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## Member No.  ______

 

 

**UNIFORM CATTLE DELIVERY AND MARKETING AGREEMENT**

 

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### U.S. PREMIUM BEEF, LLC

P.O. BOX 20103

KANSAS CITY, MO  64195

PHONE: (866) 877-2525 FAX:(816) 713-8810

 

### "ODD SLOTS"

 

            **THISAGREEMENT**, effective as of _______________, 20___, is between U.S. PremiumBeef, 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 toprotect its interests by ensuring that it will have access to an adequatesupply of cattle for delivery to cattle processing facilities owned, controlledor contracted by USPB on behalf of USPB and other Class A Unitholders whodeliver cattle to or through USPB; and the Producer desires to supply cattle toor through USPB for further processing.  USPB and the Producer agree that theProducer must own, control, or associate with others to make beneficial changesin cattle breeding and production to meet processing and beef consumerpreference demands.  Subject to the terms, conditions, and obligations of USPBand Producer in this Agreement, similar obligations of other Class AUnitholders contracting with USPB, and in accordance with the Limited LiabilityCompany Agreement of USPB, the Producer and USPB agree as follows:

 

            **1.**         **Commitmentto Supply Cattle to USPB.**  Producer agrees to deliver and supply to orthrough USPB and USPB agrees to market or receive for processing one head ofcattle from the Producer for each Class A Unit owned by the Producer (subjectto assignment as provided below and as provided in Paragraph 13) each yearduring the term of this Agreement, except that the Board of Directors mayreduce the annual cattle delivery amount by giving advance written notice, ifthe Board determines in its sole discretion that the available processingcapacity held, controlled, or contracted by USPB for its Class A Members willbe a lesser amount.  The Board of Directors may, by resolution, allow a smalldeviation from the above annual delivery requirements to allow for Producer'sproduction variances.  The Board of Directors may approve the assignment ofdelivery rights under this Agreement to another Class A Member, or an associateof USPB; provided, however, that the Producer remains liable for any underdeliveriesor non-deliveries.  USPB shall attempt to limit odd slot delivery agreements toallow all cattle committed to delivery to be delivered.  However, if there aremore cattle committed than available slots for processing, USPB will accept deliverycommitments on a first-come, first-served basis for the available slots orutilize a selection method for delivery commitments described in Paragraph 2.  

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| **U.S. Premium Beef, LLC** | **Odd Slots Delivery Agreement**                                                                                                                                
 

 

 

**2.         Delivery of Cattle. **USPB will attempt to accommodate the Producer'spreference for delivery as indicated in Paragraph 1.  However, for deliveryslots that are overfilled, USPB intends to use a selection procedure that mayinclude closing certain delivery slots or incentives to fill underfilleddelivery.  If the Producer selects an overfilled slot, the Producer may selectan underfilled slot or participate in a selection procedure with otherProducers to determine how the odd slots will be filled.  A uniform deliveryschedule shall be prepared by USPB and given to the Producer with the actualdelivery period(s).  The Producer agrees to supply the cattle in accordancewith the delivery schedule and agrees the risk of loss for the cattle shallremain with the Producer until the cattle are delivered to USPB at a locationdesignated by USPB.

 

**            3.         Appointmentof USPB as Purchasing Agent.**  TheProducer appoints and designates USPB to act as his, her or its sole agent inthe sale and marketing or utilization of cattle committed to USPB under thisAgreement and any extensions, renewals or amendments of this Agreement.

 

            Ifa Producer is unable to supply the required amount of cattle, the Producer mustobtain the cattle from any other source and deliver the cattle to USPB, just asif the cattle had been produced by the Producer.  If the Producer does notdeliver the cattle as stated, the Producer agrees that USPB, at USPB's optionwithout the obligation, may act as Producer's agent for the purpose ofobtaining cattle in the name of the Producer and may charge to the Producer allexpenses, including, but not limited to, the price of the cattle, shipping,reasonable attorneys' fees, and all incidental costs.

