0001591670fpi:FarmFourMemberstpr:NE2020-12-31

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

 

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended December 31 2020, 2023

or

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from         to         

Commission file number 001-36405

Graphic

___________________________________________

FARMLAND PARTNERS INC.

(Exact Name of Registrant as Specified in Its Charter)

___________________________________________

Maryland

    

46-3769850

(State or Other Jurisdiction of

Incorporation or Organization)

(IRS Employer

Identification No.)

4600 South Syracuse Street, Suite 1450

Denver, Colorado

80237

(Address of Principal Executive Offices)

(Zip Code)

Registrant’s Telephone Number, Including Area Code (720) 452-3100

Securities registered pursuant to Section 12(b) of the Act:

Title of Each Class

Name Of Each Exchange On Which Registered

Common Stock, $0.01 par value per share

New York Stock Exchange

6.00% Series B Participating Preferred Stock, $0.01 par value per share

New York Stock Exchange

Securities registered pursuant to Section 12(g) of the Act: None

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes No

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Act. Yes No

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes No

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§ 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit such files). Yes No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

Accelerated filer

Non-accelerated filer

Smaller reporting company

Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant has filed a report on and attestation to its management’s assessment of the effectiveness of its internal control over financial reporting under Section 404(b) of the Sarbanes-Oxley Act (15 U.S.C. 7262(b)) by the registered public accounting firm that prepared or issued its audit report.

If securities are registered pursuant to Section 12(b) of the Act, indicate by check mark whether the financial statements of the registrant included in the filing reflect the correction of an error to previously issued financial statements.

Indicate by check mark whether any of those error corrections are restatements that required a recovery analysis of incentive-based compensation received by any of the registrant’s executive officers during the relevant recovery period pursuant to §240.10D-1(b).

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act). Yes No

As of June 30, 2020,2023, the last business day of the registrant’s most recently completed second fiscal quarter, the aggregate market value of the registrant’s common stock held by non-affiliates of the registrant was approximately $202,732,210$536,808,999 based on the closing sales price of $6.85$12.21 per share as reported on the New York Stock Exchange. (For purposes of this calculation all of the registrant’s directors and executive officers are deemed affiliates of the registrant.)

As of March 15, 2021,February 23, 2024, the registrant had 30,727,37148,028,438 shares of common stock (32,207,458(49,231,777 on a fully diluted basis, including 1,480,0871,203,339 Common Units of limited partnership interests in the registrant’s operating partnership) held by non-affiliates of the registrant outstanding for an aggregate market value of $434,485,026 ($455,413,456 on a fully diluted basis) based on the closing sales price of $14.14 on the New York Stock Exchange on March 15, 2021.Operating Partnership) outstanding.

Documents Incorporated by Reference

Portions of the registrant’s Definitive Proxy Statement relating to its 20212024 Annual Meeting of Stockholders are incorporated by reference into Part III of this report. The registrant expects to file its Definitive Proxy Statement with the Securities and Exchange Commission within 120 days after December 31, 2020.2023.

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FARMLAND PARTNERS Inc.

Form 10-K

For the Fiscal Year Ended December 31, 20202023

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PART I

    

Item 1

Business

6

Item 1A

Risk Factors

1516

Item 1B

Unresolved Staff Comments

3839

Item 1C

Cybersecurity Disclosure

39

Item 2

Properties

3841

Item 3

Legal Proceedings

3841

Item 4

Mine Safety Disclosures

3841

PART II

Item 5

Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

3841

Item 6

Selected Financial Data[Reserved]

4144

Item 7

Management’s Discussion and Analysis of Financial Condition and Results of Operations

4245

Item 7A

Quantitative and Qualitative Disclosures About Market Risk

60

Item 8

Financial Statements and Supplementary Data

60

Item 9

Changes and Disagreements with Accountants on Accounting and Financial Disclosure

60

Item 9A

Controls and Procedures

60

Item 9B

Other Information

61

Item 9C

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

61

PART III

Item 10

Directors, Executive Officers and Corporate Governance

61

Item 11

Executive Compensation

61

Item 12

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

61

Item 13

Certain Relationships and Related Transactions, and Director Independence

6261

Item 14

Principal Accountant Fees and Services

62

PART IV

Item 15

Exhibits and Financial Statement Schedules

62

Item 16

Form 10-K Summary

62

Signatures

66

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

We make statements in this Annual Report on Form 10-K that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). These forward-looking statements include, without limitation, statements concerning pending acquisitions and dispositions, projections, predictions, expectations, estimates or forecasts as to our business, financial and operational results, future stock repurchases and other transactions affecting our capitalization, our dividend policy, future economic performance, crop yields and prices and future rental rates for our properties, ongoing litigation, as well as statements of management’s goals and objectives and other similar expressions concerning matters that are not historical facts. When we use the words “may,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” or similar expressions or their negatives, as well as statements in future tense, we intend to identify forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, beliefs and expectations, such forward-looking statements are not predictions of future events or guarantees of future performance, and our actual results could differ materially from those set forth in the forward-looking statements. Some factors that might cause such a difference include the following: the ongoing war in Ukraine and the conflict in the Middle East and their impact on our tenants’ businesses and the farm economy generally, changes in trade policies in the United States and other countries who import U.S. agricultural products, high inflation and increasing interest rates, the onset of an economic recession in the United States and other countries that impact the farm economy, extreme weather events, such as droughts, tornadoes, hurricanes or floods, the impact of the COVID-19 pandemic and efforts to reduce its spreadfuture public health crises on our business and on the economy and capital markets generally, general volatility of the capital markets and the market price of our common stock, changes in our business strategy, availability, terms and deployment of capital, our ability to refinance existing indebtedness at or prior to maturity on favorable terms, or at all, availability of qualified personnel, changes in our industry interest rates or the general economy, the degree and nature of our competition, the outcomes of ongoing litigation, our ability to identify new acquisitions or dispositions and close on pending acquisitions or dispositions and the other factors described in the risk factors described in Item 1A, “Risk Factors” of ourthis Annual Report on Form 10-K for the year ended December 31, 2020, and in other documents that we file from time to time with the SEC. Given these uncertainties, undue reliance should not be placed on such statements. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking information,statements, except to the extent required by law.

Summary Risk Factors

Our business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial condition, results of operations, cash flows and prospects. These summary risks provideThe following is an overview of many of the most significant risks to which we are exposed to in the normal course of our business and which are discussed more fully in “Item 1A. Risk Factors” herein. These risks include, but are not limited to, the following:

Our business is dependent in part upon the profitability of our tenants' farming operations, and a sustained downturn in the profitability of their farming operations could have a material adverse effect on the amount of rent we can collect and, consequently, our cash flow and ability to make distributions to our stockholders.

We have a substantial amount of indebtedness outstanding, which may expose us to the risk of default under our debt obligations, restrict our operations and our ability to grow our business and revenues, and restrict our ability to pay distributions to our stockholders.

Mortgage debt obligations expose us to the possibility of foreclosure, which could result in the loss of our investment in a property or group of properties subject to mortgage debt.

We are currently subjectIncreases in benchmark interest rates will increase our borrowing costs, which will negatively impact our financial condition, results of operations, growth prospects and ability to and may in the future be subjectmake distributions to litigation or threatened litigation, which may divert management time and attention, require us to pay damages and expenses or restrict the operation of our business.stockholders.

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Increases in interest rates will increase our tenants’ borrowing costs and may make it more difficult for them to obtain credit.

Global economic conditions, including inflation, supply chain disruptions and trade policies affecting imports and exports, could adversely affect our and our tenants’ operations.

Approximately 70% of our portfolio is comprised of properties used to grow primary crops such as corn, soybeans, wheat, rice and cotton, which subjects us to risks associated with primary row crops.

Our farms are exposed to the possibility of extreme weather events, such as droughts, tornadoes, hurricanes and floods, which could damage the farmland and equipment, adversely affect crop yields and the ability of farmers to pay rent to us or adversely impact the financing of such properties.

Investments in farmland used for permanent/specialty crops through participating rest structures, leave us withhave a heightened exposure to the risks associated with those crops, especially in terms of yield and price volatility, and limited diversification.different risk profile than farmland used for annual row crops.

Our failure to continue to identify and consummate suitable acquisitions would significantly impede our growth and our ability to further diversify our portfolio by geography, crop type and tenant, which could materially and adversely affect our results of operations and cash available for distribution to our stockholders.

