**MEMBERNO.  ______**

 

 

# UNIFORM CATTLE DELIVERY ANDMARKETING 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

 

**"EVEN 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 to protect its interestsby ensuring that it will have access to an adequate supply of cattle fordelivery to cattle processing facilities owned, controlled, or contracted byUSPB on behalf of USPB and other Class A Unitholders who deliver cattle to orthrough USPB; and the Producer desires to supply cattle to or through USPB forprocessing.  USPB and the Producer agree that the Producer must own, control,or associate with others to make beneficial changes in cattle breeding andproduction to meet processing and beef consumer preference demands.  Subject tothe terms, conditions, and obligations of USPB and Producer in this Agreement,similar obligations of other Class A Unitholders contracting with USPB, and inaccordance with the Limited Liability Company Agreement of USPB, the Producerand USPB agree as follows:

 

            **1.**         **Commitmentto Supply Cattle to USPB.**  The Producer agrees to deliver and supply toUSPB and USPB agrees to buy and receive one head of cattle from the Producerfor each Class A unit owned by the Producer (subject to assignment as providedbelow and as provided in Paragraph 13) each year during the term of thisAgreement, except that the Board of Directors may reduce the annual cattledelivery amount by giving advance written notice if the Board determines in itssole discretion that the available processing capacity held, controlled, orcontracted by USPB for its Class A Members will be a lesser amount.  The Boardof Directors may, by resolution, allow a small deviation from the above annualdelivery requirements to allow for Producer's production variances.  The Boardof Directors may approve the assignment of delivery rights under this Agreementto another Class A Member or associate of USPB; provided, however, that theProducer remains liable for any underdeliveries or non-deliveries.  

 

            **2.         Deliveryof Cattle.**  The cattle committed to USPB under Paragraph 1 must bedelivered to USPB on an equal four week basis as determined by USPB.  A uniformdelivery schedule shall be prepared by USPB and given to the Producer on aregular basis.  The Producer agrees to supply the cattle in accordance with thedelivery schedule and agrees the risk of loss for the cattle shall remain withthe Producer until the cattle are delivered to USPB at a location designated byUSPB.

 

**            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.

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| **U.S. PREMIUM BEEF, LLC** | **EVEN SLOTS DELIVERY 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 cattledelivered by Producer under this Agreement shall meet the minimum qualitystandards 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 rejectionand return charged to the Producer; or (2) accepted and handled or disposed ofin a manner customary in the industry with any necessary costs charged to theProducer.  If the Producer intentionally delivers cattle that fail to meetminimum quality standards (due to disease or otherwise), repeatedly deliverscattle that fail to meet minimum quality standards (due to disease orotherwise), or intentionally delivers cattle from a source, feedyard, or supplythat 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 theProducer's membership in USPB.  

 

**5.         Pooling Arrangement.**  USPB may pool the Producer's cattle for sale tovarious markets or for processing.

 

**            6.         Paymentto Producer.**  USPB shall market,process and utilize the cattle and products from the cattle in a manner itdeems to be in the best interest of USPB and all of the Class A Membersmarketing and delivering cattle to or through USPB.  USPB agrees to pay theProducer according to a Pricing Schedule determined by the Board of Directors. That Pricing Schedule will reflect cattle**payments for delivery andtransfer of cattle to or through USPB for processing that include a marketbased purchase price plus consumer, market and processor based qualityincentives as determined by the Board.  To the extent possible and asdetermined by the Board of Directors, USPB will base payments on a quality gridpolicy guide for cattle delivered to or through USPB.  

                                                                                                                                                                        

            **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 withthe transfer of assets, merger, consolidation, or dissolution.

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            **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.

 

            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 if notprovided, then Producers shall provide disclosure separately in writing.  TheProducer 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.

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            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 the eventany term, covenant or condition of this Agreement is held to be invalid or voidby a court, the invalidity of any such term, covenant or condition shall in noway affect any other term, covenant or condition of this Agreement.  ThisAgreement shall be interpreted under Kansas law, without reference to theKansas 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.

 

**            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 ofUSPB for which the notice states one of its purposes is consideration ofamendments to the Uniform Cattle Delivery and Marketing Agreement by Class AMembers.  

 

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

 

 

 

 

Address

**Attest:**

 

 

 

 

 

 

 

 

 

 

By

 
** **** **
** **

Jerry  Bohn
         Its Secretary
 

 

 

 

  Date:

 

Date:

 

 

 

 

 

 

 

 

 

 

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