* | | |
| Membership Units | | | Dean Buesing (4) | | | Governor, Secretary & Incumbent Nominee | | | | | 635 units | | | | | | 2.07% | | |
| Membership Units | | | Jeffrey Oestmann | | | Chief Executive Officer & General Manager | | | | | — units | | | | | | —% | | |
| Membership Units | | | Paul Enstad (5) | | | Governor & Chairman | | | | | 118 units | | | | | | —%* | | |
| Membership Units | | | David Forkrud(6) | | | Governor | | | | | 10 units | | | | | | —%* | | |
| Membership Units | | | Sherry Jean Larson | | | Governor & Incumbent Nominee | | | | | 5 units | | | | | | —%* | | |
| Membership Units | | | Stacie Schuler(7) | | | Chief Financial Officer | | | | | 5 units | | | | | | —%* | | |
| Membership Units | | | Martin Seifert | | | Alternate Governor | | | | | 2 units | | | | | | —%* | | |
| Membership Units | | | Rodney Wilkison (8) | | | Governor & Vice Chairman | | | | | 100 units | | | | | | —%* | | |
| Membership Units | | | Kenton Johnson | | | Governor | | | | | 10 units | | | | | | —%* | | |
| Membership Units | | | Bruce LaVigne (9) | | | Governor | | | | | 500 units | | | | | | 1.63% | | |
| Membership Units | | | Robin Spaude (10) | | | Governor & Incumbent Nominee | | | | | 95 units | | | | | | —%* | | |
| | | | All Governors, Officers and Nominees as a Group: | | | | | 1,495 units | | | | | | 4.88% | | | |||
| Other Members Owning or Holding 5% or More of Our Outstanding Units: | | | | | | | | | | | | | | ||||||
| Membership Units | | | Glacial Lakes Energy, LLC 301 20th Avenue SE Watertown, SD 57201 | | | | | | | | 5,004 units | | | | | | 16.35% | | |
| Membership Units | | | Fagen Holdings, Inc.(11) 501 W. Highway 212 P.O. Box 159 Granite Falls, MN 56241 | | | | | | | | 4,071 units | | | | | | 13.30% | | |
Name | | | Age | | | Year First Became a Governor | | | Term Expires | | |||||||||
Paul Enstad | | | | | 62 | | | | | | 2000 | | | | | | 2024 | | |
David Forkrud | | | | | 70 | | | | | | 2021 | | | | | | 2024 | | |
Rodney Wilkison | | | | | 67 | | | | | | 2006 | | | | | | 2024 | | |
Dean Buesing | | | | | 69 | | | | | | 2009 | | | | | | 2022 | | |
Sherry Jean Larson | | | | | 47 | | | | | | 2016 | | | | | | 2022 | | |
Robin Spaude | | | | | 72 | | | | | | 2019 | | | | | | 2022 | | |
Kenton Johnson | | | | | 33 | | | | | | 2013 | | | | | | 2023 | | |
Bruce LaVigne | | | | | 71 | | | | | | 2014 | | | | | | 2023 | | |
Leslie Bergquist | | | | | 62 | | | | | | 2013 | | | | | | 2023 | | |
Martin Seifert | | | | | 49 | | | | | | 2011 | | | | * | |
He also served as an appointed director of Agrinatural from September 2013 until March 2018, representing HLBE’s investment interest in Agrinatural. Mr. Bergquist’s experience as an executive, his knowledge of the agricultural industry, and his financial acumen and audit committee experience make him a valuable member of the Board.
Leslie Bergquist - Governor.Mr. Bergquist served as a governor of the Company from 2013 to 2019. Since January 2012, Mr. Bergquist has owned and served as president of Bergquist Consulting Corporation, which provides commercial and agricultural loan reviews and appraisal reviews. Mr. Bergquist also serves as a farm manager for Fagen Farms, LLP, which is an affiliate of Fagen, Inc., and as a bus driver for Bennett & Bennett Transportation, Inc. Mr. Bergquist previously served as a senior credit analyst for Forstrom Bancorporation, Inc. from May 2007 through December 2011, and held the positions of president,
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vice president, and director during his tenure with Yellow Medicine County Bank, which spanned from August 2002 through May 2007. During his prior tenure as a governor of the Company, Mr. Bergquist also served as a one of our appointed governors to the board of governors of HLBE and as a member of the audit committee of HLBE. He also served as an appointed director of Agrinatural from September 2013 until March 2018, representing HLBE’s investment interest in Agrinatural. Mr. Bergquist’s experience as an executive, his knowledge of the agricultural industry, and his financial acumen and audit committee experience make him a valuable member of the Board.
