please answer these questions below:

1. Type of Operation - How does the business generate income?
2. Size of Operation - What is the size of the operation? (Depending on the business this may be expressed in terms of production/throughput levels, asset size, market share, # of acres, or # of cows. How does this compare to peers?)
3. Marketing strategy How and to whom is the product sold? Is there any reliance on key suppliers or off-takers?
4. Ownership structure Who owns the Company?
5. Business strategy Describe the plan for the operation on a go-forward basis. Are there or will there be any changes to the business? Examples include expansion plan, new or shift in products, relocations, asset sales/purchases, etc.
6. Management Team - Briefly summarize the owners and key managers and their relevant experience. Is the business dependent on only a few key individuals?
7. Industry Analysis - Describe the industry that the borrower operates in. State the near term and long term outlooks. Is the industry mature, stable, growing, or declining?
8. Requests: Provide a summary of the loan(s) requested. For each loan include the following:
   1. State the request
   2. State the purpose of request/use of funds

Rabo AgriFinance Case Study www Terra Farms, LLC Instructions: Using the information provided, complete the Credit Application for Terra Farms. Draw conclusions about the Company's financial position, the collateral, and the risks of the deal; decide if you will give the customer the loans it has requested, and whether the loans will be in the amounts requested, more, or less; determine key structural elements (term, amortization, payment details, guarantors, subject to conditions, reporting requirements, covenants, etc., as deemed necessary); and finally provide a recommendation. Your recommendation should provide narrative on the deal, point out key risks, including why the risks are acceptable to the Bank, and address the rationale behind the loan amounts and structural elements recommended. Your recommendation will be presented to a Credit Committee made up of banking professionals. Request: The borrower requests one-year renewal of their $1,000,000 operating line currently held by RAF (current maturity of 12/31/2019) as well as additional financing of $200,000 to support the purchase of a new Tree Shaker Tractor to replace outdated equipment. To support its request, Terra Farms has provided the information listed below Background and Management Overview, including analysis of the industry Four years of Company Prepared financial statements 2020 Budget Personal Financial Statements for Clark and Melanie Terra Business Background: Terra Farms, LLC was created in 2010 between husband and wife team, Clark and Melanie Terra. At origination, the company leased approximately 250 acres of bare-ground located in Fresno County from third party, Curran Lion Holdings, Inc. In early 2011, Terra Farms planted the irrigated ground (243 acres) to almonds. In 2015, the opportunity arose to purchase the property from the prior landlord for approximately $4.86mln. The company financed this with RAF (Rabo Agrinance) via a 20-year amortized term loan at 65% loan-to-value guaranteed by Clark & Melanie Borrower has communicated to the Bank that through 8/31/2019, the operation remains profitable and is expected to exceed projections due to favorable weather conditions. Management Team: Day to day operations are overseen by Clark, who has managed the operating entity since inception. Prior to origination of Terra Farms, Clark managed his family's 500 acre almond wwwwwwwVw operation for 25+ years. Industry Analysis: In early 2018, California experienced freezing temperatures and rains (including several hail storms) later in the year than what is considered normal. This caused frost and hail damage to the almond crop, which impacted yields and the overall crop quality Although the official 2018 United States Department of Agriculture (USDA) California almond crop estimate was set at 2.45 billion pounds, actual crop came in closer to 2.30 billion pounds, on an estimated 1.07 million bearing acres. 