 

            USPBshall have no obligation to accept any cattle for marketing or processing in anamount 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.         MinimumQuality Standards.**  All cattle delivered by Producer under this Agreementshall meet the minimum quality standards of the industry for cattle to beprocessed.  Cattle of substandard quality, as determined by USPB or the entityprocessing the cattle, shall be either: (1) rejected and returned to theProducer with all costs relating to the rejection and return charged to theProducer; or (2) accepted and handled or disposed of in a manner customary inthe industry with any necessary costs charged to the Producer.  If the Producerintentionally delivers cattle that fail to meet minimum quality standards (dueto disease or otherwise), repeatedly delivers cattle that fail to meet minimumquality standards (due to disease or otherwise), or intentionally deliverscattle from a source, feedyard, or supply that jeopardizes the quality of themeat from the cattle as determined by USPB, it is a breach of this Agreementand USPB may terminate this Agreement and the Producer's membership in USPB.

 

            **5.         PoolingArrangement.**  USPB may pool the Producer's cattle for sale to variousmarkets or for processing.

 

            **6.         Paymentto Producer.**  USPB shall market, process and utilize the cattle andproducts from the cattle in a manner it deems to be in the best interest ofUSPB and all of the Class A Members marketing and delivering cattle to orthrough USPB.  USPB agrees to pay the Producer according to a Pricing Scheduledetermined by the Board of Directors.  That Pricing Schedule will reflectcattle**payments for delivery and transfer of cattle to or through USPBfor processing that include a market based purchase price plus consumer, marketand processor based quality incentives as determined by the Board.  To theextent possible and as determined by the Board of Directors, USPB will basepayments on a quality grid policy guide for cattle delivered to or throughUSPB.  

 

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**U.S. PREMIUM BEEF, LLC**
**ODD SLOTS DELIVERY AGREEMENT**
 

 

                        

            **7.         Term.** The term of this Agreement continues as long asthe Producer holds Class A Units of USPB, provided, however, for purposes ofdetermining cattle commitments, contractual delivery requirements, or toterminate this Agreement independent of the Class A Units, the term shall beconstrued to be a five (5) year "evergreen" that automatically renews annuallyin the beginning of USPB's fiscal year for a subsequent five year period. Notwithstanding the other provisions of this Paragraph 7, if USPB transfers allor substantially all of its assets to another entity, merges or consolidateswith another entity, or dissolves and the action is approved by the unitholdersas provided in the Limited Liability Company Agreement, then USPB may terminatethis Agreement upon sixty (60) days prior written notice or coterminous with thetransfer of assets, merger, consolidation, or dissolution.

 

            **8.         LiquidatedDamages and Injunctive Relief.**  The Producer acknowledges that monetarydamages may not be a sufficient remedy for the Producer's failure to delivercattle in accordance with the terms and conditions of this Agreement or forother breach of this Agreement, and that USPB shall be entitled, in addition toall other rights or remedies in law and equity, to seek injunctive relief, adecree of specific performance or other equitable relief, without the necessityof posting a bond in connection with that right or remedy.  It is furtheragreed that in the event of any breach of this Agreement, because of theimpossibility of ascertaining with accuracy the damages resulting from such abreach, USPB shall be entitled, as liquidated damages, to an amount equal totwenty-five percent (25%) of the market value of the cattle which the Producerhas failed to deliver or improperly furnished under the terms of thisAgreement, provided however the Board at its discretion may by resolutionexempt from breach and liquidated damages a certain amount or percentage of thecattle required to be delivered based on accepted production losses or reducethe amount based on market or economic factors on a case by case basis.  Thegreater amount of liquidated damages in the previous sentence applies if theBoard of Directors determines the breach is willful, the reason of the breachwas to take advantage of higher markets elsewhere, or the Producer isabandoning the Producer's contractual duties to USPB and other members orunitholders of USPB.  Should the non‐performance by the Producer of his,her, or its obligations under this Agreement result in the termination of his,her, or its membership in USPB, the Producer agrees that, in addition to anyother remedies available to USPB, the amount of damages as he or she may becomeobligated to pay USPB may be offset by USPB in USPB's discretion against theProducer's units in USPB or other evidences of equity.  The Producer agrees topay all reasonable legal costs and expenses, including attorneys' fees andcourt costs, incurred by USPB in any action brought by USPB against theProducer for any breach or threatened breach of this Agreement.

 

**            9.         Compliancewith USPB's Governing Instruments.** The Producer accepts and agrees to conform to and abide by the provisions ofthe Limited Liability Company Agreement during the term of this Agreement.  

