Cattle Fortune, LLC

Program Guidelines

DEFINITIONS

For the purposes hereof and all other subsequent documents related to this Contract, the following terms will be defined as follows:

“Customer” or “Customers” refer to any customer who are enrolled in the Cattle Fortune program via registering and approved to purchase cattle on the Cattle Fortune website.

“The Company” will be the cattle brokerage Company, Cattle Fortune, a Colorado Limited Liability Company and website www.cattlefortune.com.

“Feedyard” will refer to the Custom Cattle Feeding facility enrolled in The Company’s program.

“The Program” pertains to the Program Guidelines related to this contract as supplemented and agreed to between The Program Lender(s), The Company, and the Feedyard.

“Forward Contract” A contracted price per hundred weight to be paid for a specific set of cattle for a determined market ready delivery period via:

1. Cash/Live: Method of sale in which the cattle are sold to the packer `live' at the feedlot. The packer is responsible for transporting the animals to the slaughter facility. A pencil Shrink may be applied: (An arithmetic deduction of weight from the live weight of an animal to account for fill, usually 4% for cattle off-feed weights of fed cattle).
2. In the Meat/Beef: Method of sale which refers to selling the cattle on a carcass weight basis rather than live weight. Usually carcass weight times carcass price with no discounts for Choice or Select.
3. Grid: A method of pricing slaughter cattle which offers premiums and discounts for cattle. Cattle which are leaner and have a higher quality grade receive the premiums. Grids generally have other specifications for carcass weight and discounts.

“End Market/Packer”  Meat processor (Tyson, Smithfield, Coleman, etc.) where the cattle will be sold to once the cattle are market ready.

“Chicago Mercantile Exchange (CME)” a United States financial exchange based in Chicago Ill. The exchange focuses mainly on commodities (Cattle, Pork Bellies, Corn, Oil) and currencies.

“Risk Mangagement”: Includes CME price protection contracts such as:

1. Puts: An option to sell a commodity, security or futures contract at a specified price at any time between now and the expiration of the option contract
2. Calls: An option to buy a commodity, security or futures contract at a specified price any time between now and the expiration date of the option contract.
3. Hedge: The purchase or sale of a futures contract as a temporary substitute for a cash market transaction to be made at a later date. Usually involves simultaneous, opposite positions in the cash market and futures market.

“Electronic Reporting” Web bases paperless reporting of custom feed/care billing statements, cattle performance, and email alerts of available cattle for sale through the Cattle Fortune Shopping Cart as well as alerts of risk management requirements.

“Shelf Cattle” A listing of cattle for re-sale detailing gender, genetics, weight, price and other specifications. Cattle are purchased and paid for via an Automated Clearing House (ACH) point of sale transaction.

“Lender(s)” are generally referred to as The Company’s cooperating Bank/Financial institute of which finances The Customer(s) cattle, feed, care, and risk management custom fed in The Program enrolled Feedyards.

“Open Pen Space” Available Pen space available in the future which may be filled by The Customer through The Company website. 

Program Guidelines

In Order for each Customer and/or Feedyard to participate in the Cattle Fortune marketing program each agrees to the following protocol:

1. Make sure that the cattle brokers who market and deliver cattle to the Feedyard comply with all Packer and Stockyard Regulations: http://archive.gipsa.usda.gov/pubs/memo3.pdf.

A)    Feedyard shall be responsible to enforce price adjustments or other remedies do to misrepresentation of cattle. Cattle Fortune is not responsible and is held harmless for third party cattle brokerage misrepresentation of cattle.

B)     Cattle weigh-ups: Custom Feeder must have or access to certified scales to weigh cattle as the cattle enter the Feedyard premises. All scale tickets, brand inspections, health certificates and cattle descriptions must be kept, recorded, and copies delivered to a Representative of Cattle Fortune.

C)     The Invoiced records will also accompany the information that a licensed and bonded third-party Cattle Broker has provided upon purchase of cattle, including weigh-up conditions, price of cattle, breed, color, gender, age, location of cattle delivered from, ranch premise identification, and vaccinations (if available).  Feedyard will have final authority on valuation of cattle sold on the Shelf. If cattle are purchased and made available for the shelf without a licensed and bonded order buyer then the cattle must be inspected by a representative of Cattle Fortune before listed on the Shelf.

D)    The Feedyard must remember, even as a seller, that they are not a broker they are a Custom Cattle Feeder. The price that the Feedyard paid for the cattle will be promoted and sold to the Customer as is regardless of the market price at the time of sale. In other words, the price established to The Company will be the selling price to the Customer with NO mark ups on the cattle sold through the Program. In case the cattle cannot be sold, it is hereby advised by The Company to protect the cattle owned through and adequate price protection protocol.

2. Funds must be available in the Customer’s checking or savings account of which they are paying for the cattle, on the day of the transaction. All transactions are processed by 3:00 p.m. Mountain Standard Time (MST) of that business day.  Anytime after 3:00 p.m. MST will be processed the following business day.

3. Once cattle are purchased through the Online Shopping Cart, the funds, (minus any commissions) will then be transferred, wired or sent via ACH to the customers Lender. The final check for cattle and feed will be wired to the account of the Custom Feeding Facility from the participating lender within 48 business hours of sale of cattle. Cattle purchased in full through the shopping cart will be wired or sent via ACH directly to the Feedyard banking account provided (minus commissions).

4. All cattle available for resale (shelf cattle) must be made available to market through the Cattle Fortune shopping cart as well as all available and upcoming availability of Open Pen Space. If the Feedyard customer purchases the cattle listed for resale the Feedyard must report the cattle as sold and it will be reflected as (Feedyard/Company owned).

