Green loan

About the farm

The farm has been run since 2009, when the first land lease agreement was signed with an agricultural agency in Poland. The farm has 199ha at the moment, of which 8ha is owned. The farm employs 12 workers. The farm specializes in crop production and pig breeding. The sowing structure consists of 15ha of potatoes, 15ha of onions, 38ha of corn, 42ha of wheat, 45ha of rapeseed and 36ha of grassland. Annual pig breeding on the farm is 10,000 head.

The farm has a number of machines such as:

• CLAAS combine 2016
• HARDI sprayer 2016
• MANITOU front-end loader 2021
• MASCHO GASPARDO spreader 2021
• PICHON manure spreader 2022

FARMA is a group of agricultural producers bringing together farmers. It processes vegetables produced by agricultural producers. It has warehouses for storing vegetables. The next stage of development is to sell vegetables directly to markets to get a higher margin. Wanting to enter into cooperation with markets, it is necessary to pack vegetables in individual packages instead of wholesale, i.e. in bulk. For this purpose, it is necessary to invest in refrigeration units to improve storage conditions for vegetables. The warehouses in our possession are suitable for storing vegetables in winter (they protect from frost), however, in summer they will not protect the raw material from rising temperatures outside. The optimal temperature for long-term storage of vegetables is 4-5 degrees . With refrigeration units, they will be able to store raw material all year round without any loss in quality. Cooperation with markets requires access to raw material of the highest quality throughout the year. Therefore, it is necessary to invest in refrigeration units. The farm is currently in the process of obtaining GlobalGap certification. It is also in the process of applying for cooperation with Dino store chains. One of the next conditions for cooperation is to have the necessary infrastructure that guarantees the delivery of the offered products. Hence the need for the investment. The increase in projected revenues after the implementation of the investment is more than €1.3 million and the profit is about €130,000 per year.

Main Terms

The principal will be repaid by the farmer in regular instalments over the span of 3 years in accordance with the repayment schedule. 199 hectares of land are included in the Green Loan program. It is estimated that a total of 1610 carbon certificates will be generated in 4 years (based on a conservative estimation). Consequently, investors will receive below indicated portion of sales proceeds from every carbon certificate generated from the land of the project owner involved in the program; (1) 60% of income received during the loan period; (2) 40% of income received for the following year after the loan period. It is expected that the first carbon certificates will be generated and sold in the second quarter of 2026. The exact return will depend on the amount of sequestered CO2 levels and the sale price of the carbon certificates. If the project owner (farmer) withdraws from the Carbon Credits Agreement and does not intend to follow the agreement on the carbon revenue split with investors, the project owner will be obliged to repay the entire loan as well as pay the penalty, calculated by multiplying the interest rate by the entire loan amount and period equal to the duration of the loan agreement plus 12 (twelve) months. Investors of this loan would receive a penalty of 116660 EUR * 11,5% * 4 year = 53663,6 EUR. This penalty can be reduced by the return earned by investors from the carbon credits generated If the project fails to be delivered successfully through no fault of the farmer, the farmer commits to paying investors a minimum interest rate of EURIBOR 6M + 1.5%. This commitment applies in situations such as the lack of market demand for selling carbon credits, among others.

Annualized return forecast

Conservative scenario (€20 per carbon certificate): 13,2% IRR* Today's scenario (€35 per carbon certificate): 21,12% IRR* Optimistic scenario (€100 per carbon certificate): 47,44% IRR* Read more about the return scenarios in the document section *The internal rate of return (IRR) is a metric used in financial analysis to estimate the profitability of potential investments. Learn more about it Keep in mind that the return forecast is an estimation and does not guarantee you the returns mentioned above.