2. The letter of credit is issued on bank letterhead.
3. The letter of credit is issued for an initial period of at least one year.
4. The letter of credit renews automatically unless at least 90 days before the scheduled renewal date the issuing bank gives the department written notice, in person or by certified mail, that the letter of credit will not be renewed.
5. The letter of credit is issued in a form, and subject to any terms and conditions, that the department considers appropriate.
(e) Security filed under ch. 127, 1999 stats., before September 1, 2002, except that on January 1, 2003, the department shall withdraw its approval of any security that is not approvable under pars. (a) to (d).
(5) Department custody of security. The department shall hold, in its custody, all security filed and maintained under this section. The department shall hold the security for the benefit of grain producers and producer agents who deliver grain to a grain dealer.
(6) Monthly reports. A grain dealer who is required to file or maintain security under this section shall file monthly reports with the department. The grain dealer shall file a report on or before the 10th day of each month, in a form specified by the department. In a monthly report, a grain dealer shall provide information reasonably required by the department, including all of the following:
(a) The grain dealer's average monthly payment for the 3 months, during the preceding 12 months, in which the grain dealer made the largest monthly payments for producer grain procured in this state.
(b) The grain dealer's highest total unpaid obligations, at any time during the preceding 12 months, for producer grain procured in this state under deferred payment contracts. If the amount owed on deferred price contracts has not yet been determined, the grain dealer shall estimate the amount based on contract terms and prevailing market prices on the last day of the previous month.
(7) Additional security. (a) The department may, at any time, demand additional security from a grain dealer if any of the following applies:
1. The grain dealer's existing security falls below the amount required under sub. (3) for any reason, including depreciation in the value of the security filed with the department, an increase in grain payments or grain prices, or the cancellation of any security filed with the department.
2. The grain dealer fails to provide required information that is relevant to a determination of security requirements.
(b) The department shall issue a demand under par. (a) in writing. The department shall indicate why the security is required, the amount of security required, and the deadline date for filing security. The department may not specify a deadline for filing security that is more than 30 days after the date on which the department issues its demand for security.
(c) A grain dealer may request a hearing, under ch. 227, on a demand for security under par. (b). A request for hearing does not automatically stay a security demand.
(d) If a grain dealer fails to comply with the department's demand for security under this subsection, the grain dealer shall give written notice of that fact to all grain producers and producer agents from whom the grain dealer procures producer grain in this state. If the grain dealer fails to give accurate notice under this paragraph within 5 days after the deadline for filing security under par. (b) has passed, the department shall promptly notify those grain producers and producer agents by publishing a class 3 notice under ch. 985. The department may also give individual notice to those grain producers or producer agents of whom the department is aware.
(e) If a grain dealer fails to comply with the department's demand for security under this subsection, the department may do any of the following:
1. Issue a summary order under s. 126.55 (2) that prohibits the grain dealer from procuring producer grain or requires the grain dealer to pay cash on delivery for all producer grain.
2. Suspend or revoke the grain dealer's license.
(8) Releasing security. (a) The department may release security filed under sub. (1) (a), except for any amount of security that the grain dealer is required to file because sub. (1) (b) applies to the grain dealer, if any of the following applies:
1. The grain dealer reports, for at least 2 consecutive years, no more than $500,000 in annual grain payments under s. 126.11 (9) (a) and the grain dealer pays the quarterly fund assessment that would have been required of the grain dealer if the grain dealer had been a contributing grain dealer on the most recent quarterly installment date under s. 126.15 (7).
2. The grain dealer's annual financial statement under s. 126.13 shows positive equity for at least 2 consecutive years and the grain dealer pays the quarterly fund assessment that would have been required of the grain dealer if the grain dealer had been a contributing grain dealer on the most recent quarterly installment date under s. 126.15 (7).
(b) The department may release security filed under sub. (1) (b), except for any amount of security that the grain dealer is required to file because sub. (1) (a) applies to the grain dealer, if any of the following applies:
1. The grain dealer has not had any deferred payment contract obligations since the beginning of the grain dealer's last completed fiscal year.