We do not intend to continuously monitor and evaluate tenant credit quality, and our financial performance may be subject to risks associated with our tenants' financial condition and liquidity position.

Our short-term leases albeit an industry standard, make us more susceptible to any decreases in prevailing market rental rates than would be the case if we entered into longer-term leases, which could have a material adverse effect on our results of operations and ability to make distributions to our stockholders.

We depend on external sources of capital that are outside of our control and may not be available to us on commercially reasonable terms or at all, which could limit our ability to, among other things, acquire additional properties, meet our capital and operating needs or make the cash distributions to our stockholders necessary to maintain our qualification as a REIT.

Some state laws, includingLaws in certain states where we own property prohibit or restrict the ownership of agricultural land by business entities, which could impede the growth of our portfolio and our ability to diversify geographically.

We may be subject to unknown or contingent liabilities related to acquired properties and properties that we may acquire in the future, which could have a material adverse effect on us.

We may be required to permit the owners of certain third-party access rights on our properties to enter and occupy parts of the properties, including owners of mineral rights and power generation and transportation infrastructure, which could materially and adversely impact the rental value of our properties.

We have previously been subject to, and may in the future be subject to, unknownlitigation or contingent liabilities relatedthreatened litigation, which may require us to acquired propertiespay damages and properties that we may acquire inexpenses or restrict the future, which could have a material adverse effect on us.operation of our business.

Conflicts of interest may exist or could arise in the future between the interests of our stockholders and the interests of holders of units in our operating partnership,Operating Partnership, which may impede business decisions that could benefit our stockholders.

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Our charter contains certain provisions restricting the ownership and transfer of our stock that may delay, defer or prevent a change of control transaction that might involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests.

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We could increase the number of authorized shares of stock, classify and reclassify unissued stock and issue stock without stockholder approval, which may delay, defer or prevent a transaction that our stockholders believe to be in their best interests.

Our Board of Directors may change our strategies, policies and procedures without stockholder approval.

Our charter contains provisions that make removal of our directors difficult, which could make it difficult for our stockholders to effect changes to our management.

Failure to maintain qualification as a REIT for U.S. federal income tax purposes would subject us to U.S. federal income tax on our taxable income at regular corporate rates, which would substantially reduce our ability to make distributions to our stockholders.

Complying with the REIT requirements may cause us to forego otherwise attractive opportunities or sell properties earlier than we wish.

We may be unable to make distributions at expected levels, which could result in a decrease in the market price of our common stock.

We are subject to risks associated with public health crises, such as pandemics and epidemics, which may have a material adverse effect on our business. The nature and extent of future impacts are highly uncertain and unpredictable.

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PART I

Item 1. Business

Our Company

References to “we,” “our,” “us” and “our company” refer to Farmland Partners Inc., a Maryland corporation, together with our consolidated subsidiaries, including Farmland Partners Operating Partnership, L.P., a Delaware limited partnership (the “Operating Partnership” (“FPI”), collectively with its subsidiaries, is an internally managed real estate company that owns and seeks to acquire high-quality farmland located in agricultural markets throughout North America. FPI was incorporated in Maryland on September 27, 2013. FPI elected to be taxed as a real estate investment trust (“REIT”) under Sections 856 through 860 of which we arethe Internal Revenue Code of 1986, as amended (the “Code”), commencing with its short taxable year ended December 31, 2014.

FPI is the sole member of the sole general partner.partner of Farmland Partners Operating Partnership, LP (the “Operating Partnership”), which was formed in Delaware on September 27, 2013. All of FPI’s assets are held by, and its operations are primarily conducted through, the Operating Partnership and the wholly owned subsidiaries of the Operating Partnership. As of December 31, 2023, FPI owned a 97.6% interest in the Operating Partnership. See “Note 9—Stockholders’ Equity and Non-controlling Interests” for additional discussion regarding Class A Common units of limited partnership interest in the Operating Partnership (“Common units”), Series A preferred units of limited partnership interest in the Operating Partnership (“Series A preferred units”) and Series B participating preferred units of limited partnership interest in the Operating Partnership (“Series B participating preferred units”). Unlike holders of FPI’s common stock, par value $0.01 per share (“common stock”), holders of the Operating Partnership’s Common units and Series A preferred units generally do not have voting rights or the power to direct the affairs of FPI.

References to the “Company,” “we,” “us,” or “our” mean collectively FPI and its consolidated subsidiaries, including the Operating Partnership.

We areOur primary strategic objective is to utilize our position as a leading institutional acquirer, owner and manager of high-quality farmland located in agricultural markets throughout North America to deliver strong risk adjusted returns to investors through a combination of cash dividends and asset appreciation. As of December 31, 2023, we owned farms with an internally managed public farmland real estate investment trust, with a portfolio spanningaggregate of approximately 155,000132,800 acres across 16 statesin Arkansas, California, Colorado, Florida, Illinois, Indiana, Kansas, Louisiana, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, South Carolina and Texas. In addition, as of December 31, 2020. Our company is currently diversified across more than 100 tenant farmers who grow more than 26 major commercial crops.2023, we owned land and buildings for four agriculture equipment dealerships in Ohio leased to Ag-Pro Ohio, LLC (“Ag Pro”) under the John Deere brand and served as property manager for approximately 38,300 acres, including farms in Iowa (see “Note 4—Related Party Transactions”). As of December 31, 2023, the dateOperating Partnership owned a 9.97% equity interest in Promised Land Opportunity Zone Farms I, LLC (the “OZ Fund”), an unconsolidated equity method investment, that holds 12 properties (see “Note 1, Convertible Notes Receivable”). As of this Annual Report on Form 10-K,December 31, 2023, approximately 70% of our farmlandowned portfolio (by value) iswas used to grow primary crops, such as corn, soybeans, wheat, rice and cotton, and the remainingapproximately 30% iswas used to growproduce specialty crops, such as almonds, citrus, blueberries, vegetables and edible beans.vegetables. We believe our portfolio gives investors exposure to the economic benefit of increasing global food demand trend in the face of growing scarcity of high qualityhigh-quality farmland and reflectswill continue to reflect the approximate breakdownallocation of U.S. agricultural output between primary crops and animal protein (whose production relies principally on primary crops as feed), on one hand, and specialty crops, on the other.

In addition, under the FPIwe offer a loan program (the “FPI Loan Program,Program”) pursuant to which we make loans to third-party farmers (both tenant and non-tenant) to provide financing for property acquisitions, working capital requirements, and operational farming activities, farming infrastructure projects and for other farming and agricultural real estate related purposes. As of the first quarter of 2021 we are also engaged in farmland asset management on behalf of third parties.projects.

All of our assets are held by, and our operations are primarily conducted through, the Operating Partnership and its wholly owned subsidiaries. As of the date of this Annual Report on Form 10-K, we own 95.4% of the Class A Common units of limited partnership interest in the Operating Partnership (“Common units”) and none of the Series A preferred units of limited partnership interest in the Operating Partnership (“Series A preferred units”) or shares of our 6.00% Series B Participating Preferred Stock (the “Series B Participating Preferred Stock”). Unlike holders of our common stock, holders of Common units, Series A preferred units, and Series B Participating Preferred Stock, generally do not have voting rights or the power to direct our affairs. See Note 9 to our consolidated financial statements for additional information regarding the Series A preferred units and our Series B Participating Preferred Stock.

In addition to farmland, we own improvements on our farms, such as irrigation, drainage and grain storage facilities. We also may acquire properties related to farming, such as stand-alone grain storage facilities, grain elevators, feedlots, processing plants and distribution centers, as well as livestock farms or ranches. In addition, we engage directly in farming through FPI Agribusiness Inc., our taxable REITa wholly owned subsidiary (the “TRS” or “FPI Agribusiness”), whereby weis a taxable REIT subsidiary that was formed to provide volume purchasing servicesto the Company’s tenants and to directly operate a small numberfarms under certain circumstances. As of December 31, 2023, the TRS performed direct farming operations on 2,103 acres (approximately 3,676 acres during 2020) relying on custom farming contracts with local farm operators.of permanent crop farmland owned by the Company located in California.

SomeFPI strategically seeks opportunities to promote environmentally friendly usage of our real estate is used forfarmland. We have long-term lease arrangements on certain farm properties pursuant to which operators engage in solar and wind energy production by operators with long term leases on our properties. Currently, fourteenproduction.

