On July 29, 2011, Heron Lake BioEnergy, LLC entered into a termination agreement with C & N Ethanol Marketing Corp. (C&N) to terminate the Ethanol Purchase and Marketing Agreement between the two companies, with an effective termination date of August 31, 2011. Under the Marketing Agreement, C&N purchased, marketed and re-sold all of the ethanol produced at the company's ethanol production facility since September 30, 2009. The original term of the Marketing Agreement was scheduled for three years, with automatic renewal for subsequent one-year terms unless either party terminated the Marketing Agreement 60 days before the end of the term. Under the Marketing Agreement, C&N paid the Company the gross sales price to the customer less expenses and a 1% marketing fee after expenses. The Marketing Agreement also contained provisions addressing other matters, including payment, forecasting, quality of product, transfer of title and auditing of records.