Video and Internet Auction Terms and Conditions

NUMBER OF HEAD: The number of head is the actual number of cattle to be delivered to the Buyer after sorting off any cattle that are not described in the contract and any un-merchantable cattle. At delivery, the Buyer, Buyer's Agent, Superior Livestock Auction ("SLA") or the Marketing Representative shall have the right to sort and reject any stags, crippled, blind, bad eyed, loco, lump-jawed or otherwise un-merchantable cattle or any cattle that are not described in the contract as determined by the Marketing Representative. The Seller is obligated to deliver to the Buyer the number of head stated in this contract.

FAILURE TO DELIVER: Upon the Seller's failure to deliver to the Buyer the number of head stated in this contract (regardless of the reason, except an Act of God), the Seller shall be liable for replacing any cattle not delivered with cattle of equal size and quality or pay the Buyer the difference between the price stipulated in the Livestock Forward Contract and the prevailing market price on the number of head not delivered, which shall be based on the average weight of those delivered and/or make the necessary freight adjustment to the Buyer. The replacement of cattle, monetary adjustment and/or freight adjustment shall be at the Sellers expense and the Buyers option and approval.

LOAD LOTS: Unless otherwise stated, cattle will be sold in load lots with a maximum weight of 48,000 pounds per load. At delivery, if the average weight exceeds the base weight, the Buyer will not be required to accept the total number of head sold in the Livestock Forward Contract if the total pay weight of the load exceeds 48,000 pounds.

BASE WEIGHT: The base weight is the estimated average weight of the cattle at delivery. If the average weight of some or all of the cattle at delivery is excessive on either side of the base weight (light or heavy) and/or the cattle change class based upon industry standards, as determined by SLA, one of the following may occur: 1) the cattle may be rejected by the Buyer or at the discretion of SLA and/or the Marketing Representative 2) the price may be re-negotiated 3) the Seller may be required to make an equitable adjustment to the Buyer.

SLIDE: All cattle will be sold on a sliding scale with a Conventional Slide, Superior RightSlide or 2 Way Slide, as described in the following paragraphs:

Conventional Slide: If the average weight is over the base weight the price/cwt will be adjusted by the amount stated in the contract for every pound over that weight on the total net pounds. Example: A load of steer calves with a base weight of 500 pounds sell for $150.00/cwt. At delivery they can weigh up to 500 pounds and the price will not change. If they weigh 501 pounds (average) with a 15 cent slide the price will be adjusted to $149.85/cwt; 525 lbs.-$146.25/cwt; 550 lbs.-$142.50/cwt. If they average 551 pounds the slide may be increased 2 cents to a 17 cent slide, for an adjusted price of $141.33/cwt. If the cattle are excessively heavy, an additional increase in the slide, a weight stop and/or a price negotiation may be necessary to make an equitable adjustment to the Buyer.

Superior RightSlide: The Seller will be paid the contract price up to the base weight and an additional amount per pound, as stated in the RightSlide information, for every pound over the base weight. Example: A load of steer calves with a base weight of 500 pounds sell for $150.00/cwt. At delivery, if they weigh 525 lbs. (average) with an 80 cent ($.80) RightSlide the dollars per head will be calculated as follows: 500#@ $150.00/cwt = $750.00 + 25#@ $.80/pound = $20.00, for a total cost per head of $770.00 or $146.67/cwt. If the cattle are excessively heavy, a decrease in the slide or a weight stop may be necessary to make an equitable adjustment to the Buyer.