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As of December 31, 2023, 15 of our farms, havewhich collectively comprised approximately 10,150 acres, had leases for operational or under-construction renewable energy production, and seven16 of our farms, have leasewhich collectively comprise approximately 12,875 acres, had options for potential future solar or wind development.development and operating lease. Refer to “–Sustainability” for more information.

Our principal source of revenue is rent from tenants that conduct farming operations on our farmland.farmland pursuant to leases with terms ranging primarily from one to three years. The majority of the leases that are in place as of the date of this Annual Report on Form 10-K have fixed annual rentalrent payments. Some of our leases have a variable rent componentrents based on the revenue generated by our farm-operator tenants. We believe that thisa mix of fixed and variable rents helpswill help insulate us from the variability of farming operations and reduce our credit-risk exposure to farm-operator tenants while generating attractive risk-adjusted returns and making us an attractive landlord in certain regions where variable leases are customary. However, we may be exposed to tenant credit risk and farming operation risks, particularly with respect to leases that do not require advance payment of at least 50%100% of the annualfixed rent, leases for which thevariable rent is based on a percentage of a tenant's farming revenues,arrangements and leases with terms greater than one year.

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We elected  and qualified to be taxed as a real estate investment trust (“REIT”), under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with our short taxable year ended December 31, 2014.

Full Year 2020 and Recent2023 Highlights

During 2020:2023:

Operating revenues decreased 5.4% from 2019 for a total of $50.7 million as compared to 2019 operating revenues of $53.6 million;
Operating income decreased 15.2% from 2019 for a total of $22.3 million as compared to 2019 net operating income of $26.3 million;
Net income decreased 49.3%increased 164.9% from 2019$12.0 million for a total of $7.5the year ended December 31, 2022 to $31.7 million as compared to 2019 net income of $14.9 million; for the year ended December 31, 2023;
Adjusted Funds from Operations (“AFFO”Operation ("AFFO") decreased 59.5%48.4% from 2019$15.8 million for a total of $1.8the year ended December 31, 2022 to $8.1 million as compared to 2019 AFFO of $4.4 million;for the year ended December 31, 2023;
We completed three asset acquisitions for total gross consideration of $1.4 million;
We completed seven dispositions consisting of eleven farms for total gross74 properties in the Corn Belt, Delta and South, High Plains, Southeast and West Coast regions. We received $195.5 million in aggregate consideration, of $20.5including $11.8 million resulting in seller financing, and recognized an aggregate gain on sale of $3.2$36.1 million;
We completed acquisitions consisting of four properties in the Corn Belt and Delta and South regions. Aggregate cash consideration for these acquisitions totaled $22.2 million;
We repurchased approximately 1.0 million6,551,087 shares of our common stock at a weighted average price of $6.59$11.00 per share, or approximately $6.8share;
Total indebtedness decreased $76.4 million in the aggregate;from $439.5 million at December 31, 2022 to $363.1 million at December 31, 2023;
We increased liquidity to $206.6 million as of December 31, 2023, compared to $176.7 million as of December 31, 2022; and
We repurchasedrenewed fixed cash farm leases expiring in 2023 at average rent increases of approximately 140,000 shares of our Series B Participating Preferred Stock at a weighted average price of $22.08 per share, or approximately $3.1 million in the aggregate.20%.

For a definition of AFFO and a reconciliation of net income to AFFO, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Non-GAAP Financial Measures.”

Investment Focus

We seek to invest in farmland that will give our stockholders exposure to a well-diversified portfolio of high-quality U.S. farmland, while offering an attractive risk-adjusted combination of stable rental income generation and value appreciation. Our principal investment focus is on farmland located in agricultural markets throughout North America; however, we may seek to acquire farmland outside of North America in the future. We also may acquire propertiesreal estate assets related to farming, such as grain storage facilities, grain elevators, feedlots, cold storage facilities, controlled environment agriculture facilities, land and facilities leased to agriculture equipment dealerships, processing plants and distribution centers, as well as livestock farms or ranches. In addition, under the FPI Loan Program, we may provide loans to farm operators secured by farmland, properties related to farming, crops (growing or stored), and/or agricultural equipment. We may also invest in other agriculture relatedagriculture-related business, typically through our TRS.

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Crop Categories

Primary vs Specialty Crops

Farm crops generally can be divided into two principal categories: primary crops and specialty crops. Primary crops include, among others, corn, soybeans, wheat, rice and cotton. Primary crops are generally grown in rows and are often referred to as row crops. Specialty crops can be again divided into two categories: annual specialty crops (generally vegetables) and permanent specialty crops (fruits and nuts grown on trees, bushes or vines). Over the long term, we expect that our farmland portfolio will continue to be comprised of approximately 70% primary crop farmland and 30% specialty crop farmland by value, which we believe will give investors exposure to the economic benefit from increasing global food demand trend in the face of growing scarcity of high quality farmland and will reflect the approximate compositionallocation of U.S. agricultural output between primary crops and animal protein (whose production relies principally on primary crops as feed), on one hand, and specialty crops, on the other.

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The most widely grown crop in the United States is corn, at approximately 93 million acres. The uses of Contentscorn projected for the 2023/2024 marketing year (September 2023 to August 2024) are as follows: animal feed and residual products (34%); ethanol and its animal feed byproducts known as distillers’ dried grains with solubles or DDGS (32%); exports (13%); other sugars, starches, cereals, seeds (8%); and ending stocks or inventory (13%).

The second most widely grown crop in the United States is soybeans, at approximately 83 million acres. The uses of soybeans projected for the 2023/2024 marketing year (September 2023 to August 2024) are as follows: crushings (52%); exports (39%); seed and residual (3%); and ending stocks or inventory (6%). The process of crushing soybean produces soybean oil, soybean meal, hulls and waste. Soybean meal is used as animal feed both domestically and in the export market. Soybean oil is used for food, biofuel, and is exported.

The third most widely grown crop in the United States is wheat, at approximately 51 million acres. The uses of wheat projected for the 2023/2024 marketing year (June 2023 to May 2024) are as follows: food (38%); exports (29%); seed, feed and residual (7%); and ending stocks or inventory (26%).

Annual vs. Permanent Crops

Our portfolio includes farms that produce both annual and permanent crops. Annual crops, such as wheat, corn and soybeans, are planted every year whereas permanent crops, such as trees, bushes and vines, are planted and bear crops over multiple years.years without replanting. We believe exposure to both annual and permanent crops is an attractive strategy and offers diversification benefits to our portfolio. Annual and permanent crops typically serve different end-markets and generally have uncorrelated pricing.

U.S. Farmland Property

We believe that the United States offers farmland investors exposure to financial benefits driven by the fundamentals of agricultural production and farmland appreciation without many of the risks that come with farmland investments in many other countries. In the United States, the farmland market is relatively liquid and there is virtually no land title risk. As an asset class, United States farmland has lower leverage compared to other real estate sectors. According to the United States Department of Agriculture (“USDA”) forecast data from February 2024, real estate debt on farms is $377 billion, compared to a real estate value of $3.6 trillion, representing a 10% debt-to-equity ratio. The United States has the largest, lowest-cost grain transportation infrastructure in the world, leaving more margin to the grain producer and landowner. Moreover, the United States is one of the largest domestic markets for commodityprimary crops, which are typically priced in U.S. dollars. Lastly, we believe that in most major U.S. agricultural markets, multiple quality farm-operator tenants compete for farmland lease opportunities.

We may consider investing in farmland in other countries, such as Canada, Australia or New Zealand, that, like the United States, offer virtually no land title risk, a sophisticated farm-operator tenant environment and attractive rental rates, such as Canada, Australia or New Zealand.rates.

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Leased Properties

FarmingThe business of farming carries materially more operating risk than owning and leasing farmland to farm operators, although such risk can be mitigated through crop insurance and other risk management tools. We expect to continue to lease a majority of our properties on a fixed-rent basis that does not depend on the success of the tenant's farming operations. Moreover, a majority of the leases in our portfolio provide that at least 50% (and oftensometimes 100%) of the annual fixed rent is due and payable in advance of each spring planting season, and we expect that a majority of the fixed-rent leases we enter into in the future will have a similar requirement, which reduces our credit-risk exposure in the event of operational issues with the farm-operator tenant. However, to the extent we enter into leases that do not require advance payment of 100% of the annual rent or have terms greater than one year, we may be subject to tenant credit risk and more susceptible to the risks associated with declines in the profitability of tenants’ farming operations, and we take such risk into consideration when evaluating the potential return on a farm. We may use variable-rent leases, which depend in part on crop yields and prices, in regions where such arrangements are prevalent or when we expect that such arrangements will be more profitable to us on a risk-adjusted basis. We also may utilize hybrid lease arrangements that requireprovide for a modestcombination of fixed rent payment at lease inception and an additional rent payment based on a percentage of the revenue from the tenant's harvest for that year.variable rent.

