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such stock could be held only by producers of agricultural
products “who reside in the territory served”. “Producers”
referred to persons “actually engaged in the production of one or
more of the agricultural products handled” by MCP. Producers of
agricultural products eligible for membership and having acquired
a minimum of 5 shares of common stock of MCP were recognized as
members.
a. Units of Equity Participation
Mr. and Mrs. Fultz collectively purchased 30,000 shares of
stock in MCP in approximately August 1982 when MCP was first
organized. Both petitioners held enough shares of MCP stock to
qualify as members of MCP. As members, they were able to
purchase additional “units of equity participation” (units) in
MCP. Petitioners collectively purchased an additional 5,000
units in December 1992. From October 1983 to December 1995, Mr.
Fultz individually purchased a total of 40,000 units. Mrs. Fultz
individually purchased 65,000 units in October 1983. Each unit
represented one potential bushel of corn that the member might
agree to supply to MCP.
In order to supply corn to MCP, a producer was required to
hold at least 5,000 units. Corn producers who wished to supply
corn to MCP were also required annually to execute a uniform
marketing agreement (UMA). The producer was obligated to deliver
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Last modified: May 25, 2011