Beef is raised in three phases before it is processed: calves are raised on pasture and range land, as feeder cattle they feed on pasture, crop residue, and range land, and finally they go to feedlots, where they are fattened for slaughter. Feeder contracts are a type of futures contract based on young cattle that are sent to feedlots in preparation for slaughter. The Chicago Mercantile Exchange first introduced a feeder cattle contract in 1971.
It is important make sure the agreement is clear as to whether a bailment or an actual sale of the animals is intended. In order to constitute a bailment and not a sale, a fattening or raising agreement should provide that the owner agrees to provide the animals involved to the feeder with the owner retaining title to the animals, and the feeder or raiser is to feed or raise them for sale as the owner deems proper. This form is a sample of a sale rather than a bailment.
The Virginia Purchase and Maintenance Agreement for Cattle-Feeder Contract is a legally binding document that outlines the terms and conditions agreed upon by the buyer and seller for the purchase and maintenance of cattle. This agreement serves as a comprehensive contract, ensuring the smooth transaction and ongoing care of cattle. The Virginia Purchase and Maintenance Agreement for Cattle-Feeder Contract typically includes key components such as: 1. Parties: Clearly states the names and contact information of the buyer and seller involved in the transaction. 2. Purchase Details: Provides a detailed description of the cattle being purchased, including breed, age, weight, and quantity. It also specifies the agreed-upon purchase price for the cattle. 3. Payment Terms: Outlines the method and schedule of payment between the buyer and seller, including any down payments or installment arrangements. 4. Delivery and Inspection: Specifies the location and method of cattle delivery and allows for a designated period for the buyer to inspect and accept the purchased cattle. Any discrepancies or claims must be noted during this inspection period. 5. Maintenance Responsibilities: Defines the responsibilities of both the buyer and seller regarding the ongoing care and maintenance of the cattle. This may include feeding requirements, veterinary care, and facility maintenance. 6. Breeding and Reproduction: Stipulates any specific agreements or limitations regarding breeding or reproduction rights of the cattle. 7. Insurance and Liability: Addresses the allocation of risk and liability, including any insurance requirements or provisions in case of accidents, injuries, or loss of cattle during the agreed-upon period. 8. Default and Termination: Outlines the conditions under which either party can terminate the contract, including non-payment, non-compliance with terms, or breach of agreement. It's worth mentioning that while the Virginia Purchase and Maintenance Agreement for Cattle-Feeder Contract template provides a basic framework, there may be variations or additional types of contracts depending on specific needs and circumstances. For instance, there could be variations that consider custom feeding agreements, lease-to-own options, or arrangements for agreement (grazing on another person's land). It's essential for all parties involved to clearly define the terms and consult legal professionals to draft or modify the contract accordingly.
