I was curious about what an actual off-take agreement covers and...

I was curious about what an actual off-take agreement covers and found this piece of information from http://www.ehow.com/about_5571814_offtake-agreement.html.

On the benefits of an off take it states:

"Offtake agreements have benefits for both the sellers and buyers of goods in this type of legal contract. Sellers use offtake agreements to ensure that they have a buyer for future goods produced through their operations. Prices are agreed upon at the time of the contract, ensuring that sellers cannot offer a lower price in the future. Buyers use the agreement as a hedge against future prices in case of a future supply shortage. Additionally, any future supply shortages enable companies with offtake agreements to increase market share, raising their profits."

The part that caught my eye is that the price is agreed upon up front. Is this consistent with other off-takes? what price would most likely be used: spot, contract? guess it will also depend on the volumes being negotiated too. the timing seems perfect if that's the case, unless of course, the prices continue to rise and we limit our upside potential agreeing to a fixed price.

Thought I might get some comments from those who've been through one before with other stocks.