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complete discretion in all phases of the marketing activity”.
The UMAs did not obligate Fultz Farms; only petitioners and MCP
were parties to the agreements.
The UMAs specified that MCP was obligated to pay petitioners
as follows: (1) An initial payment of 80 percent of the 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 petitioners for their corn and
still allow MCP to retain its financial integrity; and (4)
patronage dividends.
Under the UMAs, petitioners were 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. Petitioners were free to
satisfy their delivery obligations through several means. They
could meet these obligations to MCP with corn that was grown on
the farm or acquired on the open market, by hiring an outside
grower, or from pool corn.
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Last modified: May 25, 2011