2019 Almond Update: The marketable crop in the 2018/19 season is estimated to be up about 4% YoY, while carry-in was 10 % lower. Total available US almond supplies were up 2% YoY this marketing year. Through December 2018, 39% of total US supply was sold (vs 41% and 38% in the previous two seasons) Global almond demand continues to be driven by a powerful combination of taste, convenience and healthfulness coupled with continued rising incomes in developing countries, which drive changes in eating habits. Terra Farms, LLC Balance Sheets As of December 31st 2016 2017 2015 2018 ASSETS Current Assets Cash 695,089 1,070,742 1,223,067 1,414,523 Accounts receivable - trade 950,000 680,372 815,733 608,642 Less bad debt reserve -55,000 -55,000 -55,000 -55,000 Cash invested in growing crops 13,251 13,922 13,516 14,618 Prepaids 2,750 2,500 2,550 2,650 1,605,840 1,847,541 1,865,011 1,985,533 Property, Plant, & Equipment Land 4,860,000 4,860,000 4,860,000 4,860,000 Machinery & equipment 356,850 356,850 405,590 405,590 Other fixed assets 23,500 23,500 23,500 23,500 Less: accumulated depreciation -340,873 -398,814 -231,953 -282,931 4,948,218 5,008,398 4,957,419 4,890,276 Other Assets 1,521 1,456 1,473 1,497 Total Assets 6,814,725 6,877,330 6,615,694 6,806,433 MEMERS EQUITY Current Liabilities Operating line of credit Accounts payable - trade 170,000 155,000 165,000 280,000 51,796 52,040 53,461 54,935 Accrued expenses 60,987 56,590 59,685 63,747 Current maturies of long-term debt 157,950 157,950 157,950 157,950 553,872 421,336 439,674 440,158 Long-term Debt Notes payable 2,645,663 2,961,563 2,803,613 2,487,713 Members' Equity Retained earnings 2,789,500 3,232,794 3,563,145 3,728,904 Distributions -200,000 -450,000 -95,000 O Net Income 893,294 530,351 260,759 106,841 3,728,904 3,232,794 3,563,145 3,835,745 Total Liabilities & Members' Equity 6,814,725 6,877,330 6,615,694 6,806,433 Terra Farms, LLC Statements of Income For the Years Ended December 31st 2016 2015 2017 2018 Total Crop Acres Yields/Acre 243 243 243 243 1,900 1,950 2,130 1,800 Sales 1,237,040 1,846,800 1,483,151 1,106,622 Cost of Sales Growing costs 527,126 532,456 545,549 562,422 105,950 Harvest costs 103,061 100,695 104,891 630,187 633,151 650,440 668,372 Gross Profit 1,216,613 438,250 849,999 586,600 Operating Expenses Depreciation 50,979 50,979 57,941 57,941 General and administrative 127,167 122,580 121,366 125,768 Interest 149,463 146,240 139,797 144,689 Other 3,098 525 1,862 2,501 323,546 320,447 326,605 332,299 Operating Profit 529,553 893,066 259,996 105,951 Other Income (Loss) Miscellaneous -1,028 -1,598 -1,563 -1,690 1,028 1,598 1,563 1,690 Profit Before Income Taxes 894,094 531,151 261,559 107,641 Income Tax Expense 800 800 800 800 Net Income 893,294 530,351 260,759 106,841 2020 Budget Crop Almonds Acreage Yield 243 2,200 Price 2.95 Share 100% Total Income 1,577,070 Total Feb March May July Nov Beyond Jan pr June Aug Sep Oct Dec Current Year Receipts $1,577,070 $40,000 $400,000 $450,000 $687,070 Expenses Pre-Harvest Cost/Acre $613.17 $149,000 Labor $6,000 $6,000 $6,000 $10,000o $15,000 $15,000 $15,000 $19,000 $25,000 $19,000 $6,500 $6,500 Payroll $2,000 $3,700 $3,700 $125.93 $30,600 $2,000 $2,00o $3,700 $2,500 $2,500 $2,500 $2,000 $2,000 $2,000 $48,000 Custom $197.53 $15,000 $18,000 $15,000 Fertilizer $316.87 $77,000 $45,000 $32,000 Chemical $37.73 $83,000 $13,000 $30,000 $15,000 $10,000 $15,000 Gas/Fuel/Oil Repairs Supplies $29,400 $900 $120.99 $900 $900 $1,200 $1,200 $2,200 $3,000 $4,500 $8,000 $4,500 $1,200 $900 $1,800 $19.75 $4,800 $1,000 $1,000 $1,000 $36.63 $8,900 $750 $750 $750 $900 $750 $2,000 $500 $500 $500 $500 $500 $500 $10,000 $93,600 $27,600 $41.15 $10,000 Insurance Utilities $385.19 $800 $3,000 $3,200 $8,000 $12,000 $18,500 $18,500 $12,000 $3,200 $8,000 $3,200 $3,200 $113.58 $2,300 $2,300 $2,300 $2,300 $2,300 $2,300 $2,300 $2,300 $2,300 $2,300 $2,300 $2,300 Management Miscellaneous $1,502.06 $365,000 $200,000 $15,000 $150,000 Pollination $609.05 $148,000 $148,000 Total Pre-Harvest $1,074,900 Harvest Expenses $98,500 $405.35 $98,500 Total Harvest $98,500 Clark & Melanie Terra Personal Financial Statement 3/30/2019 Assets Cash in Bank 1,429,173 Retirement Account 947,033 Investments Terra Farms LLC 4,411,107 Real Estate Personal residence 575,000 Home Ranch, 1,500 acres 11,250,000 Total Assets 18,612,313 Liabilities Credit cards 0 Mortgage 199,421 Home Ranch loan 4,473,134 Total Liabilities 4,672,555 Net Worth 13,939,758