We expect to continue to lease the majority of our primary crop farmland and other farming related properties under leases that require the tenant to either pay or reimburse us for substantially all of the property’s operating expenses, including maintenance, water usage and insurance. Consistent with industry practices, we expect that we will generally be responsible for plantings and associated improvements on our permanent crop farmland while our tenants will be responsible for all operating costs. SeveralMany of our leases provide for the reimbursement by the tenant of the property’s real estate taxes that we pay in connection with the farms they rent from us. The rental payments we receive from the farm operators are the primary source of any distributions that we make to our stockholders.

We expect that over time rental income will increase. Most farmland in the areas where we own or intend to acquire land is leased under short-term leases (typically five years or less), and we plan to lease our primary crop properties under short-term leases when possible. By entering into short-term leases, we believe we will be in a position to increase our rental rates when the leases expire and are renewed or the land is re-leased, if prevailing rental rates have increased.expire. However, we can provide no assurances that we will be able to increase our rental rates, or even maintain them at the same level, when the leases are renewed or the land is re-leased.

We believe quality farmland has a near-zero vacancy rate, and we believe that all high-quality farmland in an area with a competitive tenant environment is generally leased and farmed each year. For leases that provide thatIn the event of a substantial portion of rental payments for a crop year aretenant's failure to pay rent due in advance of the spring planting season, in the event of a tenant's failure to pay

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rent when due, we will seek to terminate the lease and rent the property to another tenant that could then plant and harvest a crop that year. As a result, we believe there is a reduced risk of vacancy on our properties when compared to most other types of commercial properties, such as office buildings or retail properties.

Tenants

We believe the areas where we own and intend to acquire farmland are characterized by a competitive farm-operator tenant environment, with multiple experienced farm operators seeking to expand their operations by leasing additional farmland. Farmers have long rented land to increase operations without having to invest the capital required to own the land. USDA data shows that rented land as a percentage of total farmland acres has been in the 35% to 45% range since the 1920s.

Non-Farming Leases

In addition to leases entered into in connection with farming operations, we seek additional sources of income from our properties that are either incremental, such as wind easements and recreational leases, or are higher than farming rents, such as leases for solar power installations. While we do not believe that such other sources ofnon-farming lease income will constitute a significant percentage of our total revenues, they offer opportunities to enhance returns to stockholders at little or no cost to us.

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Family-Owned Properties

According to America’s Farms and Ranches at a Glance 2023 Edition, a USDA report, family farms accounted for approximately 97% of the USDA, as of 2019, approximately 98% oftotal farms in the United States were owned by families.States. As shown below, small family farms represent the greatest number of farms and amount of land, while large-scale family farms represent the greatest value of production.

Farm Category

    

Annual Gross Farm Cash Income

    

Number of Farms

    

Percent of Farms

    

Percent of Land Area

    

Value of Production

Small Family Farms

Less than $350,000

1,756,441

88.1

%

46.5

%

18.7

%

Midsize Family Farms

Less than $1,000,000

115,595

5.8

%

21.4

%

19.1

%

Large-Scale Family Farms

Greater than $1,000,000

67,936

3.4

%

24.8

%

51.8

%

Nonfamily Farms

54,450

2.7

%

7.3

%

10.4

%

Total

1,994,422

100.0

%

100.0

%

100.0

%

Farmland leases allow farm operators to unlock personal or family capital/net worth that would otherwise be tied up in land ownership while retaining the ability to conduct their livelihoods on land that is familiar to them. We believe that many farm families and individuals may wish to simultaneously sell some of their property and lease it back, continuing their operation of such property under a leasing arrangement. Sellersengage in these sale-leaseback transactions can use the sale proceeds to repay existing indebtedness, for growth ofgrow their farming operations or in other business endeavors. Under some circumstances, these sale-leaseback transactions might be driven byendeavors, or for estate planning reasons. We believe that the farmland that we acquire and do not simultaneously lease back to the seller can be leased at attractive rental rates to other farm operators.reasons, providing a continuous pipeline of prospective acquisitions.

As an alternative to selling their farmland to us in an all-cash transaction, we believe that manysome farm owners may be interested in selling their farmland to us in exchange for Operating Partnership units in order to have an equity interest in our company and participate in any appreciation in value of our properties. By making such an exchange, these farm owners would become investors inown a more diversified portfolio of agricultural real estate. Under certain circumstances, the exchange of real estate for Partnership units isin transactions that may qualify as tax-deferred contributions to a tax-deferred exchangepartnership under U.S. federal income tax laws. In addition, because we intend to make cash distributions quarterly or annually, Partnership unit holders would receive regular cash distributions.distributions, and their investment would be diversified across a much larger number of properties than the single property in which they were invested before such contribution. Finally, Partnership unit holders would have the flexibility to tender their Partnership units in the future for redemption by us for cash, or, at our election, shares of our common stock that they could then sell in the public market, thereby allowing these sellers to determine the timing of recognizing taxable gain. Because we expect the issuance of Partnership units in exchange for farmland generally will be driven by the desires of prospective sellers, we do not know how frequently we will issue Partnership units in exchange for farmland properties. However, we believe that using Partnership units as acquisition consideration can be a significant part of our property acquisition strategy.

Other Investments

In addition to farmland, we also may acquire propertiesreal estate assets related to farming, such as grain storage facilities, grain elevators, feedlots, cold storage facilities, controlled environment agriculture facilities, land and facilities leased to agriculture equipment dealerships, processing plants and distribution centers, as well as livestock properties.farms or ranches.

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Underwriting Criteria and Due Diligence Process

Identifying and Selecting the PropertyAttractive Properties

We seek to acquire high qualityhigh-quality farmland that offers an attractive risk-adjusted balance of current returnsincome and value appreciation potential. We believe our management team’s deep understanding of agribusiness fundamentals and insight into factors affecting the value of farmland allow us to identify properties consistent with our investment criteria. We believe the following factors are important in the selection of farmland:

Soil Quality—Soil quality is a fundamental determinant of farmland productivity and therefore of its value. In considering farmland for purchase, we take soil quality into consideration to determine whether the farmland is attractively priced. In general, we focus on farmland with average or better-than-average soil. 

Water Availability—Appropriate water availability is an essential input to farming and a key consideration in determining the productivity and value of farmland. We seek to acquire farmland where water availability through precipitation and irrigation meets the agronomic needs of the crops expected to be grown. As part of our acquisition due diligence process, we evaluate properties for water availability and any associated ground or surface water rights. Where appropriate, we may also invest in irrigation infrastructure to improve the productivity

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of properties we own. Occasionally we may acquire farmland at prices that more than compensate us for any potential reduction in water availability, which, in the future, may result in a shift to different crops or production systems.

Robust and Competitive Tenant Environment—We focus primarily on farmland located in areas characterized by a robust and competitive tenant environment, with a relatively large population of experienced farm operators as potential tenants. 

Market Access—Due to the higher costs of road transportation, the location of primary crop farmland relative to points of demand (e.g., grain elevators, feedlots and ethanol plants) or access to low-cost transportation (e.g., river ports and rail loading facilities) determines the premium or discount in farm-gate commodity prices compared to the general market prices (also known as “basis”), and therefore is one of the factors that impacts its value. We focus on acquiring primary crop farmland in areas with substantial farming infrastructure and low transportation costs, including markets with access to river and rail transportation.

Climate—Crops have particular climatic growing requirements. As such,Accordingly, we seek to acquire properties in regions with climates conducive to the expected crops. We believe that diversification within and across core farming regions and crop types provides significant annual and long-term risk mitigation to our investors.  Nevertheless, our farmland may experience periodic droughts and other significant weather events, such as tornadoes, hurricanes and floods.

We perform a due diligence review with respect to each potential property acquisition. The due diligence investigation includes both property-specific factors (e.g., soil types and fertility, water availability and rights, topographical characteristics and property taxes) and location-specific factors (e.g., climate, tenant availability and quality, and market access). As part of our due diligence process, we also perform a valuation of each target property and estimate expected lease rates.