2 Way Slide: Cattle sold on a 2 way slide will have a 25 pound weight stop over the base weight and a 25 pound price/slide stop under the base weight. Over: If the average weight is within 1 to 25 pounds over the base weight the price/cwt will be decreased by the amount stated in the contract for every pound over the base weight on the total net pounds. Example; A load of steer calves with a base weight of 500 pounds sell for $150.00/cwt. At delivery, if they weigh 510 pounds (average) with a 15 cent slide the price will be adjusted to $148.50/cwt; 525 lbs.-$146.25/cwt. If they average over 525 pounds there will be a weight stop. Example of settlement with average weight of 535# at delivery: 525#@ the slid price of $146.25/cwt. and 10 pounds free, for a total of $767.81 per head or $143.52/cwt. Under: If the average weight is within 1 to 25 pounds under the base weight the price/cwt will be increased by the amount stated in the contract for every pound under the base weight. Example: A load of steer calves with a base weight of 500 pounds sell for $150.00/cwt. At delivery, if they weigh 490 pounds (average) with a 15 cent slide the price will increase to $151.50/cwt; 475 lbs. - $153.75. If they average less than 475 pounds there will be a price/slide stop. Example of settlement with an average weight of 465# at delivery: 465# @ the slid price of $153.75/cwt, for a total cost of $714.94 per head.

WEIGHING CONDITIONS: The Seller is responsible for making arrangements to weigh on certified scales that are compliant with GIPSA (Grain Inspection and Packers & Stockyards Administration) regulations. Those regulations require scales to be tested twice during each calendar year (once between January 1 and June 30 and once between July 1 and December 31 ); EXCEPT for scales used on a limited seasonal basis (which is during any continuous 8 month period) and those scales may be used within an 8 month period following each test. Split weighing is not permitted. OVERNIGHT DRY STAND: Cattle sold with an "overnight dry stand" must be penned with no feed or water the evening prior to delivery and remain dry lotted until after they are weighed.

ESTIMATED WEIGHT VARIANCE: FARILY EVEN (0-10% +/- pay weight) ,UNEVEN (10-15% +/- pay weight), VERY UNEVEN (15-25% +/- pay weight). Seller warrants that no individual animal will vary more or less than these percentages from the average pay weight at delivery. SLA or Marketing Representative reserves the right to reject any animals that are not within these percentages.

CURRENT LOCATION: Seller agrees that the cattle described in the contract will be located at the current location listed on the contract, where they shall remain and be handled in their normal manner until delivery. If cattle must be moved or changed to a different kind of feed or pasture, for any reason, SLA or Marketing Representative must be notified and change will only be permitted only with the Buyer’s consent.

DELIVERY MATURITY DATE: Seller agrees to deliver cattle to Buyer’s trucks at the location stated type and on/between the delivery dates listed in the contract, at the option of the Marketing Representative, unless otherwise stated.

 PAYMENT TO SELLER: If the said livestock described in this contract are encumbered by a lien, a security interest or chattel mortgage, it is the Sellers responsibility to provide proper notice to SLA so payment can be issued jointly with the Seller and all secured parties. PAYMENT TO OTHERS: If the said livestock described in this contact are not encumbered, the Seller may authorize SLA to disburse proceeds of the sale to others. If the livestock are encumbered SLA will not make payment to others without a written release from the secured party.

ACKNOWLEDGMENT: Seller acknowledges that the transactions contemplated herein are part of the livestock forward contract trade. Seller acknowledges that SLA is in the business of entering into forward contracts as merchants in the livestock trade and with merchants in the livestock trade; and Seller acknowledges that the livestock described in this contract are commodities for purposes of the Commodity Exchange Act.

COMMISSION: Seller agrees to pay SLA a commission of 2% (two percent) of the gross proceeds of the sale (with a minimum of $8.00 per head) plus a $2.00 per head consignment fee on the number of head delivered.

PART PAYMENT: Upon the sale of the livestock SLA will advance the Seller $30.00 per head, as part payment, for the livestock described in this contract. In the event the Seller fails to deliver the livestock as described in this contract, or if the cattle are rejected because they are not as described in this contract, or at the time of delivery there are any Federal or State regulations prohibiting interstate shipment of said livestock, Seller shall return SLA all money advanced and this contract will become null and void. Seller acknowledges SLA will receive $40.00 per head, as part payment, from the Buyer. The $10.00 per head received from Buyer and not paid to Seller will be held in SLA's Custodial Account for Shipper's Proceeds until the livestock deliver. EXCEPTION: No part payment will be paid on heifers that the Seller represents to be "open"; nor on any cattle that are not in the continental United States at the time of sale; nor on any cattle that deliver within 7 days after the conclusion of the auction.