2. The grain dealer files 2 consecutive annual financial statements under s. 126.13 showing that the grain dealer meets the applicable equity requirement and debt to equity ratio under sub. (1) (b).
(c) On December 1, 2002, the department may release security maintained under sub. (2), unless the grain dealer is required to file security under sub. (1).
(d) The department may release security to the extent that the security exceeds the amount required under sub. (3).
(e) The department may release security if the grain dealer files alternative security, of equivalent value, that the department approves.
(f) The department shall release security if the grain dealer is no longer in business and has paid all grain obligations in full.
126.17 Grain dealers; records. (1) Records and accounts; general. A grain dealer shall keep records and accounts of all grain procured and all grain sold or marketed by the grain dealer. A grain dealer shall keep records that are complete, accurate, current, well-organized, and accessible, so that the grain dealer and the department can readily determine all of the following:
(a) The kinds and amounts of grain procured, the procurement dates, the procurement terms, and the persons from whom the grain dealer procured the grain.
(b) The kinds and amounts of grain sold or marketed, the sale or marketing dates, the sale or marketing terms, and the persons to whom the grain dealer sold or marketed the grain.
(c) The kinds and amounts of grain, received from others, that the grain dealer has used for feed, seed, milling, manufacturing, processing, or other purposes.
(d) The kinds and amounts of grain, received from others, that the grain dealer has on hand, including the kinds and amounts of grain owned by the grain dealer, and the kinds and amounts of grain held for others.
(e) The nature and amount of the grain dealer's obligations to grain producers and producer agents, including obligations under deferred payment contracts. The grain dealer shall keep a daily record of obligations under priced contracts and a separate daily record of obligations under deferred price contracts that have not yet been priced.
(f) The nature and amount of the grain dealer's obligations to depositors, as defined in s. 126.25 (5), under agreements for the storage of grain, if any.
(g) The grain dealer's accounts receivable from the sale or marketing of grain, including the names of the account debtors, the amount receivable from each account debtor, and the dates on which payment is due.
(2) Records of grain procured. A grain dealer shall keep records all of the following related to each shipment of grain procured by the grain dealer:
(a) The kind and weight of grain procured.
(b) The grade and quality of the grain if determined.
(c) The date on which the grain dealer procured the grain.
(d) The name and address of the person from whom the grain dealer procured the grain.
(e) Whether the grain dealer purchased the grain, holds it under an agreement for storage, or is marketing the grain as a producer agent.
(f) The terms of purchase, storage, or marketing.
(g) If the grain dealer procured the grain under a deferred payment contract, the terms of that contract.
(3) Records retention; inspection. (a) A grain dealer shall keep copies of all of the following records for at least 6 years after the records are created:
1. Records required under this section and s. 126.18 (2).
2. Records that the grain dealer was required to keep, under ch. 127, 1999 stats., and department rules, before September 1, 2002.
(b) A grain dealer shall make records required under this section available to the department for inspection and copying upon request.
126.18 Grain dealers; receipts for grain. (1) Requirement. Whenever a grain dealer receives grain from any person, the grain dealer shall immediately give that person a written receipt for the grain that includes all of the following:
(a) The name of the grain dealer and a statement indicating whether the grain dealer is a corporation.
(b) A permanent business address at which the holder of the receipt can readily contact the grain dealer.
(c) A statement identifying the document as a receipt for grain.
(d) The date on which the grain dealer received the grain.
(e) The kind of grain received.
(f) The net weight of grain received or, if the grain dealer receives the grain at the grain producer's farm, the approximate net weight of the grain.
(g) The grade and quality of the grain, if determined.
(h) A statement identifying the receipt as a purchase receipt, storage receipt, or receipt for grain marketed by the grain dealer as a producer agent.
(i) The grain dealer's promise to pay the total amount due for grain, less any discounts that may apply, within 7 calendar days after the date of receipt of the grain. This requirement does not apply if any of the following applies:
1. The grain dealer pays cash on delivery.
2. The grain dealer receives the grain under a deferred payment contract that complies with s. 126.19.
3. The receipt is clearly identified as a storage receipt.
(1m) Effect of failure to identify receipt. A receipt not clearly identified under sub. (1) (h) is considered a purchase receipt except that, if the grain dealer also operates as a grain warehouse keeper, as defined in s. 126.25 (9), under the same name, a receipt not clearly identified is considered a storage receipt.
