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in both the selling and marketing of the corn committed to MCP.
In addition, MCP had “sole and complete discretion in all phases
of the marketing activity”. The 1994 and 1995 UMAs did not
obligate Fultz Farms; only Mr. Fultz and MCP were parties to the
agreements.
The UMAs specified that MCP was obligated to pay Mr. Fultz
for delivered corn as follows: (1) An initial payment of 80
percent of the loan value per bushel of corn delivered within 5
days of MCP’s acceptance of the corn; (2) storage and interest
payments for corn delivered after October 1 of each processing
year; (3) an additional payment (“value-added payment”) for the
value added to the corn during its processing by MCP, which was
to be based on a yearend determination of MCP’s “net proceeds
from all of its operations” which would further compensate Mr.
Fultz for his corn and still allow MCP to retain its financial
integrity; and (4) patronage dividends.
Under the UMAs, Mr. Fultz was required to produce and
deliver corn to MCP for processing three times a year (October
through January; February through May; and June through
September), giving approximately a third of the total required
annual quantity at each delivery time. Mr. Fultz was free to
satisfy his delivery obligations through several means. He could
meet these obligations to MCP with corn that was grown on his own
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Last modified: May 25, 2011