Martin Seifert - Alternate Governor.Mr. Seifert was first appointed by the Board as an alternate governor in May 2011. Since December 2014, Mr. Seifert has been employed as a lobbyist with the firm of Flaherty and Hood, P.A. in St. Paul, Minnesota. Previously, he was the executive director of the Avera Marshall Foundation from 2010 to 2013, which provides financial support for the Marshall Regional Medical Center hospital and long term care facility. Mr. Seifert has also been a realtor with Real Estate Retrievers from 2010 to 2014. Mr. Seifert was a member of the Minnesota House of Representatives from 1996 to 2011. He also served as minority leader in the Minnesota House of Representatives from 2006 to 2009. Mr. Seifert graduated from Southwest Minnesota State University in 1995 with a Bachelor of Arts in political science. Mr. Seifert alsopreviously served as an alternate appointed governor of HLBE and serves on the board of directors of Catholic United Financial. Mr. Seifert provides significant assistance to our Board in the Company’s interaction with all levels of local and state government and also provides an independent, long-term view of the further development of Company’s site and business.
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The Board’s three member non-employee executive board serves as our compensation committee. The executive board is responsible for discharging the Board’s responsibilities relating to compensation of our Company’s executive officers. The executive board has the authority to approve and make recommendations to the Board with respect to the compensation of the chief executive officer of the Company and evaluates the chief executive officer’s performance in light of his goals and objectives, as determined by the executive board. The executive board consults with the chief executive officer with respect to compensation for the Company’s
2021.
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Mr. Wilkison serves as our audit committee financial expert. Mr. Wilkison’s experience as the owner and chief executive officer of Wilkison Consulting Service, which provides financial consulting, tax preparation, and monthly accounting services for farmers and small businesses, qualifies him to be the audit committee’s financial expert.
2021.
Marten Goulet
| Category | | | Fiscal Year | | | Fees | |
| | Audit Fees(1) | | | | | | 2021 | | | | | | $ | $268,562 | | | |
| | | | | | | | 2020 | | | | | | $ | 167,440 | | | |
| | Tax Fees(2) | | | | | | 2021 | | | | | | $ | 25,740 | | | |
| | | | | | | | 2020 | | | | | | $ | 28,620 | | | |
| | All Other Fees(3) | | | | | | 2021 | | | | | | $ | 14,560 | | | |
| | | | | | | | 2020 | | | | | | $ | 17,240 | | | |
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Category | | Fiscal Year | | Fees | |
Audit Fees(1) | | 2020 | | $ | 167,440 |
| | 2019 | | $ | 144,500 |
Tax Fees(2) | | 2020 | | $ | 28,620 |
| | 2019 | | $ | 23,200 |
All Other Fees(3) | | 2020 | | $ | 17,240 |
| | 2019 | | $ | 28,400 |
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The nominating committee oversees the identification and evaluation of individuals qualified to become governors and recommends to the Board the governor nominees for each annual meeting of the members. The major responsibilities of the nominating committee are to:
January 23, 2023.
2021.
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The executive board is exempt from independence listing standards because our securities are not listed on a national securities exchange or listed in an automated inter-dealer quotation system of a national securities association or to issuers of such securities. However, as discussed above, Mr. Wilkison is independent as defined by NASDAQ Rule 5605(a)(2). Messrs. Enstad and Buesing are not “independent” because each, through their respective affiliates, sold a significant amount of grain to us in fiscal year 2020,2021, as discussed above under the section titled “Certain Relationships and Related Transactions.”
greater than four hours in length; $150 for attending committee or other additional meetings (excluding audit committee meetings) less than four hours in length.
