U S Premium Beef Llc
Business Description
U.S. Premium Beef, LLC (USPB) was organized in July 1996 as a Kansas cooperative
by a steering committee of cattle producers. USPB’s goal is to provide
market access and improve the marketing and processing of beef products requiring
higher quality cattle for wholesale and retail customers and consumers while
providing higher returns to cattle producers. USPB operates an integrated cattle
processing and beef marketing enterprise where consumer and processor demands
and requirements are implemented through changes in genetics, feeding, and management.
USPB’s unitholders benefit from its supplier alliance with National Beef
Packing Company, LLC (NBP) through (i) premiums received in excess of cash market
prices for higher quality cattle, (ii) allocations of profits and losses and
potential distributions, (iii) potential unit price appreciation, and (iv) information
that permits unitholders to make informed production decisions.
As USPB filed a registration statement with the Securities and Exchange Commission
in connection with its 2004 Conversion from the cooperative form of business
organization to an LLC structure, USPB is subject to the informational requirements
of the Securities Exchange Act of 1934 (Exchange Act), although USPB is not
required to be registered under the Exchange Act. Accordingly, USPB files periodic
reports and other information with the Securities and Exchange Commission (SEC).
Such reports, proxy statements and other information may be obtained by visiting
the Public Reference Room of the SEC at 100 F Street, N.E., Washington, D.C.
20549 or by calling the SEC at 1-800-SEC-0330. In addition, the SEC maintains
an Internet site (www.sec.gov) that contains reports and information statements
and other information regarding USPB and other issuers that file electronically.
USPB provides an integrated cattle production, processing and marketing system
for the benefit of its unitholders and associates. As the basis of that system,
USPB’s unitholders have a guaranteed right plus an obligation (on a one
head per Class A unit per delivery year basis) to deliver cattle to USPB, pursuant
to the Uniform Cattle Delivery and Marketing Agreement (see Cattle Delivery
Arrangements). USPB facilitates the delivery of cattle to NBP for processing
and subsequent product distribution and marketing. Shortly after the cattle
are processed, cattle suppliers receive, at no extra charge, individual animal
carcass data previously considered proprietary by many processors. This carcass
data assists producers in refining production methodologies, thereby improving
the product quality and subsequently enhancing the return to the producer.
We believe the primary advantage of USPB’s ownership in NBP centers around
USPB’s ability to provide NBP with a consistent supply of quality beef
from a verified source, allowing NBP to target higher margin value-added markets.
Consumers have historically demonstrated their willingness and desire to buy
branded products that offer better value in other consumer product markets,
with the Certified Angus Beef® product line being an example in the beef
industry.
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