This niche sus­tain­able agro strat­e­gy seeks above infla­tion cash returns, by lever­ag­ing the estab­lished and grow­ing Brazil nut mar­ket. The approx­i­mate 50% spread between raw nut pur­chase price (from har­vesters in the Ama­zon) and sale to whole­sale dis­tri­b­u­tion offers good yield with low down­side risks.

A glob­al leader in the pro­duc­tion of Brazil nuts will act as the Pro­gram Man­ag­er, sourc­ing, pro­duc­ing and sell­ing the prod­uct to the mar­ket with state-of-art facil­i­ties and sales network.

The ePP­Ns rep­re­sent frac­tion­al ben­e­fi­cial inter­est in exist­ing, pur­chased raw Brazil nuts, and an oblig­a­tion of the Pro­gram Man­ag­er to process and dis­trib­ute the final prod­uct. The stan­dard quan­ti­ties sold are 16,000 kg of the final prod­uct, which rep­re­sent one ship­ping container.

Cash­flows are gen­er­at­ed by sale to whole­sale dis­tri­b­u­tion, where prof­it is shared between Pro­gram Man­ag­er and ePPN hold­ers on a quar­ter­ly basis.

The pro­ceeds from the issuance of the Notes will be used to pur­chase raw Brazil nuts from WHITE LION FOODS PTE. LTD., which ulti­mate­ly will enti­tle the Issuer to the own­er­ship of Brazil nuts and a share in the pro­ceeds from sale of the nuts after processing.

Issuer will use the pro­ceeds of the Notes to pur­chase month­ly dur­ing the har­vest sea­son allo­ca­tion up to 70% of Brazil nuts pur­chased from farm­ers by WHITE LION FOODS PTE. LTD. (“WLF”) incor­po­rat­ed and reg­is­tered in Sin­ga­pore with reg­is­tra­tion num­ber 201220949G, hav­ing its reg­is­tered office is at 1 George Street #16–01, Sin­ga­pore (049145).

The raw Brazil nuts, pre­vi­ous­ly acquired on behalf of WLF by their sub­sidiary, White Lion Nuts SAC (incor­po­rat­ed in Peru) , direct­ly from har­vesters in the Ama­zon rain­for­est, will be processed into a fixed num­ber of ship­ping con­tain­ers of processed Brazil nuts.

The Pro­gram Man­ag­er is respon­si­ble for all costs asso­ci­at­ed with the devel­op­ment, dis­tri­b­u­tion, and sale of the assets from their share of the prof­its. Investors’ returns are ring-fenced from all oth­er expense and lia­bil­i­ties in WLF’s business.

The Advi­sor on behalf of the Issuer gen­er­al­ly over­sees the Pro­gram Man­ag­er and the Pro­gram Manager’s prin­ci­pal ser­vice providers, but does not exer­cise day-to-day over­sight of the Pro­gram Man­ag­er nor such ser­vice providers.

Brazil nuts are har­vest­ed sea­son­al­ly, but pur­chased through­out the year. In addi­tion to being a food, the nuts have wide appli­ca­tions across cos­met­ics and hygiene (sham­poos, con­di­tion­ers, soaps, skin-care prod­ucts, etc…).

Due to the wide range of appli­ca­tions, the Brazil nut mar­ket has been con­sis­tent­ly grow­ing for many years.

Net Glob­al Brazil Nut Trade, 2020

White Lion Foods is the glob­al leader in the pro­duc­tion and expor­ta­tion of Brazil nuts. Incor­po­rat­ed in 2012 by British co-founders, Gareth Lloyd and Gre­go­ry Vick­ers, the com­pa­ny has expand­ed from a sin­gle site to 5 pro­duc­tion facil­i­ties in Peru and Brazil deliv­er­ing thou­sands of tons of fresh prod­uct to over 30 coun­tries across the globe.

In 2016, WLF incor­po­rat­ed White Lion Nuts S.A.C. in Tam­bopa­ta — Madre de Dios, Peru, and began acquir­ing land and build­ing a state-of-the-art pro­cess­ing facility.

WLF’s facil­i­ties are strate­gi­cal­ly posi­tioned in Brazil’s, Peru’s, and Bolivia’s Ama­zon region. By bas­ing facil­i­ties in prox­im­i­ty to the source, WLF is able to pro­cure the high­est qual­i­ty and fresh­est raw prod­ucts at the low­est prices — enabling them to deliv­er the high­est qual­i­ty end-prod­uct at a high­ly com­pet­i­tive price, while still main­tain­ing strong margin.

In 2019, WLF had grown to the point where they were pro­duc­ing 129 met­ric tons of Brazil nuts per year, amount­ing to a lit­tle under $1 mil­lion, or about 2.41% mar­ket share. The com­ple­tion of their pri­ma­ry fac­to­ry has enabled them to sig­nif­i­cant­ly increase that, to the point where they are on track to exceed 50% mar­ket share in 2023.

Gareth Lloyd, Gre­go­ry Vick­ers, Amir Khay­at (from left to right)

Brazil Nut ePP­Ns are prof­it-par­tic­i­pat­ing notes, rep­re­sent­ing 100% own­er­ship of the cor­re­spond­ing amount of Brazil nuts, sourced, processed and man­aged by White Lion Foods PTE LTD.

The prof­it is the dif­fer­ence between the aver­age sale price in the month of sale and the aver­age pur­chase price in the month of purchase.

The dis­tri­b­u­tion of prof­its is such that 50% of the prof­it up to 110% of the pur­chase price is attrib­uted equal­ly to the Issuer and the Pro­gram Manager.

If there is any addi­tion­al prof­it, 13% of all addi­tion­al prof­it is retained by the Issuer, and the remain­der is paid to the Pro­gram Manager.

The expect­ed annu­al yield for Brazil Nut ePP­Ns investors on their invest­ment is in the range of 8% — 13% with a quar­ter­ly dis­tri­b­u­tion of prof­its. (see Brazil Nut ePP­Ns Yield Pro­jec­tions doc­u­ment for details)