Alto Ingredients, Inc. Commitments Disclosure
| 15. | COMMITMENTS AND CONTINGENCIES. |
Commitments – The following is a description of significant commitments at December 31, 2025:
Sales Commitments – At December 31, 2025, the Company had entered into sales contracts with its major customers to sell certain quantities of alcohol and essential ingredients. The Company had open alcohol indexed-price contracts for 90,270,100 gallons as of December 31, 2025 and open fixed-price alcohol sales contracts totaling $218,045,300 as of December 31, 2025. The Company had open fixed-price sales contracts for essential ingredients totaling $6,123,200 and open indexed-price sales contracts for essential ingredients for 7,800 tons as of December 31, 2025. These sales contracts are scheduled for completion over the next twelve months.
Purchase Commitments – At December 31, 2025, the Company had indexed-price purchase contracts to purchase 20,796,700 gallons of alcohol and fixed-price purchase contracts to purchase $2,900 of alcohol from its suppliers. The Company had fixed-price purchase contracts to purchase $26,245,600 of corn from its suppliers as of December 31, 2025. The Company had indexed-price purchase contracts for 3,140,000 MMBTU of natural gas. The Company had future commitments for certain capital projects totaling $17,530,000. These purchase commitments are scheduled to be satisfied over the next twelve months.
Contingencies – The following is a description of significant contingencies at December 31, 2025:
Litigation – The Company is subject to various claims and contingencies in the ordinary course of its business, including those related to litigation, business transactions, environmental matters, employee-related matters, and others. When the Company is aware of a claim or potential claim, it assesses the likelihood of any loss or exposure. If it is probable that a loss will result and the amount of the loss can be reasonably estimated, the Company will record a liability for the loss. If the loss is not probable or the amount of the loss cannot be reasonably estimated, the Company discloses the claim if the likelihood of a potential loss is reasonably possible, and the amount involved could be material. While the Company can provide no assurances, the Company does not expect that any of its pending legal proceedings will have a material financial impact on the Company’s operating results.
Historical Timeline
| Fiscal Year | Filed | |
|---|---|---|
| 2025 | Mar 13, 2026 | Showing above |
| 2024 | Mar 13, 2025 | |
| 2023 | Mar 14, 2024 | |
| 2022 | Mar 14, 2023 | |
| 2021 | Mar 15, 2022 | |
| 2020 | Mar 26, 2021 | |
| 2019 | Mar 30, 2020 | |
| 2018 | Mar 18, 2019 | |
| 2017 | Mar 15, 2018 | |
| 2016 | Mar 15, 2017 | |
About Commitments Disclosures
Commitments and contingencies disclosures catalog a company's off-balance-sheet obligations and legal exposures — purchase commitments, guarantee arrangements, pending litigation, and regulatory proceedings. These items represent potential future cash outflows that may not appear as liabilities on the balance sheet until they become probable and estimable.
Key signals: litigation reserves and disclosed loss ranges quantify management's estimate of legal exposure, but unquantified "reasonably possible" losses often represent the larger risk. Watch for changes in language around pending cases — shifts from "remote" to "reasonably possible" or increases in estimated loss ranges signal deteriorating outcomes. Unconditional purchase obligations and take-or-pay contracts create fixed cost structures that reduce operational flexibility. Guarantee arrangements for subsidiaries or joint ventures can create cascading obligations. Compare the total commitment schedule against projected free cash flow to assess whether the company can meet its obligations without additional financing.