Identifying and Selecting Tenants

We intend to continue to focus primarily on farm properties located in areas with a robust and competitive environment of experienced tenants. In general, the tenant selection process focuses primarily on candidates' experience and reputation based upon background and reference checks, as well as their willingness and ability to pay competitive rental rates. We consider similar factors in analyzing sale-leaseback transactions. In geographic areas where we already own one or more properties, we may give our existing local tenants priority consideration, especially in exchange for sourcingwhen a tenant sources the property acquisition opportunity. We often mitigate tenant credit risk by requiring a significant portionbelieve our use of a year'sleases pursuant to which at least 50% of the annual rent is typically payable in advance of each spring planting season whenever possible,mitigates the tenant credit risk associated with the variability of farming operations that could be adversely impacted by requiring a tenant to adoptpoor crop yields, weather conditions, mismanagement, undercapitalization or other factors affecting our tenants. Tenant credit risk is further mitigated by the farming industry practice of purchasing crop insurance and/orin almost every circumstance because it is required by securing agricultural or statutory liens onlenders who provide working capital financing to our tenants and due to requirements in our leases. In certain cases, the Company perfects its security interest in the crop insurance proceeds and the underlying growing crops.crops using practices applicable in the state where the farm is located. In addition, we monitor our existing tenants by periodically conducting site visits of the farms and meeting with the tenants to discuss their farming operations and the condition of the farms. However, in

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some circumstances, we may be exposed to tenant credit risk and may be subject to farming operation risks, such as adverse weather conditions and declines in commodity prices, particularly with respect to leases that do not require advance payment of 100% of the annual rent, variable-rent leases for which the rent is based on a percentage of a tenant's farming revenues and leases with terms greater than one year. See "Risk“Risk Factors—Risks Related to Our Business and Properties.” We do not intend to continuously monitor and evaluate tenant credit quality and may be subject to risks associated with our tenants' financial condition and liquidity position.

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Complementary Businesses

FPI Loan Program

We believe that our existing systems and personnel are well suited to source, conduct due diligence evaluations with respect to, close and manageservice loans under the FPI Loan Program at little or no additional operating cost to us. We believe that the business of making loans to farm operators secured by farmland, properties related to farmland, crops (growing or stored), and/or agricultural equipment leverages the substantial expertise in agribusiness possessed by the FPI team and is highly complementary to and synergistic with, our core business of investing in farmland. We generally find potential borrowers during the process of sourcing farm acquisitions. We conduct due diligence on loan collateral largely the same way we conduct due diligence on potential farm acquisitions, and we screen potential borrowers using criteria similar to those used to screen potential tenants. The FPI Loan Program offering gives us an increased visibility in the marketplace, thereby benefiting our core farmland investing business.

Asset Management for Third Parties

We believe that our existing systems and personnel are well suited to source, conduct due diligence evaluations with respect to, close and manage farmland on behalf of third parties at little or no additional cost to us, generating fee income that does not tie upwithout capital investment. As of December 31, 2023, we managed approximately 38,300 acres on behalf of third parties.

Brokerage and Auction Services

The acquisition of Murray Wise Associates, LLC (“MWA”) in November 2021 also added brokerage and auction business activities for clients seeking to sell farmland. This increases our own capital. We started engaging in this business though our TRSbreadth of activities in the first quarterfarmland sector, while adding additional sources of 2021, when we entered into an agreement to manage a portfolio of properties located in opportunity zones.revenue and market insight.

Seasonality

Because the leases for many of the properties in our portfolio require significant payments in advance of the spring planting season, we receive a significant portion of our fixed cash rental payments in the first calendar quarter of each year, although weWe recognize rental revenue from thesefixed-rate leases on a pro rata basis over the non-cancellable term of the lease in accordance with GAAP.accounting principles generally accepted in the United States (“GAAP”). Notwithstanding GAAP accounting requirements to spread rental revenue over the lease term, a significant portion of fixed rent is received in a lump sum before planting season, generally in the first quarter, and after harvest, in the fourth quarter or in the following year. We receive a significant portion of our variable rental payments following harvest in the fourth calendar quarter of each year, following harvest, with only a portion of such payments being recognized ratably through the year in accordance with GAAP, in relation to crop insurance contracts entered into by our tenants. The highly seasonal nature of the agriculture industry causes seasonality in our business to some extent.extent, with revenue in the first and fourth quarter tending to be meaningfully higher than revenue in the second and third quarters. Our financial performance should be evaluated on an annual basis, which eliminates quarterly performance variability due to crop share revenues, lease periods not matching fiscal years,impacts of seasonality and other similar factors that may cause our quarterly results to vary during the course of the year.

Our Properties

As of December 31, 2023, we owned farms with an aggregate of approximately 132,800 acres in Arkansas, California, Colorado, Florida, Illinois, Indiana, Kansas, Louisiana, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, South Carolina and Texas. In addition, as of December 31, 2023, we owned land and buildings for four agriculture equipment dealerships in Ohio leased to Ag Pro under the date of this Annual Report on Form 10-K, we ownJohn Deere brand and served as property manager for approximately 150,000 total38,300 acres, of farmland.including farms in Iowa (see “Note 4—Related Party Transactions”). During the year ended December 31, 2020,2023, the Company completed three acquisitionsdispositions, consisting of 74 properties, in Illinoisthe Corn Belt, Delta and Michigan, which were accounted for as asset acquisitions. Consideration totaled $1.4South, High Plains, Southeast and West Coast regions. We received $195.5 million in aggregate consideration, including $11.8 million in seller financing, and was comprisedrecognized an aggregate gain on sale of cash and reduction of notes receivable.$36.1 million. Also, during the year ended December 31, 2020,2023, the Company completed seven dispositionsacquisitions consisting of eleven farms in Illinois, Mississippi, Texas, Nebraska, and Arkansas. Cash receipts on these dispositions totaled $20.1 million with a total gain on sale of $3.2 million. On January 20, 2021, we entered into an agreement with Promised Land Opportunity Zone Farms I, LLC (the “OZ Fund”) to sell, throughout 2021, twelve farms located in opportunity zones as designated by the Tax Cuts and Jobs Act of 2017, and to provide farm management services on the farms for the OZ Fund in exchange for management fees going forward. On March 5, 2021, the Company completed the sale of nine farms to the OZ Fund. These sales are not reflectedfour properties in the table below.Corn Belt and Delta and South regions. Aggregate cash consideration for these acquisitions totaled $22.2 million. See “Managements’“Management’s Discussion and Analysis of Financial

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Condition and Results of Operations” for more information about our portfolio. The distribution of farms owned by regions is as follows:

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Region

Total Acres

Corn Belt

43,326

Delta and South

26,535

High Plains

29,566

Southeast

43,498

West Coast

11,586

154,511

Corn Belt includes farms located in Illinois, Michigan and eastern Nebraska. Delta and South includes farms located in Arkansas, Louisiana and Mississippi. High Plains includes farms located in Colorado, Kansas, western Nebraska, and South Dakota. Southeast includes farms located in Alabama, Florida, Georgia, North Carolina, South Carolina, and Virginia. West Coast includes farms located in California.

As of the date of this Annual Report on Form 10-K, our portfolio has the following rents or rent estimates for 2021 by lease type or status. This table does not include additional rents from properties not yet put in service due to improvement projects, loan interest income from loans outstanding under the FPI Loan Program, and other revenues:

($ in thousands)

Lease Type or Status - as of the date of this Annual Report

    

2021 Rent

    

%

Leases in place with third parties

Fixed rent (1)

$

31,335

73.0

%

Variable rent (2)

11,072

25.8

%

Leases being negotiated (3)

517

1.2

%

$

42,924

100.0

%

Tenant Reimbursements

4,005

$

46,929

Region (1)

    

Owned Acres

    

Managed Acres

    

Total Acres

Corn Belt (2)

44,527

22,027

66,554

Delta and South

26,427

8,763

35,190

High Plains

21,831

1,380

23,211

Southeast

28,825

6,107

34,932

West Coast

11,189

11,189

132,799

38,277

171,076

(1)Includes the fixed rent portion of leases providing for fixedCorn Belt includes farms located in Illinois, Indiana, Iowa, Missouri and variable rent components.eastern Nebraska. Delta and South includes farms located in Arkansas, Louisiana, Mississippi and Oklahoma. High Plains includes farms located in Colorado, Kansas and Texas. Southeast includes farms located in Florida, North Carolina and South Carolina. West Coast includes farms located in California.
(2)Management estimate based on farms’ historical productivityIn addition, we own land and regional crop price projections. We can provide no assurance that crop yields and prices will reach expected levels or that we will obtainbuildings for four agriculture equipment dealerships in Ohio leased to Ag Pro under the rents we anticipate.
(3)Management’s estimate based on the current status of lease negotiations and the current leasing market environment for each farm. We can provide no assurance that the rents we obtain will reflect the current status of our lease negotiations or the current leasing market environment for each farm.John Deere brand.

