Section 281.50  Price Later Contracts

a)         Prescribed Form

            A price later contract executed between a licensee and a producer shall be on a prescribed form which has been approved by the Department.  The prescribed form shall include, but need not be limited to, the following information:

1)         The legal name and address of the licensee;

2)         The legal name of the seller;

3)         The bushel amount of grain to be covered by the contract;

4)         The grade and commodity of grain to be covered by the contract;

5)         The dates of delivery of the grain to be covered by the contract;

6)         The method of pricing;

7)         A section to indicate service charges, advances or other terms;

8)         The following statements:

A)        That title to the grain covered by this contract passes to buyer upon delivery;

B)        Buyer is required to maintain grain assets and price later, storage, and drying service charges equal to 90% of its price later obligations;

C)        Price later grain is not stored for the seller.  This contract is regarded as a grain dealer claim.  The maximum coverage afforded by the Illinois Grain Insurance Fund is 85% of the valid grain dealer claim amount up to a maximum of $100,000 per claimant.  A valid grain dealer claim includes all groups of contracts that in any way can be related or tied to a person or entity whether in full or in part;

D)        This contract shall cease to be the basis of a valid claim against the Illinois Grain Insurance Fund:

i)          Upon the expiration of 160 days after the grain sold under this contract is priced; or

ii)         Upon the expiration of 270 days after the latter of the execution of this contract or the date of delivery of the grain sold under this contract;

E)         The execution of subsequent price later contracts by the producer and the licensee for grain previously covered by a price later contract shall not extend the coverage of a claim beyond the original 270 days;

F)         Contract must be signed by both parties within 30 days after the last date of delivery or the grain will be priced on the next available business day at the closing price on that day;

9)         A section indicating the signature and date of signature for both the seller and buyer's representative;

10)         The reverse of the contract shall contain a schedule of settlements for the grain to be covered by the contract.

b)         Printing

A price later contract shall be printed by a person authorized to print such contracts by the Department.  The Department shall authorize persons to print price later contracts if they are printed in accordance with the Grain Code and the rules of this Part and if they have posted the required bond. The printer shall provide a surety bond in the sum of $5,000 payable to the Illinois Department of Agriculture, Director of the Department of Agriculture as Trustee.  All price later contracts shall be:

1)         Printed only for licensees.

2)         Numbered consecutively either at the time of printing or through the control of a computer generated system.

3)         A complete record of contracts printed shall be retained by the printer for 5 years, showing for whom printed, the number printed, and the consecutive numbers that were printed on the contracts.

c)         Separate Series

Each location at which price later contracts are issued shall have its own identifiable series of price later contracts.

d)         Requirements for Use of Price Later Contracts

1)         Only one commodity per contract.

2)         The bushel quantity of a price later contract may not be increased.

3)         Price later contracts are to be executed in triplicate with the original copy maintained by the dealer.

4)         The dealer shall maintain the updated and signed contracts in numerical order.

5)         No storage charges shall be made with respect to any commodity purchased by price later.  A service charge may be assessed.

6)         A rollover shall be documented with the initials of both parties and dated by both parties.

7)         Grain assets included in the assets required to meet 90% of outstanding price later obligations do not have to be commodity specific.

e)         Pre-delivery Price Later

When a price later contract is used as a pre-delivery contract, the original bushel amount may be adjusted down to reflect the actual amount of grain delivered against the contract.

(Source:  Amended at 21 Ill. Reg. 5526, effective April 22, 1997)