AMAYA TREE ESTATE: MANAGED FOREST INVESTMENT OPPORTUNITY Synergy Partners Uganda

About Synergy Partners Synergy Partners is a real estate development company headquartered at Kisozi Complex, Plot 6 Kyaggwe road, Nakasero. In addition, the firm has a show house at Birungi Estate, Kira. The firm has steadily become one of the leading land developers in Uganda. Our niche is affordable housing communities, and managed agriculture estates. Our competitive advantage is passion, integrity, and hard work. Residential portfolio: Kira (Birungi Estate) Gayaza (Naava & Sanyu Estates) Matugga (Malaika Estate) Managed agriculture estates: Nakasongola (Amaya Tree Estate) Find out more: www.synergypartners.co.ug sales@synergypartners.co.ug 0751 523 327 Synergy Partners Uganda

A case to reforest Uganda Uganda is a fertile, beautiful country aptly known as the “Pearl of Africa.” One would think it is adequately forested. However, upon deeper investigation, it is apparent that that is not entirely the case. Deforestation remains a major concern, with 80% of Uganda’s 35 million population presently living in rural areas and greatly dependant (approximately 90%) on fuel wood for their energy needs. The country’s population growth is currently estimated at 3.4% per annum which is expected to double within the next 20 years. Human encroachment on forests is one of Uganda’s main environmental concerns, extending to even the Protected Areas (Central Forest Reserves and National Parks). Total forestry cover in Uganda is currently approximately 11% of the entire landholding. As a comparable, in 1990, forests covered 20.4 percent of the land area of the country. From 2010 to 2014, a total of 39m, 41m, 42m and 44m tones of round wood were produced in Uganda. This is an indicator of the growing need for wood and timber in the country. The aforementioned decline in Uganda’s forestry is correlated with the increased cultivation and sale of round wood in the country indicating the growing demand for timber with limited or dwindling supplies. Synergy Partners Uganda

Introducing Amaya Tree Estate Located approximately 160 km away from Kampala (1 hour and 30 minute drive), on the Gulu highway in Nakasongola district, Synergy Partners located the perfect location for this new venture. The project site begins right from the tarmac road, a key logistics advantage. About Nakasongola Population: 440,000 Ethnicity: Baganda, Baruli, Banyarwanda Main occupation: Cattle Keeping/Ranching; commercial forestry Key tourist attractions: Zziwa Rhino Sanctuary, Nakasongola Hills Others: UPDF Airforce base and Heavy Artillery Unit Synergy Partners has undertaken a commercial tree planting project, Amaya Tree Estate, on an initial 680 acres (1 square mile) of land in Nakitoma, Nakasongola district. The project will eventually be expanded to cover an additional 2,040 acres (3 square miles), making the total 4 square miles. Amaya Tree Estate, an investment product, provides a nexus between environmental conservation and economic development. According to our research, Pine is the most feasible commercial tree to grow on Amaya Tree Estate. Pine takes approximately 15 years to fully mature to a viable tree diameter. Synergy Partners Uganda

Key features of project Description Comments Type of asset Managed forest estate Types of trees Pine (PCH) How many years to full maturity? Pine will take typically take 15 years and above. The older the tree, the more cubic mass it will have. Location Nakitoma, Nakasongola District. Size of land Initial 680 acres, divided in chunks of 5 and 10 acres each. Additional 2,040 acres to be developed. Licenses The company expects to eventually obtain relevant licenses from the Ministry of Water & Environment to facilitate harvesting. Purchase of land 5 acre plot – 16.0 million 10 acre plot – 30.0 million   Additional investment requirement Year 1: establishment costs (one off) 5 acre plot – 4.85 million 10 acre plot – 8.2 million Year 1 – 15: annual maintenance costs 5 acre plot – 2.4 million per year (36 million over 10 years) 10 acre plot – 4.4 million per year (66 million over 10 years) Estimated profit (One off harvest) 5 acre plot – 318 million 10 acre plot – 645 million Synergy Partners Uganda

Key risks to consider for the investment Political and economic risks – Uganda is a developing country; risks like foreign exchange fluctuation and land tenure challenges should be considered. Diseases Fire Damage from stray animals We recommend that customers insure their investment by taking adequate political and crop insurance cover with leading insurance companies. Synergy Partners Uganda

Synergy Partners as a forestry partner After purchasing the forestry plot, Synergy Partners undertakes the following activities for reasonable fees: land preparation/bush clearing Planting weed control forest fire protection pests and diseases control monitoring/ management of plantation growth crop insurance General plantation security Customer reporting and harvesting The company’s senior management team includes a professional forester/agronomist to provide appropriate advisory and execution expertise. Synergy Partners Uganda

Synergy Partners Uganda Why invest? a) Retirement savings b) Children’s college/university fund c) Contribution towards a greener earth e) Varied long term investment goals Synergy Partners Uganda

Synergy Partners Uganda Projections This section presents an insight into the business model and key figures of interest for purposes of understanding the opportunity and decision making. Synergy partners is offering two investment options at Amaya Tree Estate: Option 1: Purchase of 5 acres of land Option 2: Purchase of 10 acres of land Some key areas of interest to you are: - Start up costs Expenses on overheads and maintenance costs of managed forest Sales returns as Gross and Margin Cash-flows and Return on Investment Tax deductions per enterprise - These have been left out on basis of per investor payments and terms and conditions – Figures presented are exclusive of tax Synergy Partners Uganda

Option 1 (5 Acre Pine Investment) Option 2 (10 Acre Pine Investment) Projections A: Profit Forecasts (15 Year Period) Option 1 (5 Acre Pine Investment) Option 2 (10 Acre Pine Investment)   UGX Total Revenue 375,000,000 750,000,000 Land (16,000,000) (30,000,000) Plantation establishment (4,850,000) (8,200,000) Overhead expenses and Maintenance Costs (36,000,000) (66,000,000) Total investment (56,850,000) (104,200,000) Profit 318,150,000 645,800,000 Synergy Partners Uganda

Synergy Partners Uganda 5 acres Vs 10 acres Synergy Partners Uganda

Option 1 (5 Acre Pine Investment) Option 2 (10 Acre Pine Investment) Key figures D:Profit and Costs per acre and tree Option 1 (5 Acre Pine Investment) Option 2 (10 Acre Pine Investment) Total trees per acre 300 Number of acres 5 10 Start-up costs per acre (UGX) 4,170,000 3,820,000 Production costs per acre (UGX) 7,200,000 6,600,000 Start-up cost per tree (UGX) 13,893 12,727 Production cost per tree (UGX) 23,988 21,899 Net profit per acre (UGX) 44,541,000 45,206,000 Net profit per tree (UGX) 148,470 150,687 Synergy Partners Uganda

Synergy Partners Uganda Return on investment A: Return on Investment (R.O.I) UGX Start-up cost (A) 20,850,000 38,200,000 Additional investment total (B) 36,000,000 66,000,000 Average profit (C) 14,847,000 30,137,333 Return on investment (C/(A+B)) 27% 30% B. Internal Rate of Return (I.R.R) 13% 17% Synergy Partners Uganda