Tax Status

We elected and qualified to be taxed as a REIT for U.S. federal income tax purposes commencing with our short taxable year ended December 31, 2014. Our qualification as a REIT will depend upon our ability to meet, on a continuing basis, through actual investment and operating results, various complex requirements under the Code, relating to, among other things, the sources of our gross income, the composition and values of our assets, our distribution levels and the diversity of ownership of our capital stock. We believe that we are organized in conformity with the requirements for qualification as a REIT under the Code and that our intended manner of operation will enable us to meet the requirements for qualification and taxation as a REIT for U.S. federal income tax purposes.

As a REIT, we generally are not subject to U.S. federal income tax on our taxable income that we distribute to our stockholders. Under the Code, REITs are subject to numerous organizational and operational requirements, including a requirement that they distribute on an annual basis at least 90% of their REIT taxable income, determined without regard to the deduction for dividends paid and excluding any net capital gains. If we fail to qualify for taxation as a REIT in any taxable year and do not qualify for certain statutory relief provisions, our income for that year will be subject to tax at regular corporate rates, and we would be disqualified from taxation as a REIT for the four taxable years following the year during which we ceased to qualify as a REIT. Even if we qualify as a REIT for U.S. federal income tax purposes, we may still be subject to state and local taxes on our income and assets and to U.S. federal income and excise taxes on our undistributed income. Additionally, any income earned by FPI Agribusiness Inc., our taxable REIT subsidiary, and any other taxable REIT subsidiaries that we form or acquire in the future will be fully subject to U.S. federal, state and local corporate income tax.

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Insurance

The Company maintains comprehensive property and casualty and general liability insurance through its relationship with a national insurance brokerage firm with extensive agricultural experience. The Company’s workers’ compensation is provided through a professional employee organization, and the Company maintains liability insurance covering its directors and officers. Certain other insurance programs are maintained as required by contract or deemed necessary by our management team, including crop insurance for farms operated by the Company. Under the terms and conditions of the leases on our current properties, tenants are generally required, at their expense, to obtain and keep in full force during the term of the lease liability and property damage insurance policies and to name us an additional insured party. To the extent required, tenants also maintain workers’ compensation policies for their businesses. These policies include liability coverage for bodily injury and property damage arising out of the ownership, use, occupancy or maintenance of the properties and all of their appurtenant areas. In addition to our tenants' insurance policies under which we will be an additional insured party, we also maintain comprehensive liability and casualty insurance covering all of our properties under a blanket insurance policy, which provides coverage to the extent there is insufficient coverage under our tenants' policies. The terms of leases that include variable rent payments generally require the tenant to carry crop insurance protecting against crop failures andand/or crop price declines.

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Regulation

Farming Regulations

The farmland that we own and intend to acquire in the future is typically used for growing crops and is subject to the laws, ordinances and regulations of state, local and federal governments, including laws, ordinances and regulations involving land use and usage, water rights, treatment methods, disturbance, the environment and eminent domain.

Farmland is principally subject to environmental and agricultural laws, ordinances and regulations. Each governmental jurisdiction has its own distinct laws, ordinances and regulations governing the use of farmland. Many such laws, ordinances and regulations seek to regulate water usage and water runoff because water can be in limited supply, as is the case where certain of the properties in our portfolio are located.

All of the farms in our portfolio have sources of water, including expected precipitation, existing and planned wells and/or surface water, that currently provide sufficient amounts of water necessary for the current farming operations at each location. However, should the need arise for additional water from wells and/or surface water sources, such permits and approvals may be difficult to obtain in areas with limited supply of available water. We believe that as of the date of this Annual Report on Form 10-K our farms are in compliance with applicable state, county and federal environmental and agricultural regulations.

In addition to the regulation of water usage and water runoff, state, local and federal governments also seek to regulate the type, quantity and method of use of chemicals and materials for growing crops, including fertilizers, pesticides and nutrient rich materials. Such regulations could include restricting or preventing the use of such chemicals and materials near residential housing or near water sources. Further, some regulations have strictly forbidden or significantly limited the use of certain chemicals and materials.

As an owner of farmland, we may be liable or responsible for the actions or inactions of our tenants with respect to these laws, regulations and ordinances.

Real Estate Industry Regulation

Generally, the ownership and operation of real properties is subject to various laws, ordinances and regulations, including regulations relating to zoning, land use, water rights, wastewater, storm water runoff and lien sale rights and procedures. These laws, ordinances or regulations, such as the Comprehensive Environmental Response and Compensation Liability Act (“CERCLA”) and its state analogs, or any changes to any such laws, ordinances or regulations, could result in or increase the potential liability for environmental conditions or circumstances existing, or created by tenants or others, on our properties. Laws related to upkeep, safety and taxation requirements may result in significant unanticipated expenditures, loss of our properties or other impairments to operations, any of which would adversely affect our cash flows from operating activities.

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Environmental Matters

As an owner of real estate, we will be subject to various federal, state and local environmental laws, regulations and ordinances and also could be liable to third parties resulting from environmental contamination or noncompliance at our properties. Environmental laws often impose liability without regard to whether the owner or operator knew of or was responsible for the presence of the contaminants. The costs of any required investigation or cleanup of these substances could be substantial. The liability is generally not limited under such laws and could exceed the property’s value and the aggregate assets of the liable party. The presence of contamination or the failure to remediate contamination at our properties also may expose us to third-party liability for personal injury or property damage or adversely affect our ability to lease the real property or to borrow using the real estate as collateral. These and other risks related to environmental matters are described in more detail in “Item 1A. Risk Factors.”

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Environmental, Social and Governance (“ESG”)Sustainability

We believe a strong commitment to ESGmulti-faceted sustainability supports our business model and promotes environmental stewardship, sustainsstewardship. Our sustainability policy is founded on the principle of helping feed the world, especially people in poverty, with the least negative environmental impact possible. Sustainability is considered a safehigh priority topic at all levels of our organization, with a commitment formulated by the Board of Directors and healthy workplace,senior management team.

Social Impact, Human Rights, and upholds high standardsCompany Culture

Utilizing land for farming creates a more sustainable future for all by affordably feeding the world’s growing population and supplying food products that support better nutrition. Moreover, we act as a channel to bring capital, and therefore economic activity, to rural communities throughout the United States, supporting farming as a livelihood as it has been for thousands of business ethicsyears. We support the United Nations’ Universal Declaration of Human Rights and conduct.are committed to ensuring that human rights are respected throughout our extended community of employees, tenants and suppliers. We require our tenants to comply with all applicable labor and environmental regulations. We foster a company culture based on open communication and professional growth, and support employees engaged with non-profit organizations.

Environmental Sustainability

Farmland is one of the mostmore environmentally friendly usesthan most types of commercial real estate, as agriculture naturally uses solar energy to capture carbon dioxide from the atmosphere and convert it into food, feed, fuel, and fiber. Principles of environmental sustainability are deeply interwoven into modern agricultural practices and are embedded into our farmland acquisition criteria and management practices. We foster long termlong-term relationships with our tenants, who are incentivized to provide good stewardship for the land they rent from us. The use of farmland as a carbon sink to generate carbon credits is a double-impact (environmental and financial) opportunity that we believe will continue to increase in significance in coming years.

Renewable energy generation (wind and solar) is a component of our business model of growing importance.

Social Impact As of December 31, 2023, we leased acres to support 3 solar energy operational projects across 11 farms and Company Culture

Farmland creates a more sustainable2 wind energy projects across 4 farms, which have the capacity to generate approximately 214 and 30 megawatts of renewable energy, respectively. We own 16 additional farms which have options for future for allsolar projects. We expect to continue to take advantage of opportunities to place solar panels and windmills on farmland owned by affordably feeding the world’s growing population and supplying food products that support better nutrition, both quantitatively and qualitatively. We are a channel to bring capital, and therefore economic activity, to rural communities throughout the United States. We foster a company culture based on open communication and professional growth, and support employees engaged with non-profit organizations.