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Governor | Fees Earned or Paid in Cash ($) (1) | Additional Compensation ($) (2) | Total Compensation ($) | |||||
Paul Enstad | $ | 19,163 | | $ | 18,919 | (3) | $ | 38,082 |
Rodney Wilkison | $ | 16,725 | | $ | 19,535 | (4) | $ | 36,260 |
Dean Buesing | $ | 18,025 | | $ | 12,955 | (5) | $ | 30,980 |
Marten Goulet | $ | 14,475 | | $ | 28,645 | (6) | $ | 43,120 |
Robin Spaude | $ | 11,325 | | $ | 460 | $ | 11,785 | |
Sherry Jean Larson | $ | 13,100 | | $ | 6,594 | (7) | $ | 19,694 |
Kenton Johnson | $ | 11,538 | | $ | 12,147 | (8) | $ | 23,685 |
Bruce LaVigne | $ | 8,275 | | $ | 4,845 | (9) | $ | 13,120 |
Leslie Bergquist | $ | 7,438 | | $ | 196 | | $ | 7,634 |
Martin Seifert | $ | 12,575 | | $ | 7,028 | (10) | $ | 19,603 |
Michael Lund(11) | $ | 5,250 | | $ | 2,184 | | $ | 7,434 |
| | Governor | | | | Fees Earned or Paid in Cash ($) (1) | | | | Additional Compensation ($) (2) | | | | Total Compensation ($) | | | |||||||||
| | Paul Enstad | | | | | $ | 23,500 | | | | | | $ | 18,327 (3) | | | | | | $ | 41,827 | | | |
| | Rodney Wilkison | | | | | $ | 20,425 | | | | | | $ | 18,370(4) | | | | | | $ | 38,795 | | | |
| | Dean Buesing | | | | | $ | 22,375 | | | | | | $ | 13,378(5) | | | | | | $ | 35,753 | | | |
| | Marten Goulet(6) | | | | | $ | 7,425 | | | | | | $ | 14,550(7) | | | | | | $ | 21,975 | | | |
| | Robin Spaude | | | | | $ | 16,450 | | | | | | $ | 13,288(8) | | | | | | $ | 29,738 | | | |
| | Sherry Jean Larson | | | | | $ | 17,688 | | | | | | $ | 894 | | | | | | $ | 18,582 | | | |
| | Kenton Johnson | | | | | $ | 16,788 | | | | | | $ | 12,334(9) | | | | | | $ | 29,602 | | | |
| | Bruce LaVigne | | | | | $ | 8,963 | | | | | | $ | 1,717 | | | | | | $ | 10,680 | | | |
| | Martin Seifert | | | | | $ | 15,100 | | | | | | $ | 12,543(10) | | | | | | $ | 27,643 | | | |
| | David Forkrud | | | | | $ | 10,713 | | | | | | $ | 375 | | | | | | $ | 11,088 | | | |
| | Leslie Bergquist | | | | | $ | 17,913 | | | | | | $ | 9,342(11) | | | | | | $ | 27,255 | | | |
Name | | |
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| Position(s) Held with the Company | | | Length of Service | | ||
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| | | Chief Executive Officer and General Manager | | | Since | |
Stacie Schuler | |
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| | | Chief Financial Officer | | | Since July 2005 | |
Eric Baukol | |
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| | | Risk Manager | | | Since June 2010 | |
Cory Heinrich | |
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| | | Plant Manager | | | Since March 2019 | |
Steve Christensen,Jeffrey Oestmann, Chief Executive Officer and General Manager. Mr. ChristensenOestmann joined the Company in April 2012May 2021 as chief executive officer and general manager. Mr. Oestmann has worked in the agriculture and bio-fuel sectors for approximately 28 years. From 2005 through December 2011,2013 to 2017, Mr. Christensen was chief executive officerOestmann served as President and general managerCEO of Western Wisconsin Energy,East Kansas Agri-Energy, LLC, which owned and operatedoperates an ethanol plant in Boyceville, Wisconsin.Garnett, Kansas. From 2017 to 2019, Oestmann worked for Syngenta, an agricultural science and technology company, as Head of Bio-Fuel Operations. Mr. ChristensenOestmann received an international management and business degree from the University of Nebraska at Omaha. Mr. Oestmann also serves as Chief Executive Officer of HLBE, GFE’s wholly owned subsidiary, a position he has also operated a southwest Iowa family farmheld since 1987. Mr. Christensen holds a Bachelor of Science degree in animal science from Iowa State University and has completed some post graduate work in business.May 26, 2021. Pursuant to the Company’s Natural Gas Local Distribution Company Management Services Agreement with HLBE,Agrinatural, Mr. ChristensenOestmann also serves as Chief Executive Officer of that company, a position he has held since July 31, 2013. Pursuant to the Company’s Natural Gas Local Distribution Company Management Agreement with Agrinatural,May 26, 2021. Mr. Christensen also serves as Chief Executive Officer of that company, a position he has held since February19
3, 2020. Mr. ChristensenOestmann also serves as a member of the Board of Managers of Agrinatural. It is anticipated that Mr. ChristensenOestmann will hold the office of Chief Executive Officer until the earlier of his resignation, death, disqualification or removal by the Board.
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governors. From time to time, the executive board may delegate to the chief executive officer the authority to implement certain decisions of the committee, to set compensation for other executive officers and to fulfill administrative duties.
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Bonus
On June 22, 2017, the board adopted an Annual Chief Executive Officer Cash Bonus Plan (the “New CEO“CEO Bonus Plan”). The Company’s previous chief executive officer and general manager, SteveMr. Christensen, iswas the sole participant in the Plan. The CEO bonus plan replaces in its entirety the prior CEO bonus plan, of which Mr. Christensen was the sole participant.
