12. Agreements

J.D. Heiskell Working Capital Agreements. Pursuant to a Corn Procurement and Working Capital Agreement with J.D. Heiskell, AAFK procures whole yellow corn from J.D. Heiskell. AAFK has the ability to obtain grain from other sources subject to certain conditions; however, in the past all AAFK grain purchases have been from J.D. Heiskell. Title to and risk of loss of the corn pass to AAFK when the corn is deposited into the Keyes Plant weigh bin. Pursuant to a separate agreement that was amended in May 2023, J.D. Heiskell also purchases all of our ethanol, WDG, corn oil, and CDS and sells them to marketing companies designated by us. We have designated Murex to purchase and market ethanol and A.L. Gilbert to purchase and market WDG and corn oil. Our relationships with J.D. Heiskell, Murex, and A.L. Gilbert are well established, and we believe that the relationships are beneficial to all parties involved in utilizing the distribution logistics, reaching a widespread customer base, managing inventory, and providing working capital relationships. 

The following table summarizes the J.D. Heiskell purchase and sales activity during the three and six months ended June 30, 2026 and 2025:

The agreements with J.D. Heiskell, Murex, and A.L. Gilbert include marketing and transportation services. For the three months ended  June 30, 2026 and 2025, we expensed marketing costs of $0.7 million and $0.6 million, respectively, in connection with the marketing arrangements and these costs are included in Selling, General and Administrative Expenses. For the six months ended  June 30, 2026 and 2025, we expensed marketing costs of $1.3 million and $1.2 million, respectively. For the three months ended  June 30, 2026, we expensed transportation costs of $1.2 million related to sales of ethanol and $1.5 million related to sales of WDG. For the six months ended  June 30, 2026, we expensed $2.2 million related to sales of ethanol and $2.8 million related to sales of WDG. For the three months ended June 30, 2025, we expensed $1.1 million related to sales of ethanol and $1.3 million related to sales of WDG. For the six months ended June 30, 2025, we expensed $2.3 million related to sales of ethanol and $2.7 million related to sales of WDG. Transportation costs are included in costs of goods sold.

Supply Trade Agreement. On July 1, 2022, UBPL entered into an operating agreement with Gemini Edibles and Fats India Private Limited (“Gemini”) pursuant to which Gemini supplies UBPL with feedstock up to a credit limit of $12.7 million and has a collateral interest in inventories, current assets, and fixed assets of UBPL. If UBPL fails to pay an invoice within the ten-day credit period, the outstanding balance bears interest at 18%. The agreement is effective through July 2026. As of each  June 30, 2026 and  December 31, 2025, UBPL had $0 outstanding under this agreement.

Forward Sale Commitments. As of  June 30, 2026, we have no forward sale commitments.

Natural Gas Purchase Agreement. As of  June 30, 2026, we have a forward purchase agreement in place to buy approximately 3,700 MMBtu ("million British thermal units") of natural gas per day for use at the Keyes plant at fixed prices between $1.55 and $3.175 per MMBtu through September 2026. We have elected to apply the normal purchases and normal sales scope exception under ASC 815 "Derivatives and Hedging," hence the natural gas purchased under this agreement is accounted for and included as cost of goods sold in our financial statements.