IFACC 2023 Market Report

Closing date: January 2023 Disbursed amount: R$ 17 MM (equivalent to US$ 3.5 MM) Partners: Conesxus, Belterra, Grupo Gaia and Santander Overview: Green innovative CRA for five Brazilian biomes, with a strong focus on Amazon local communities, fostering a wide range of economic activities that support the standing forests, regeneration of degraded land, and sustainable production, such as agroforestry systems of cocoa, banana, cupuaçu, pupunha, and cassava, among other species. Structure and terms: Issuance of a CRA with unprecedented terms to boost businesses linked to the bioeconomy in the North and Northeast regions of Brazil, fostering agroforestry systems, restoration of degraded areas, and supporting cooperatives that make sustainable use of natural resources. Grupo Gaia was the issuer of the bond, and Santander the coordinator of the transaction, the proceeds were channeled to 22 community cooperatives connected to Conexsus and to Belterra, a startup specialized in developing agroforestry systems. To reduce investor risk and provide reduced rates to the cooperatives, the issuance was divided into three quotas: senior, mezzanine, and subordinated – with those in the latter category being acquired by Conexsus and Belterra, using concessional resources from the Fund Vale and the Good Energies Foundation. Maturity dates and rates ranged from 3.3% to 15.75% per year (CDI + 2.1% rates in reais). This structure made it possible to transfer credit with interest of 12% p.a. to producers, who, for the most part, face difficulties in raising working capital and scaling up their activities. Expected impact: Green CRA will finance working capital for 22 community businesses and four small and medium-sized impact companies, benefiting 4,500 producers without access to traditional credit lines. The investment will benefit businesses in 5 biomes in Brazil, with a strong presence in the Amazon. Scale opportunities: Initial investment can be expanded in future issuing considering the potential of other communities and non-timber forest products.9. CONEXSUS, BELTERRA, GRUPO GAIA AND SANTANDER GREEN CRA © Gaiaamazon ifacc 2023 USD 3.5 MM 31 IFACC 2023 MARKET REPORT