Company engages in various activities, including leasing land to farmers.
Each crop year, Bank extends crop production loans to local farmers, including farmers who lease land from Company to produce crops. A copy of the lease commitment between Company and the farmer is provided to Bank as part of the loan application. Upon receipt of a loan application, the Bank conducts an independent credit evaluation of each borrower before extending credit. The income from the remaining 25 percent of the crop generally represents the amount of compensation that Company will receive for the lease. A portion of the proceeds of the loan may be used to purchase seed and other items needed in connection with the farming operations.