Bonus Plan.
For our 20202021 fiscal year, the Board did not approveMr. Christensen was awarded a bonus payment forof $57,800 pursuant the CEO Bonus Plan.
During our 2021 fiscal year, the Company paid Oestmann a one-time signing bonus of $22,575. Mr. Oestmann’s employment agreement with the Company requires him to repay the signing bonus in the event he leaves the Company’s employment before completing one year of employment. No other discretionary bonuses were awarded for our fiscal year 2021.
(the “CFO Employment Agreement”).
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Potential Payments upon Termination or Change in Control
If our chief executive officer would have been dismissed without cause on October 31, 2020, and assuming that there was no reduction for salary earned in other employment, the Company estimates that it would have provided salary and health care benefits over a twelve-month period of approximately $288,365 pursuant to our employment agreement with our chief executive officer. Assuming that our chief executive officer would have been dismissed due to a change in control event on October 31, 2020, the Company estimates that it would have paid a lump sum in the amount of approximately $288,365.
If our chief financial officer would have been dismissed without cause on October 31, 2020, and assuming that there was no reduction for salary earned in other employment, the Company estimates that it would have provided salary and health care benefits over a twelve-month period of approximately $249,637 pursuant to our employment agreement with our chief financial officer. Assuming that our chief financial officer would have been dismissed due to a change in control event on October 31, 2020, the Company estimates that it would have paid a lump sum in the amount of approximately $249,637.
Perquisites and Other Personal Benefits
We have traditionally provided named executive officers with perquisites and other personal benefits that the executive board believes are reasonable and consistent with our overall compensation program and are provided to all employees. Except for a Company-owned vehicle provided to Mr. Christensen, our chief executive officer, we do not provide any material executive perquisites. The executive board believes that the use of a Company-owned vehicle, including all costs incurred in the use of the vehicle, are consistent with market practices and necessary for him to effectively serve as the chief executive officer of the Company.
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Summary Compensation Table
| | Name and Principal Position | | | | Year | | | | Salary | | | | Discretionary Bonus(1)(2) | | | | Non-equity Incentive Plan Compensation (3)(4)(5) | | | | All Other Compensation(6)(7)(8) | | | | Total | | |
| | Jeffrey Oestmann, CEO | | | | 2021 | | | | $ 115,552 | | | | $ 22,575 | | | | $ 78,736 | | | | $6,506 | | | | $ 223,368 | | |
| | Steve Christensen, CEO | | | | 2021 | | | | $ 268,594 | | | | $ — | | | | $ 57,800 | | | | $38,531 | | | | $ 364,925 | | |
| | | | | | 2020 | | | | $ 262,602 | | | | $ 30,000 | | | | — | | | | $48,598 | | | | $ 341,200 | | |
| | | | | | 2019 | | | | $ 277,216 | | | | $ — | | | | — | | | | $48,785 | | | | $ 326,001 | | |
| | Stacie Schuler, CFO | | | | 2021 | | | | $ 216,500 | | | | $ — | | | | $ 40,049 | | | | $8,152 | | | | $ 264,701 | | |
| | | | | | 2020 | | | | $ 219,158 | | | | $ — | | | | $19,439 | | | | $9,353 | | | | $ 247,950 | | |
| | | | | | 2019 | | | | $ 174,046 | | | | $ — | | | | $9,400 | | | | $16,333 | | | | $ 199,779 | | |
Name and Principal Position | Year | Salary | Discretionary | Non-equity Incentive Plan Compensation(1)(2) | All Other Compensation(3)(4) | Total | ||||
Steve Christensen, CEO | 2020 | $ | 262,602 | $ | 30,000 | — | $ | 48,598 | $ | 341,200 |
2019 | $ | 277,216 | $ | — | — | $ | 48,785 | $ | 326,001 | |
2018 | $ | 230,676 | $ | — | 8,441 | $ | 46,121 | $ | 285,238 | |
Stacie Schuler, CFO | 2020 | $ | 219,158 | $ | — | $19,439 | $ | 9,353 | $ | 247,950 |
2019 | $ | 174,046 | $ | — | 9,400 | $ | 16,333 | $ | 199,779 | |
2018 | $ | 159,387 | $ | — | 28,998 | $ | 17,630 | $ | 206,015 |
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CEO Pay Ratio
As required
Analysis
– Compensation Elements– Bonus”.For 2020, our last completed fiscal year:
Based on this information, the ratio of the annual total compensation of our CEO to the median of the annual total compensation of all other employees was 4.37 to 1.
To identify the median of the annual total compensation of all our employees, as well as to determine the annual total compensation of our median employee and our CEO, we took the following steps:
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