Risk Disclosure

Risk Disclosure

Draft for legal review. This document describes the Mahsool platform accurately, but it has not yet been reviewed by counsel and the operating entity's details are pending.

Subscribing through Mahsool means becoming a shareholder in a private Egyptian company whose only asset is a parcel of farmland. That is a real business with real seasons, and it can lose money. Read this before you subscribe.

1. You can lose money, including all of it

Every figure shown on a project — expected return, target IRR, projected distributions — is a target based on the farming plan, not a promise. Mahsool does not guarantee returns, does not guarantee your capital, and this is not a deposit account. A project can return less than projected, nothing at all, or less than you put in.

There is no capital protection of any kind. The paragraphs below set out the specific ways money is lost, because "you may lose your investment" on its own tells you nothing useful.

2. Most of what you subscribe is spent, not stored

Only part of the money buys land. The rest pays for reclamation, wells, irrigation, planting, inputs, wages and working capital. That money is consumed by the farming operation — it is in the ground and in the season. If the project fails after a year or two, it is gone, whatever the land is still worth.

3. The land may be paid for in instalments, and can be lost if they stop

Where the company buys land on a payment plan, an unpaid balance is owed to the seller or the allocating authority. Egyptian instalment sale contracts commonly allow the seller to take the land back if payments stop. A bad season, a cost overrun or exhausted working capital can therefore end with the company having paid its deposit, spent its development money, and owning nothing. This is the single most likely route to a total loss.

Each project states what the company owns during the payment period — registered title, title subject to a lien, or a contractual right pending final payment — and that is not the same thing in each case. Read it.

4. Water can fail without the title being affected

Productive value depends on the water allocation (المقنن المائي) and on the wells actually working. A reduced allocation, a failed well or rising salinity can collapse what the land produces while the ownership documents remain perfectly intact. In desert and reclamation areas this is a real risk, not a theoretical one.

5. Title and transfer risk

Land bought from a private seller carries the risk that the seller's own title is defective, encumbered, or subject to restrictions — in particular, land originally allocated by the state may not be transferable without the allocating authority's consent. Mahsool verifies this before publishing a project, and verification reduces this risk without removing it. A successful challenge to the company's title could mean the loss of the asset.

6. Agriculture carries risks that no plan removes

• Weather and climate — heat waves, unseasonal cold, wind and flooding can reduce or destroy a crop.
• Pests and disease — infestations and plant disease can cut yield sharply, sometimes across a whole region.
• Inputs — fertiliser, fuel, seed and labour costs can rise faster than the plan assumed.
• Market prices — a good harvest sold into a fallen market still returns less than projected. Export-grade crops carry additional exposure to demand, logistics and border conditions.
• Timing — harvests slip. A late season delays distributions.

7. Your shares are illiquid. There is no market and no redemption

You are buying shares in an unlisted private company. They are not traded on any exchange. The company will not buy them back and neither will Mahsool. There is no redemption on demand and no guaranteed exit.

You can only sell if you find a buyer yourself, and any transfer is subject to the other shareholders' pre-emption rights and to the board's approval. Assume your money is committed for the life of the project. A holder who needs to exit and cannot find a buyer has, in practice, lost access to their capital even if the company is perfectly solvent.

8. You are relying on Mahsool to manage the farm

Mahsool manages the reclamation and the season under a contract with the company's board. Mismanagement, underperformance, dispute or the failure of Mahsool itself can reduce or end a project's returns. The management contract runs for an initial term during which Mahsool can be removed only for cause.

9. What you own — and what you do not

You own shares in a company that owns the land. Those shares carry the rights an Egyptian joint stock company confers: a proportional claim on dividends the company declares and on its assets on winding up, a vote at general meetings, and a say in electing the board.

You do not own a demarcated piece of ground. The company owns the parcel as a single undivided asset. You cannot occupy it, farm it, fence off a portion, or demand that it be divided. A holding described as "four feddans' worth" is a way of expressing the size of your stake, not a plot you can stand on.

10. Capital calls are an obligation

Where a subscription is paid in stages, the remaining amounts are sums you have committed to pay on a schedule set by the company. Missing one has consequences set out in your subscription documents. Persistent default can affect your shareholding.

11. Other shareholders, and concentration of control

The company's documents do not cap any shareholder's stake. Mahsool applies a limit when shares are first issued, but shares can move afterwards by transfer or inheritance, and another holder may over time come to hold a large position and influence decisions that affect you.

Separately: each company owns one parcel, one location, one set of crops. That is concentrated by design. Spreading across several projects reduces — but does not eliminate — that exposure.

12. Fees reduce your return

Every project states its fees before you sign. Mahsool's fees are invoiced to the project company for sourcing, formation, management and crop marketing, and they reduce what the company has available to distribute. Your net return is lower than the headline figure.

13. Currency and economic conditions

Amounts are in Egyptian pounds. Inflation, interest rates, currency movements and changes in agricultural or export policy affect both project economics and the real value of what you receive.

14. Regulatory status — this is not a regulated product

Mahsool is not licensed by the Financial Regulatory Authority. This is not a fund, not a regulated investment product, and not supervised by any financial regulator. There is no investor compensation scheme, no regulatory protection and no ombudsman standing behind it.

What you are doing is subscribing for shares in a private Egyptian company — an ordinary transaction requiring no licence. But it also means the protections that attach to licensed investment products do not attach here.

Regulatory change could affect how this model operates in future. If the Authority were to determine that any part of it requires a licence, the platform's activity could be restricted or suspended while that is resolved.

15. Platform and operational risk

Technology carries its own risks: outages, degraded service and security incidents are possible. Mahsool holds no client money — your funds move from your bank to the project company's account — but records, reporting and access can still be disrupted.

16. Only invest what you can afford to lose

This is not suitable for money you will need soon, for emergency savings, or as a substitute for a bank deposit. Before subscribing, consider whether you could carry a total loss of the amount without it changing your circumstances, and seek independent advice if you are unsure.

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Questions about a specific project's risks belong on that project's page and with our support team before you commit, not after.