News

US Stud's Innovative Scheme

3rd Mar 2009

Stallions - Mike Hedge - Wednesday, 4 March 2009

Kentucky stud Darby Dan Farm has come up with an innovative scheme to protect the interests of breeders sending mares to its stallions and therefore enhance the market.

In an open letter to breeders, Darby Dan announced this week the reintroduction of its Profit Protection Program.

The scheme which allows breeders to pay back service fees after the resultant yearlings sell will apply to those stallions standing at the farm at fees of $10,000 and less.

Such stallions include Sun King, Nobiz Like Shobiz, Run Away And Hide and Magna Graduate.

Essentially, Profit Protection works like a pay-from-proceeds contract – but with much more favorable terms for the breeder.

The first $5,000 of gross sale proceeds goes directly to the breeder with the remaining sales proceeds, if any, split 50/50 between the mare owner and Darby Dan until the advertised stud fee has been paid. All further monies go to the breeder.

Unlike a normal pay from proceeds where the entire stud fee must be paid before the breeder receives any funds, with Profit Protection the breeder gets money first. Moreover, there is no limit on the reduction of stud fee should there be insufficient sale proceeds to satisfy 100% of the stud fee. In the case of a sale of $5,000 or less, no stud fee is due.

Only a limited number of mares per stallion will be allowed to participate in this program and will be accepted on a first-come first-served basis.