5. Cattle Fortune is not responsible for payments of custom feeding services. Cattle Fortune reports the Custom Feeding Services bill to the customer and cooperating Lender which is sent each billing cycle will be sent via ACH or wired to the account information provided by the Feedyard from the Cooperating Lender. Otherwise, if the Customer is not financed through a cooperating lender that customer is responsible to pay for custom feeding services sent via ACH, wire, or mail in a check. The Feedyard may charge no more than one percent (1%) interest on the account for unpaid feed and services that are more than thirty (30) days late.

6. If the Customer’s funds (for cattle payment, not the custom feeding services) are rejected due to Non-Sufficient Funds or incorrect information, Cattle Fortune will assess the customer a $250.00 service fee. Once the Customer has placed an order through the Program, the Customer is liable for payments, service fees and applicable interest accrued. Legal action will be taken for breach of contract in such events. Cattle Fortune will not take possession of cattle.

7. All banking account and identity information provided by the Customer will be verified before authorized to purchase cattle through the program. (See ACH Authorization)

8. The Customer has the convenience of contacting Cattle Fortune for any questions they may have regarding cattle for sale, open pen space availability or about any billing statements they have concerning cattle already owned and on feed through this program. The Customer must contact Cattle Fortune for any questions or issues not the Feedyard. Cattle Fortune is a Cattle Brokerage and provides Customer Service to each Enrolled Customer. If there are issues that need to be discussed Cattle Fortune will be the intermediary to help resolve these issues. We will also arrange transportation for Feedyard visitation once the Customer has arranged to travel to the cattle feeding area. Cattle Fortune will pick the Customer up from the Airport or other meeting point and take them on tour to the cooperating Feedyards.

9. All banking account information provided by the Feedyard and Customer will be verified before cattle will be sold through this program. Additionally, the Feedyard must provide three (3) years of financials to establish trust of the stability of the custom feeding operation prior to enrollment.

10. Cattle Fortune reserves the right to contact customer’s Lender if not using our cooperating lender before approval to purchase cattle in full. 

11. There are three (3) approaches a customer may purchase cattle to be fed in enrolled feedyard through the Cattle Fortune program:

A)    Cattle For Sale: These cattle are reported through the shopping cart as cattle available on the shelf or available for sale and undelivered as of yet to the Feedyard. Each animal is specifically identified with a visual tag in sequential numbers (example lot 420 individual 1 through 160).

B)     Pen Space Reservation: A customer may reserve pen space that is available to feed cattle that they already own such as ranch retained ownership.

C)     Placing an Order: Cattle Fortune will provide a list of cattle prices including Freight and Commissions for cattle in various regions to be delivered to the Customer’s choice of Feedyards of whom have open pen space availability.

12. The Custom Feeding Facility is responsible to tag cattle with visual tags readable from the feed bunk, with consecutive identification numbers The Company assigns to be reported through the Shopping Cart/Cattle Inventory Tracking Service.

13. RFID or EID tags are not required through this program to use within the Custom Feeding management protocol at this time.

14. When the time comes each Custom Cattle Feeding facility will need to apply for a U.S.D.A. Premise Identification Number with the State(s) where the business of cattle feeding is conducted and must comply to all the regulations forthcoming concerning National Animal Identification as the laws become established.

15. Custom Feeder must have a sufficient software program (Turn-Key, High Plains, etc) to report feed, yardage, cattle performance and all other charges assessed to the Customer. This will be emailed to Cattle Fortune via a Word Document.

16. Risk Management fees must also be reported similarly to the Word Document provided by the Commodity Broker. This documentation must be reported through the Company’s secure website Electronic Reporting Service. This information is to be updated regularly.

17. The Customer is responsible to obtain a Commodity Broker or must sign a power of attorney authorizing The Company to retain one on their behalf on all financed cattle through this program.

18. The Company will Market Fat cattle in a manner the Customer chooses. The Company will have Forward Contracts, In the Meat, or Live Cattle options for each Customer to choose from. If the Company and/or Customer feel that the cattle should be marketed then the cattle MUST be marketed.

19. When the Customer requests for Feed Booking, the Feedyard is responsible to place the order as requested (partial or complete feeding cycle) by the Customer promptly.

20. In addition to the billing statement reports, all realized or dead cattle must come with a post via a certified veterinarian or feedyard personnel for reason of death. This will be reported on the billing statement and at the Company’s request a copy of the Veterinarian’s post report shall be supplied to the Company as to notify the Customer of the issue for realization or death.
21. All Consulting or Private Veterinarians and Nutritionists names and contact information must be on file with the Company for reference.

22. All enrolled cattle feeding customers will have their feed bills and performance records reported online and will not be sent paper based media unless expressed otherwise in writing. The Feedyard is responsible to email the file of the billing, performance, and risk management account to webmaster@cattlefortune.com on regular billing cycles the 1^th and the 15^th of every month unless otherwise agreed to another schedule before commencing business with Cattle Fortune, LLC. If Feedyard fails to promptly send agreed upon said documents the Customer is not responsible to pay for late payment interest fees.

23. Pictures of the cattle on feed will from time to time be taken by a representative of The Company. A representative of Cattle Fortune will also inspect the cattle and account for  all pens of cattle at once a month during the feeding period.

24. All parties enrolled agree to the Online Record Disclosure Statement.

25. Termination of this agreement is determined on the cattle currently on feed. If there are no cattle on feed purchased through this program, the guidelines do not apply. Once all cattle are off feed and marketed and the customer chooses not to purchase more cattle through the Cattle Fortune program then this agreement ceases to exist unless the customer purchases more cattle within a twelve (12) month time period.