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12. Agreements

3 Months Ended

Mar. 31, 2013

Working Capital Arrangement. In March 2011, we entered into a Corn Procurement and Working Capital Agreement with J.D. Heiskell. Pursuant to the agreement we agreed to procure whole yellow corn from J.D. Heiskell. We have the ability to obtain corn from other sources subject to certain conditions, however, in 2012, all of our corn requirements were purchased from Heiskell. Title and risk of loss for the corn passes to us when the corn is deposited into the weigh bin. The initial term of the Agreement expired on December 31, 2012 and is automatically renewed for additional one-year terms, currently to December 31, 2013. Heiskell further agrees to sell all ethanol to Kinergy Marketing or other marketing purchaser designated by the Company and all WDG and syrup to A.L. Gilbert. These agreements are ordinary purchase and sale agency agreements for an ethanol plant.

The J.D. Heiskell Purchasing Agreement, Corn Procurement, Working Capital Agreement activity during the three months ending March 31, 2013 and 2012 follow:

	Three months ending March 31, 2013		Three months ending March 31, 2012
Ethanol sales	$	5,497,187	$	32,053,209
Wet distiller's grains sales		1,683,785		7,831,741
Corn oil sales		175,043		—
Corn purchases		5,374,318		36,784,805
Accounts receivable		—		824,881

Ethanol and Wet Distillers Grains Marketing Arrangement. The Company entered into an Ethanol Marketing Agreement with Kinergy Marketing and a Wet Distillers Grains marketing agreement with A. L Gilbert. Under the terms of the agreements, subject to certain conditions, the agreements mature on August 31, 2013 with automatic one-year renewals thereafter. For the quarter ended March 31, 2013 and 2012, the Company in total expensed $123,998 and $542,464, respectively, under the terms of both ethanol and wet distillers grains agreements.