Governance Fiduciary Duties and EthicsFPI.

We recognize that transparencyplace significant emphasis on the support of biodiversity and employing an arraywildlife. Our portfolio supports biodiversity through the enrollment of best practicesacres, in corporate governance better serves all stakeholders.  Our boardpartnership with our tenants, in the U.S. Department of directors, management teamAgriculture’s Conservation Reserve Program (CRP). In exchange for a yearly rental payment, CRP participants agree to remove less-productive land from agricultural production and employees maintainre-establish native vegetation to improve water quality, prevent erosion, and protect wildlife habitat. We also agreed in 2021 to sell Ducks Unlimited (“DU”) approximately 1,268 acres of farmland in a three-part conservation transaction to support habitat restoration and protection in Virginia. The multi-year, staged sale concluded in November 2023 and was designed to provide DU maximum flexibility to secure capital for the highest ethical standards acrossproject. Many more of our processes, business practices,farms provide habitat for waterfowl and policies.  

ESG Strategy

Going forward, we intend to maintain and expand our focus on ESG principles already embedded in our culture, policies and practices, gradually implementing efforts to measure, improve and communicate our performance. We expect our ESG objectives and the resources allocated to ESG matters will continue to evolve over time as we assess strategies that are most appropriate for our organizationother wildlife.

Competition

Competition to acquire farmland can come from many different entities.sources. Individual farmers are the most active buyers of farmland. Institutional investors, investment funds, other farmland REITs, individual investors and others also compete for farmland acreage. Investment firms that we might compete directly against for investment capital to be deployed in farmland could include agricultural investment firms such as Westchester Agriculture Asset Management (a TIAA company), Hancock AgriculturalManulife Investment Group,Management, International Farming Corporation, Ceres Partners, Gladstone Land Corp,Corporation, UBS Agrivest, AgIS Capital, Homestead Capital, and UBS Agrivest.Goldcrest Farm Trust Advisors. These firms engage in the acquisition, asset management, valuation and disposition of farmland properties.

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Human Capital Resources

Our employees are vital to our success. Our goal is to ensure that we have the right talent, in the right place, at the right time. We do that through our commitment to attracting, developing and retaining our employees.

We have designed a compensation structure, including an array of benefit and long termlong-term incentive plans, that we believe is attractive to our current and prospective employees. We also offer employees the opportunity to participate in conferences and continuing education.

We seek to retain our employees by using their feedback to create and continually enhance programs that support their needs. We have a formal performance review process for our employees. We have a values-based culture, an important factor in retaining our employees. We are committed to having a diverse workforce, and an inclusive work environment is a natural extension of our culture.

At March 15, 2021,December 31, 2023, we had 1426 employees, 1125 of which are full time. None of our employees are a member of a labor union.

Corporate Information

Our executive offices are located at 4600 South Syracuse Street, Suite 1450, Denver, Colorado 80237. Our telephone number at our executive offices is (720) 452-3100 and our corporate website is www.farmlandpartners.com. The information on, or accessible through, our website is not incorporated into and does not constitute a part of this Annual Report on Form 10-K or any other report or document we file with or furnish to the SEC.

Available Information

We file our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to those reports with the SEC. You may obtain copies of these documents by accessing the SEC’s website at www.sec.gov. In addition, as soon as reasonably practicable after such materials are furnished to the SEC, we make copies of these documents available to the public free of charge through our website or by contacting our Secretary at the address set forth above under “—Corporate Information.”

Our Corporate Governance Guidelines, Code of Business Conduct and Ethics, and the charters of our audit committee, compensation committee, and nominating and corporate governance committee are all available in the Governance Documents section of the Corporate Information section of our website. The information accessible on our website is not incorporated in, nor should be considered a part of, this Annual Report on Form 10-K.

Financial Information

For required financial information related to our operations, please refer to our consolidated financial statements, including the notes thereto, included within this Annual Report on Form 10-K.

Item 1A. Risk Factors

Set forth below are the risks that we believe are material to our stockholders. You should carefully consider the following risks in evaluating our Company and our business. The occurrence of any of the following risksfactors, events or circumstances described below could materially adversely impact our financial condition, results of operations, cash flow, the market price of shares of our common stock and preferred stock and our ability to, among other things, satisfy our debt service obligations and to make distributions to our stockholders, which in turn could cause our stockholders to lose all or a part of their investment. Some statements in this report including statements in the following risk factors constitute forward-looking statements. Please refer to the section entitled “Special Note Regarding Forward-Looking Statements” at the beginning of this Annual Report on Form 10-K.

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Risks Related to Our Business and Properties

Our business is dependent in part upon the profitability of our tenants' farming operations, and a sustained downturn in the profitability of their farming operations could have a material adverse effect on the amount of rent we can collect and, consequently, our cash flow and ability to make distributions to our stockholders.

We depend on our tenants to operate the farms we own in a manner that generates revenues sufficient to allow them to meet their obligations to us, including their obligations to pay rent and real estate taxes, maintain certain insurance coverage and maintain the properties generally. The ability of our tenants to fulfill their obligations under our leases depends, in part, upon the overall profitability of their farming operations, which could be adversely impacted by, among other things, adverse weather conditions, crop prices, crop disease, pests, and unfavorable or uncertain political, economic, business, trade or regulatory conditions. We are susceptible to any decline in the profitability of our tenants' farming operations, to the extent that it would impact their ability to pay rents. In addition, many farms are dependent on a limited number of key individuals whose injury or death may affect the successful operation of the farm. We can provide no assurances that, if a tenant defaults on its obligations to us under a lease, we will be able to lease or re-lease that farm on economically favorable terms in a timely manner, or at all. In addition, we may experience delays in enforcing our rights as landlord and may incur substantial costs in protecting our investment.

As a result, any downturn in the profitability of the farming operations of our tenants or a downturn in the farming industry as a whole could have a material adverse effect on our financial condition, results of operations, cash flow and ability to make distributions to our stockholders.

We have a substantial amount of indebtedness outstanding, which may expose us to the risk of default under our debt obligations, restrict our operations and our ability to grow our business and revenues and restrict our ability to pay distributions to our stockholders.

As of December 31, 2020,2023, we had approximately $508.2$363.1 million of outstanding indebtedness excluding debt issuance costs, most of which is secured by mortgages on our farms. We intend to incur additional debt in connection with refinancingsrefinancing of existing indebtedness, future acquisitions or for other purposes and, if necessary, we may borrow funds to make distributions to our stockholders in order to qualify and maintain our qualification as a REIT for U.S. federal income tax purposes. On January 29, 2021, the Company entered into an agreement with Farm Credit Mid-America to extend the maturities on our $112.0 million of outstanding debt maturing on January 1, 2022, to April 1, 2022. In addition, we have sold farms in order to repay indebtedness in the past and may do so in the future. Such dispositions may come at inopportune times or on disadvantageous tems,terms, which could result in losses.

In addition, our debt agreements include customary events of default, the occurrence of any of which, after any applicable cure period, would permit the lenders to, among other things, accelerate payment of all amounts outstanding under the loans and to exercise their remedies with respect to the collateral, including foreclosure and sale of the agricultural real estate securing the loans. Certain of our debt agreements also contain cross-default provisions that give the lender the right, in certain circumstances, to declare a default if we are in default under other loans. If we default on our debt coming due in 2022, it could cause the acceleration of a significant portion of our indebtedness as a result of these cross-default provisions If any one of these events were to occur, our financial condition, results of operations, cash flow and ability to pay distributions to our stockholders could be materially and adversely affected.

Mortgage debt obligations expose us to the possibility of foreclosure, which could result in the loss of our investment in a property or group of properties subject to mortgage debt.

As of December 31, 2020,2023, we had approximately $508.2$363.1 million of outstanding mortgage indebtedness excluding debt issuance costs. We intend to finance future property acquisitions, in part, with mortgage indebtedness. Mortgage and other secured debt obligations increase our risk of property losses because defaults on indebtedness secured by properties may result in foreclosure actions initiated by lenders and ultimately our loss of the property securing any loans for which we are in default. Any foreclosure on a mortgaged property or group of properties could adversely affect the overall value of our portfolio of properties. For tax purposes, a foreclosure on any of our properties that is subject to a nonrecourse mortgage loan would be treated as a sale of the property for a purchase price equal to the outstanding balance of the debt

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secured by the mortgage. If the outstanding balance of the debt secured by the mortgage exceeds our tax basis in the property, we would recognize taxable income on foreclosure, but would not receive any cash proceeds, which could hinder our ability to meet the REIT distribution requirements imposed by the Code.