(2) Grain dealer's copies. A grain dealer shall keep copies of all receipts issued under sub. (1).
126.19 Grain dealers; deferred payment contracts. (1) Contract in writing. A grain dealer may not procure grain from any grain producer or producer agent under a deferred payment contract before the contract is reduced to writing and signed by the parties. The grain dealer shall provide a copy of the signed contract to the other party.
(2) Contents of contract. A grain dealer may not enter into a deferred payment contract unless the deferred payment contract includes all of the following:
(a) A unique contract identification number.
(b) The type, weight, grade, and quality of grain procured and a statement that price adjustments may apply if delivered grain varies in grade or quality from that identified in the contract.
(c) The price for the grain or, in a deferred price contract, the method and deadline by which the price will be determined.
(d) The date by which the grain dealer agrees to make full payment for the grain, which may not be more than 180 days after the date on which the contract price is established or more than 180 days after the date on which the grain dealer takes custody or control of the grain, whichever is later.
(dm) If the contract is a deferred price contract, a pricing deadline that is not more than one year after the date on which the grain dealer takes custody or control of the grain.
(e) The grain dealer's permanent business location.
(f) Other information required under this section.
(3) Payment and pricing deadlines. (a) A grain dealer shall make full payment under a deferred payment contract by the deadline date specified in the contract.
(b) The parties may not extend a payment or pricing deadline under sub. (2) (d) or (dm), except that they may sign a new contract that extends either deadline or both deadlines for up to 180 days if the new contract refers to the contract number of the original contract.
(4) Required notice. A grain dealer may not enter into a deferred payment contract unless the deferred payment contract clearly discloses that it is not a storage contract. Whenever a grain dealer buys grain from a grain producer under a deferred payment contract, the grain dealer shall include the following statement in capitalized, boldface print immediately above the contract signature line: "This is not a storage contract. The grain dealer (buyer) becomes the owner of any grain that the producer (seller) delivers to the grain dealer under this contract. The producer relinquishes ownership and control of the grain, and becomes an unsecured creditor pending payment."
(5) Deferred payment contract assessment. From the amount that a grain dealer pays to a grain producer or producer agent under a deferred payment contract, the grain dealer shall deduct a deferred payment contract assessment. The assessment shall equal the total amount owed under the contract before the assessment is deducted, multiplied by the deferred payment assessment rate that applies under s. 126.15 (6) when the contract is made. The grain dealer shall disclose the assessment amount or, if the contract is a deferred price contract, the method by which the assessment amount will be determined, in the written contract under sub. (1).
126.20 Grain dealers; business practices. (1) Grain weight, grade, and quality. A grain dealer shall do all of the following when determining the weight, grade, or quality of grain:
(a) Accurately determine the weight, grade, or quality using accurate weighing, testing, or grading equipment.
(b) Accurately record the determined weight, grade, or quality.
(2) Timely payment to producers. A grain dealer shall pay for grain when payment is due. A grain dealer may not make payment by nonnegotiable check or note or by check drawn on an account containing insufficient funds.
(3) Permanent business location. A grain dealer licensed under s. 126.11 shall do all of the following:
(a) Maintain a permanent business address at which grain producers may readily contact the grain dealer during business hours.
(b) On each day that the Chicago Board of Trade is open for trading, keep business hours that start no later than 9 a.m. and end no earlier than 2:30 p.m.
(c) Prominently post the grain dealer's business hours at each of the grain dealer's business locations in this state.
(4) Prohibited practices. No grain dealer may do any of the following:
(a) Misrepresent the weight, grade, or quality of grain received from or delivered to any person.
(b) Falsify any record or account, or conspire with any other person to falsify a record or account.
(c) Make any false or misleading representation to the department.
(d) If the grain dealer is licensed under s. 126.11, engage in any activity that is inconsistent with a representation made in the grain dealer's annual license application.
