The Company’s controlling shareholder is Guilherme Augusto Frering, the balance of shares is owned by management and board members. The Company’s team of seasoned forestry and management professionals is led by its Executive Director, Mr. Gilberto Francischetto, who is a forestry engineer with more than 30 years of experience.

Managing the plantations through maturity requires an investment of about US$40 million. IFC has been asked to extend a long-term loan of up to $22 million to the Company for IFC’s own account.

22.0 million (USD)

Product Line	IFC Investment (million USD)
Risk Management
Guarantee
Loan	22.0
Equity

* These investment figures are indicative

The Project is located in the Midwest region of Brazil, in the state of Mato Grosso, Brazil’s third largest state. The closest town to the Project is Agua Boa, located near the border to the state of Goias and about 650 km north east of Cuiaba, the state capital of Mato Grosso. CVA’s administrative offices are located in Rio de Janeiro.

Climate change mitigation:
Tree growth and addition of significant soil carbon will sequester nearly 100,000t CO2e p.a. Plantations have a positive impact on surface water balance and improve the region''s drying microclimate. The sale of "non-commercial" thinnings and waste wood processing from processing to local agro-processing facilities substitutes for biomass partly derived from the clearing of native forest and vegetation.

ii. Local economic diversification:
The Company is in a region where local economic well-being is very dependent on cattle grazing and the cultivation of soy and corn. The Project contributes to reducing the local economy''s over dependence on too narrow a range of commodities and broadens the skill base of the labor market.

iii. Employment generation:
Cattle grazing, soy and corn cultivation generate fewer jobs per hectare than plantation forestry. Moreover, the Company operates within the formal sector with respect to its employment practices. As such, the Project makes a contribution to generation of year-round jobs and does so in the formal sector.

iv. Re-socialization of prisoners:
Through Fundação "Nova Chance" (translated as Fresh Start), a convict rehabilitative program sponsored by the Mato Grosso government, CVA has been employing inmates since the latter part of 2013. The goal of Nova Chance is to break the cycle by which former convicts have a very high rate at which they return to crime after prison and, ultimately, are imprisoned again. Most of the prisoners are from economically disadvantaged backgrounds such that - for example - they may not have formal sector work experience or bank accounts. The program helps prepare them for life after incarceration by establishing and funding a bank account in their name with a cushion of savings following their release and provides recent work experience.

i. Long-term finance:
Due to the long-dated nature of the Project and that it is executed by a medium-sized enterprise, it is not easy for commercial lenders to provide a loan that is suited to the Project, allowing IFC to play a critical role in bridging to CVA''s bankability. IFC will provide tailor-made, flexible, long-term financing which is not readily available in the market.

ii. Indication of investment appropriateness for future investors:
IFC will be the first lender to CVA after the Brazilian development bank. While the Company is operating to good standards with respect to areas future investors will look at (e.g. corporate governance, environmental and social sustainability), IFC''s presence as a partner and lender can be expected over the long-term to ease access the Company''s access to debt or equity funding.

iii. Environmental and social (E&S) best practices:
IFC developed an environmental and social action plan (ESAP) aimed at reinforcing the Company''s plans to continually improve its practices, including certification and better handling of chemicals.

This is a Category B project in accordance to IFC’s Policy on Social and Environmental Sustainability. The S&E risks and impacts associated with the teak plantations in this part of Brazil can be prevented or mitigated through the combined use of a proactive environmental and social management systems, careful screening of land acquisitions to reduce risks to biodiversity and indigenous people, and application of well-established EHS safeguards. Environmental and social issues reviewed during appraisal included: Status of the company’s environmental and social risk management and compatibility with independent certification schemes;Occupational Health and Safety (OHS) practices of the Company;Conservation of natural and critical habitats; Ability to prevent and suppress fires; Management of pesticides and other hazardous chemicals.

Please refer to the related Environmental and Social Review Summary (ESRS) document for this project.

Please refer to the Environmental and Social Action Plan (ESAP) tab in the related Environmental and Social Review Summary (ESRS) document for this project.