 

**            10.       SecurityInterests.**  If the Producer grants asecurity interest in any of his, her, or its cattle marketed to or through USPBunder and during this Agreement, USPB shall have the right, but not theobligation, after acceptance of the cattle by USPB, to pay off all or part ofthe obligation underlying the security interest.  The payment shall be for theaccount of the Producer and shall be charged against the amount owing to theProducer by USPB.

 

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**U.S. PREMIUM BEEF, LLC**
**ODD SLOTS DELIVERY AGREEMENT**
 

 

            TheProducer shall inform USPB of all security interests he or she has granted bydisclosing all security interests as provided by state or federal law, and ifnot provided, then Producers shall provide disclosure separately in writing. The Producer shall notify USPB prior to granting any security interest.

 

            **11.       Inabilityof USPB to Perform.**  In case of fire, explosions, interruption of power,strikes or other labor disturbances, lack of transportation facilities,shortage of labor supplies, floods, action of the elements, disease orquarantine, riot, interference of civil or military authorities, enactment oflegislation or any unavoidable casualty or cause beyond the control of USPB orprocessors engaged or contracted by USPB that prevents or unreasonablyrestricts the receiving, handling, processing, marketing of cattle, or otheroperations, USPB shall be excused for performance during the period that USPB'sbusiness or operations are so affected.  USPB in its judgment may, during suchperiod, operate on a limited basis and accept for processing the portion ofcattle that can economically be handled and that USPB has informed Producer.

 

            USPBshall give written notice to the Producer of the inability to perform and thespecific cause or causes for the non‐performance.  The Producer shall bepaid, pursuant to this Agreement, for all cattle accepted for processing.  

 

            **12.       CompleteAgreement.**  USPB and Producer agree that there are no oral or otherconditions, promises, representations or inducements in addition to or invariance with any of the terms of this Agreement, and that this Agreement fullyand completely represents the voluntary and clear understanding of bothparties.

 

             **13.      Assignmentby Producer.**  The Producer may only assign or transfer his, her, or itsdelivery rights under this Agreement, to a Class A Member or an associate ofUSPB upon notification and acceptance by USPB.  No assignment or transfer mayoccur without the prior written consent of USPB, and then only to a producerwho is a Class A Member or associate.  

 

             **14.      Waiverof Breach.**  No waiver of a breach of any of the provisions contained inthis Agreement shall be construed to be a waiver of any subsequent breach ofthe same or of any other provision of this Agreement.

 

             **15.      Constructionof Terms of Agreement.**  The language and all parts of this Agreement shallbe construed as a whole and not strictly for or against any party.  In theevent any term, covenant or condition of this Agreement is held to be invalidor void by a court, the invalidity of any such term, covenant or conditionshall in no way affect any other term, covenant or condition of thisAgreement.  This Agreement shall be interpreted under Kansas law, withoutreference to the Kansas law regarding conflict of laws.

 

             **16.      Successorsand Assigns.**  Subject to the other provisions of this Agreement, all of theterms, covenants and conditions of this Agreement shall inure to the benefit ofand shall bind the parties and their successors and permitted assigns.

 

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**U.S. PREMIUM BEEF, LLC**
**ODD SLOTS DELIVERY AGREEMENT**
 

 

 

 

**            17.       Terminationof Any Prior Marketing Agreement.** USPBand the Producer agree that this Agreement terminates, supersedes, and replacesany prior Marketing Agreements between USPB and the Producer on the effectivedate of this Agreement.

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            **18.**       **Modification.** This Agreement may be amended or modified upon a majority vote of the Class AMembers who are a party to a Uniform Delivery and Marketing Agreement (both"Odd Slots" and "Even Slots").  The amendment must be considered at a duly heldmeeting of the Class A Members of USPB for which the notice states one of itspurposes is consideration of amendments to the Uniform Cattle Delivery andMarketing Agreement by Class A Members.  

 

 
ProducerU.S. Premium Beef, LLC        By   By    
Mark  Gardiner
   
Its  Chair

 

 

 

 

Address

**Attest:**

 

 

 

 

 

 

 

 

 

 

By

 
  
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Jerry  Bohn
         Its Secretary
 

 

 

 

  Date:

 

Date:

 

 

 

 

 

 

 

 

 

 

 

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