cash commodity exchange
The Grainnet Exchange will host trading for Members according to established rules and regulations (“Trading Rules”) set forth in this document. The Exchange may modify these rules and it is the responsibility of the Members to be aware of the current Trading Rules. The current Trading Rules will be posted on the Website at www.grainnet.org.
Grainnet Exchange will allow Members to post Offerings and Bids on various listed products. Sellers and Buyers will responsible for transactions fees and those fees will be netted out from the settlement sheet on each transaction. Those Transaction Fees will be posted on the Website and are subject to change. Member traders will view offerings by product and by seller or geographic region.
Each executed transaction will be confirmed with an email or text advice immediately following the consummated transaction. With 24 hours both Buyer and Seller will receive a Smart Contract by email that is automatically accepted unless protested within 24 hours of receipt. The Contract will govern the schedule, delivery and finally payment. Settlement and clearing services will conclude each contract performance. The Grainnet Exchange is not a counterparty or guarantor to any transactions executed on the Exchange.
Article I. TRANSACTION RULES
Section 1.01 The following Transaction Rules are incorporated into and subject to the terms of the Membership Agreement between the Member and Grainnet Exchange. You, as a Member, agree to abide by such Transaction Rules as a condition to your use of the Site and participation on the Exchange.
(a) Transaction Rules - General
1. Only Members may sell or purchase products and services through the Site. Lots of grain will be offered in regularly scheduled live auctions by Dutch Auction with the award given to first bidder. Offering prices will begin at the top side of the buying range and drop in .5 cent a bushel ticks until a buyer clicks to buy. The first Member to click to buy will win the contract. Sellers may immediately offer additional quantities of grain [within 10 seconds] and Buyers must immediately confirm the acceptance of additional quantities of grain [within 10 seconds]. All quantities will be added to one contract. Alternatively, some Sellers may post offerings on the Exchange and bid/ask trading will occur using Instant Messaging [IM].
(i) You must keep your User Name, and Password confidential at all times.
(ii) A “Transaction” is created on the Exchange when an Offering is purchased by a Buyer. A Transaction Confirmation is created according to rules of the Exchange. A Transaction may be created in live auctions or through posted Lot listings of grain with the acceptance of both parties.
(iii) A “Contract” is created upon the consummation of a Transaction and the delivery of a “Transaction Confirmation” to both parties to the transaction [Buyer and Seller].
(iv) A Transaction is binding on both parties for the transaction referenced in the Confirmation and may not be unilaterally altered by any party.
(v) All Transactions on the Exchange are confidential among the Buyer, Seller and Grainnet Exchange. The Buyer will not be disclosed to the other Members although Sellers will offer under the Seller’s name. Grainnet may aggregate trade information on the Exchange without disclosing the parties.
(vi) Sellers may offer supplemental offerings but supplement offerings must be offered on the Exchange and not through private treaty trading.
(vii) Grainnet Exchange reserves the right to revoke the access privileges of any Members that fail to conduct business in an honest and fair manner or abide by applicable laws or rules of the Exchange, or who engages in activities or practices in order to manipulate or circumvent rules on the Exchange.
(viii) Sellers agree not to manipulate the price of any products or services offered on the Exchange, either through the use of shills, alias or decoys, or by acting as a Buyer in respect of such proposed sale.
(ix) Buyers and Seller consummated transactions will be subject to the transaction fees. Our current Table of Transaction Fees is available on the web site to all qualified Members. The obligation to pay Grainnet Exchange the Transaction and Clearing Fees arises at the time a Transaction occurs on the Exchange. Unless otherwise stated, all fees are quoted in U.S. dollars. A Buyer’s or Seller’s breach of its obligations in respect of any Transaction will not relieve Seller of its obligation to pay to Grainnet Exchange a Transaction Fee in respect of such breached Transaction. Transaction Fees will be collected when the product settles and clears.