FINAL PAYMENT: On the day of delivery SLA will issue a check to the Seller for the balance of the purchase price less SLA's commission and any other adjustments or lawful charges. Upon the Seller's receipt of final payment from SLA, Seller grants SLA the right to exercise all rights and remedies available to Seller and all interests of Seller in the livestock described in this contract, under all applicable law, including, but not limited to, those rights available to Seller under the Livestock Forward Contract for the sale of the livestock described herein.

EXPENSES OF SELLER: Seller shall be responsible for the expense of weighing and all fees subject to Federal and State regulations; such as health inspection, brand inspection, Beef Checkoff and any other statutory fee requirements.

NO SALE OR PASS OUT FEE: If Seller elects to decline the highest bid offered at the auction, he/she must do so before the next lot is offered. If Seller declines the highest bid he/she will be charged a no sale/pass out fee of $3.00 per head on the number of head offered, with a maximum of $1,500.00 per consignor, per auction. If the $3.00 per head is paid prior to the auction it will be held by SLA until the conclusion of the auction and if the cattle sell the Seller's check will be returned uncashed. If the cattle do not sell the Seller's check will be cashed and applied to the no sale/pass out fee. If this fee is not paid prior to the auction and the Seller receives a part payment this fee will be deducted from the part payment. If Seller does not receive a part payment he/she will be billed and the fee will become due and payable. SCRATCH FEE: If for any reason Seller withdraws said livestock from the auction they will be allowed to re-consign them to one of the next two consecutive auctions. If Seller withdraws said livestock and does not re-consign them, there will be a scratch fee of $3.00 per head on the number offered with a maximum of $1,500.00 per consignor, per auction. This fee will be collected in the same manner as stated above.

AMENDMENTS TO CONTRACT: Seller hereby appoints SLA and the Marketing Representative, as Seller's attorney-in-fact, to amend the provisions of this contract at any time prior to sale, or if necessary to accurately describe the livestock covered by this contract. PARTIAL INVALIDITY: No partial invalidity of this agreement shall affect the remainder.

ARBITRATION OF DISPUTES: Any controversy or claim arising out of or relating to this Agreement, or the breach thereof, shall be submitted to binding arbitration upon the written demand of any party to this agreement, which demand shall be served on all parties at the addresses set forth herein. The parties shall promptly submit the dispute to the American Arbitration Association (the "AAA") for resolution by a single neutral arbitrator acceptable to both parties, as selected under the rules of the AAA. The dispute shall then be administered according to the AAA's Commercial Arbitration Rules, with the following modifications; (i) the arbitration shall be held in Oklahoma City, Oklahoma; (ii) the arbitrator shall have no power or authority to make any award that provides for consequential, punitive or exemplary damages. Judgment on the award rendered by the arbitrator may be entered in any court having jurisdiction over the parties. Each party to the dispute shall initially bear its own fees and expenses arising out of the arbitration. However, the arbitrator may award reasonable attorney's fees and arbitration fees to the prevailing party in the arbitration. If SLA becomes the successor in interest to the rights of the Seller under this contract, then SLA shall have the right, at its election, not to be bound to mandatory arbitration under this section, and may, at its election, pursue its claims in the state or federal courts located in Oklahoma City, Oklahoma which shall have jurisdiction and venue over the dispute and parties. The prevailing party in such litigation shall be entitled to recover its reasonable attorney's fees and court costs from the non-prevailing party.

DESIGNATION OF AGENT: Seller hereby authorizes SLA to complete and sign the Livestock Forward Contract for the sale of the livestock described in this contract, on behalf of and in the name of Seller, which will make Seller obligated to the Auction Terms and Conditions and to all terms and conditions of the Livestock Forward Contract, as if Seller had signed the contract himself. Seller also authorizes SLA to negotiate a satisfactory settlement regarding any disputes at delivery and assigns to SLA all rights of Seller after Seller receives final payment from SLA.