MEMBER NO. ______
UNIFORM CATTLE DELIVERY AND MARKETING AGREEMENT
U.S. PREMIUM BEEF,
LLC
P.O. BOX 20103
KANSAS CITY, MO 64195
PHONE: 866-877-2525 FAX: 816-713-8810
"EVEN SLOTS"
THIS AGREEMENT , effective as of _______________, 20__ is
between U.S. Premium Beef, LLC (a Delaware limited liability
company, referred to as "USPB"), and the undersigned contracting
producer (referred to as "Producer") who holds Class A Units issued
by USPB. USPB desires to protect its interests by ensuring
that it will have access to an adequate supply of cattle for
delivery to cattle processing facilities owned, controlled, or
contracted by USPB on behalf of USPB and other Class A Unitholders
who deliver cattle to or through USPB; and the Producer desires to
supply cattle to or through USPB for processing. USPB and the
Producer agree that the Producer must own, control, or associate
with others to make beneficial changes in cattle breeding and
production to meet processing and beef consumer preference
demands. Subject to the terms, conditions, and obligations of
USPB and Producer in this Agreement, similar obligations of other
Class A Unitholders contracting with USPB, and in accordance with
the Limited Liability Company Agreement of USPB, the Producer and
USPB agree as follows:
1.
Commitment to Supply Cattle to USPB. The Producer
agrees to deliver and supply to USPB and USPB agrees to buy and
receive one head of cattle from the Producer for each Class A unit
owned by the Producer (subject to assignment as provided below and
as provided in Paragraph 13) each year during the term of this
Agreement, except that the Board of Directors may reduce the annual
cattle delivery amount by giving advance written notice if the
Board determines in its sole discretion that the available
processing capacity held, controlled, or contracted by USPB for its
Class A Members will be a lesser amount. The Board of
Directors may, by resolution, allow a small deviation from the
above annual delivery requirements to allow for Producer's
production variances. The Board of Directors may approve the
assignment of delivery rights under this Agreement to another Class
A Member or associate of USPB; provided, however, that the Producer
remains liable for any underdeliveries or
non-deliveries.
2. Delivery of
Cattle. The cattle committed to USPB under Paragraph 1
must be delivered to USPB on an equal four week basis as determined
by USPB. A uniform delivery schedule shall be prepared by
USPB and given to the Producer on a regular basis. The
Producer agrees to supply the cattle in accordance with the
delivery schedule and agrees the risk of loss for the cattle shall
remain with the Producer until the cattle are delivered to USPB at
a location designated by USPB.
3. Appointment of
USPB as Purchasing Agent. The Producer appoints and designates
USPB to act as his, her or its sole agent in the sale and marketing
or utilization of cattle committed to USPB under this Agreement and
any extensions, renewals or amendments of this
Agreement.
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| U.S. PREMIUM BEEF, LLC |
EVEN SLOTS DELIVERY AGREEMENT
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If a Producer is unable to supply the required amount of cattle,
the Producer must obtain the cattle from any other source and
deliver the cattle to USPB, just as if the cattle had been produced
by the Producer. If the Producer does not deliver the cattle
as stated, the Producer agrees that USPB, at USPB's option without
the obligation, may act as Producer's agent for the purpose of
obtaining cattle in the name of the Producer and may charge to the
Producer all expenses, including, but not limited to, the price of
the cattle, shipping, reasonable attorneys' fees, and all
incidental costs.
USPB shall have no obligation to accept any cattle for marketing or
processing in an amount greater than one head of cattle for each
Class A Unit held by Producer, regardless of whether the Producer's
total cattle production has increased.
4. Minimum Quality
Standards. All
cattle delivered by Producer under this Agreement shall meet the
minimum quality standards of the industry for cattle to be
processed. Cattle of substandard quality, as determined by
USPB or the entity processing the cattle, shall be either: (1)
rejected and returned to the Producer with all costs relating to
the rejection and return charged to the Producer; or (2) accepted
and handled or disposed of in a manner customary in the industry
with any necessary costs charged to the Producer. If the
Producer intentionally delivers cattle that fail to meet minimum
quality standards (due to disease or otherwise), repeatedly
delivers cattle that fail to meet minimum quality standards (due to
disease or otherwise), or intentionally delivers cattle from a
source, feedyard, or supply that jeopardizes the quality of the
meat from the cattle as determined by USPB, it is a breach of this
Agreement and USPB may terminate this Agreement and the Producer's
membership in USPB.
5.
Pooling Arrangement. USPB may pool the Producer's cattle for
sale to various markets or for processing.
6. Payment to
Producer. USPB
shall market, process and utilize the cattle and products from the
cattle in a manner it deems to be in the best interest of USPB and
all of the Class A Members marketing and delivering cattle to or
through USPB. USPB agrees to pay the Producer according to a
Pricing Schedule determined by the Board of Directors. That
Pricing Schedule will reflect cattle payments for delivery and
transfer of cattle to or through USPB for processing that include a
market based purchase price plus consumer, market