(b) General Transaction Rules – Buyer
(i) Buyers will qualify to purchase from any Seller but may choose not to purchase from any Seller. Grainnet may restrict the dollar amount of purchases by any Buyer at its sole discretion of the Exchange. It is the Buyer’s responsibility to select the lots of grain on which to bid.
(ii) Buyers can put up an unlimited amount of bids and engage in viewing an unlimited amount of offers. However, Buyers are solely responsible for their ability to meet all financial commitments made.
(iii) All bids must be made in U.S. dollars.
(c) Trade rules for Listed Lots of Grain [not live auctions]
(i) A Buyer can view offers by accessing the approved Lot Listing on the Exchange.
(ii) Offers viewed by Buyer will be Firm offers made by Sellers. A “firm offer” is one a Buyer can hit and create a “Matched trade”.
1) Firm Offer: Sellers may list offering prices as fixed prices or contingent prices basis the CME appropriate grain contract (“Basis Trade”). A Buyer can accept the offering price, or counter a Firm Offer with a firm Bid using IM. Acceptance of a Firm Offer creates a Transaction and is binding for both parties based on the terms of the offer. A Buyer may counter a Firm Offer with a Firm Bid. If the Seller accepts this Firm Bid, a Transaction is created. Buyers or Sellers may restrict the duration of a Firm Bid, Offer or Counteroffer. This restriction will be made in minutes a firm offer or bid will be valid.
2) Firm, Subject to Current Trade: A Buyer can open a “live trading session” with a Seller. A Live trading session is exclusive to the two parties and can not be monitored or interrupted by other Members. Live sessions are timed and if no trade is consummated within the time parameters then the session terminates. The Listed Lot is not available to other Buyers when two parties are in a Live Trading Session.
(d) Placing an “Bid”
(i) Buyers can submit a Bid by placing a valid price and quantity on a Listed Lot of grain on the Exchange.
(ii) Buyers determine the length of validity for a Bid by setting the Bid’s expiration date and time.
(iii) A Buyer can create only a Firm Bid.
1) Firm Bid: A Buyer can create a Firm Bid. Acceptance of a Firm Bid by a Seller creates a Transaction and is binding for both parties based on the Bid price and terms offered. A Seller may counter a Firm Bid with a Firm Counteroffer.
(e) Creating Offers
(i) Sellers can initiate a Transaction by placing or listing an offer on the Exchange. The description and offering terms must be approved by Exchange officials. The offerings will include all required information for grain offerings as posted and modified from time to time on the website.
(ii) Sellers determine the length of Firm Offers by setting the offer’s expiration date and time. Grain offered on live auctions will be committed to the First bidder.
Article II. Freight
Section 2.01 All Offerings will set forth the terms of purchase including the responsibilities of the parties to the transaction for freight. The Exchange may quote a typical freight rate in $ per mile but this will not set the rate and the parties are responsible for grain freight as set forth in the contract. The offering will be designated by Seller as:
(a) F.O.B. or picked up by Buyer at point of origin; or
(b) Delivered. Seller will arrange to deliver the commodity to Buyer’s location as disclosed in the transaction.
Article III. Settlement and Clearing
Section 3.01 Settlement for all transaction on the Grainnet Exchange Exchange will be according to official settlement postings by the Exchange. Clearing will be executed by Bank of Commerce upon instruction of the Grainnet Exchange according to the Smart Contracts. All information pertaining to deliveries, weights, quantities and money flows will be transparent to Buyer and Seller. All funds transfers will be executed using ACH transfers with notice to the parties prior to the funds transfer.
Section 3.02 All transactions will have a settlement date and on the settlement date the Buyer will settle in collected funds to a Custodial account at the Bank of Commerce the funds necessary close the transaction. Sellers will be paid in collected funds to their bank account within one business day.
Section 3.03 Fees. All Transaction Fees will be deducted from the settlement according to posted fees on the Exchange. All freight may or may not be included in the settlement according to terms of the contract and will be paid electronically using ACH transfers to the freight company.
Section 3.04 Disputes. All trade disputes will be handled by the Arbitrator according to the rules set forth in the Membership agreement.