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Our debt financing agreements restrict our ability to engage in certain business activities, including our ability to incur additional indebtedness, make capital expenditures and make certain investments.

Our existing debt financing agreements contain, and other debt financing agreements we may enter into in the future may contain customary negative covenants and other financial and operating covenants that, among other things:

restrict our ability to incur additional indebtedness;
restrict our ability to incur additional liens;
restrict our ability to make certain investments (including certain capital expenditures);
restrict our ability to merge with another company;
restrict our ability to sell or dispose of assets;
restrict our ability to make distributions to stockholders; and
require us to satisfy minimum financial coverage ratios, minimum tangible net worth requirements and maximum leverage ratios.

We are currently subject to, and mayIncreases in the future be subject to, litigation or threatened litigation,benchmark interest rates will increase our borrowing costs, which may divert management time and attention, require us to pay damages and expenses or restrict the operation of our business.

We are currently subject to, and may be subject in the future, to litigation or threatened litigation, including claims relating to the actions of our tenants, claims brought by stockholders, and otherwise in the ordinary course of business.  In particular, we are subject to the risk of complaints by our tenants involving premises liability claims and alleged violations of landlord-tenant laws, which may give rise to litigation or governmental investigations, as well as claims and litigation relating to real estate rights or uses of our properties. We are also subject to shareholder litigation and subject to a risk of additional shareholder litigation in the future.  Some of the pending and potential future claims against the company may result in significant defense costs and potentially significant judgments against us, some of which are not, may not be, or cannot be, insured against. Additionally, whether or not any dispute actually proceeds to litigation, we may be required to devote significant management time and attention to its successful resolution (through litigation, settlement or otherwise), which would detract from our management's ability to focus on our business. Any such resolution could involve the payment of damages or expenses by us, which may be significant, or involve our agreement with terms that restrict the operation of our business. We generally intend to vigorously defend ourselves; however, we cannot be certain of the ultimate outcomes of pending claims against the Company or of those claims that may arise in the future. Resolution of these types of matters against us may result in our having to pay significant fines, judgments, or settlements, which, if uninsured, or if the fines, judgments, and settlements exceed insured levels, could adverselywill negatively impact our earnings and cash flows, thereby having an adverse effect on our financial condition, results of operations, cash flowsgrowth prospects and our ability to paymake distributions to stockholders.

Beginning in 2022, the Board of Governors of the United States Federal Reserve Bank (the “Federal Reserve”) has undertaken a significant tightening of monetary policy, which has increased borrowing costs (through the resulting increase in interest rates) and decreased credit availability. The Federal Reserve has maintained elevated benchmark interest rates during 2022 and 2023 to help curb inflation, and although the Federal Reserve may reduce benchmark interest rates in 2024, there are no assurances that interest rates will be reduced on the anticipated timeline, and the per share trading priceinterest rates remain high. Future periods of rising interest rates could increase our borrowing costs on our existing floating-rate indebtedness as well as on any future fixed or floating rate indebtedness used to refinance existing indebtedness or to acquire new properties. As of December 31, 2023, $136.0 million of our common stock. Certain litigation oroutstanding indebtedness was subject to interest rates that reset from time to time (excluding our floating rate debt), of which $43.9 million was subject to interest rates that will be reset in 2024. As of December 31, 2023, the resolutionweighted average interest rate of certain litigation may affect the availability or costindebtedness subject to interest rate resets in 2024 was 3.07%, which we expect to increase significantly if benchmark interest rate levels remain constant as we expect them to during the course of some2024 (for more information on rate resets see “Note 7—Mortgage Notes, Lines of Credit and Bonds Payable”). Increases in borrowing costs could reduce our insurance coverageincome and could expose us to increased risks that would be uninsured, and/or adversely impact our ability to attract officerscash flow and directors, which couldmaterially and adversely impact our results of operations, cash flowsfinancial condition and our ability to paymake distributions to our stockholders.

Increases in interest rates will increase our tenants’ borrowing costs and make it more difficult for them to obtain credit and may cause land prices to decline.

Increasing interest rates result in higher borrowing costs for farmers and may make it more difficult for farm operators to obtain indebtedness to fund their operations, which could have an adverse impact on our tenants’ ability to make rental payments to us. Higher interest rates also tend to decrease U.S. and world economic growth, thus decreasing the valuedemand for certain agricultural commodities.

All of these consequences could reduce farm income. If increases in interest rates are not accompanied by higher levels of farm income, this could lead to a reduction in our tenants’ profitability, which could have a material adverse effect on our business or results of operations, financial condition, and ability to make distributions to our stockholders.

We have issued Series A preferred units that may be converted to Common units on or after February 10, 2026, which Common units would be immediately redeemable, for cash or shares of common stock at the Company’s option. The conversion of such Series A preferred units and potential redemption of the converted Common units for shares of common stock could have an immediate dilutive effect on the ownership interests of our common stockholders.  

On or after February 10, 2026 (the “Conversion Right Date”), holders of the Series A preferred units have the right to convert each Series A preferred unit into a number of Common units equal to (i) the $1,000 liquidation preference plus all accrued and unpaid distributions, divided by (ii) the volume-weighted average price per share of the Company’s common

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stock for the 20 trading days immediately preceding the applicable conversion date. All Common units received upon conversion may be immediately tendered for redemption for cash or, at the Company’s option, for shares of common stock on a one-for-one basis, subject to the terms and conditions set forth in the Partnership Agreement. Prior to the Conversion Right Date, the Series A preferred stock. For more informationunits may not be tendered for redemption by the Holder. To the extent the Series A preferred units are converted to Common units and such Common units are redeemed for shares of common stock, our existing common stockholders would experience an immediate, and potentially significant, dilutive effect on their ownership interest in the Company, which could cause the market price of our common stock to be materially adversely affected.  

Global economic conditions, including inflation and supply chain disruptions, could adversely affect our and our tenants’ operations.

General global economic downturns and macroeconomic trends, including heightened inflation, volatility in the capital markets, interest rate and currency rate fluctuations, the war in Ukraine and the ongoing conflict in the Middle East, changes in trade policies among nations that import and/or export agricultural products and economic slowdown or recession, may result in unfavorable conditions that could negatively affect demand for our tenants’ crops and exacerbate some of the other risks that affect our business, financial condition and results of operations. In addition, during 2022 and 2023 the Federal Reserve repeatedly raised interest rates in response to concerns about inflation. Interest rate increases or other government actions taken to reduce inflation could also result in an economic recession.

Our tenants have experienced challenges in their supply chains and related price increases. Continued deterioration in the domestic or international economic environment may cause decreased demand for our ongoing legal proceedings, see Item 3, Legal Proceedings, included elsewheretenants’ crops, which could result in this Annual Reportlower sales volume and lower prices for their crops, as well as increase the cost of operating their businesses and a corresponding adverse effect on Form 10-K.  their ability to make rental payments to us, which would adversely impact our financial condition and results of operations.

Approximately 70% of our portfolio is comprised of properties used to grow primary crops such as corn, soybeans, wheat, rice and cotton, which subjects us to risks associated with primary row crops.

By value, approximately 70% of our portfolio is used for primary crops, such as corn, soybeans, wheat, rice and cotton. As a result, any development or situation that adversely affects the value of properties generally, or the prices of corn, soybeans, wheat, rice or cotton, could have a more significant adverse impact on us than if our portfolio had less exposure to primary crops, which could materially and adversely impact our financial condition, results of operations and ability to make distributions to our stockholders.

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Investments in farmland used for permanent/specialty crops have a different risk profile than farmland used for annual row crops.

By value, approximately 30% of our portfolio is used for permanent crops, and, in the future, we may add to our investments in farmland used for permanent crops, as opposed to annual row crops. Permanent crops have plant structures (such as trees, vines or bushes) that produce yearly crops without being replanted. Examples include blueberries, oranges, apples, almonds and grapes. Permanent crops require more time and capital to plant and bear fruit and are more expensive to replace. If a farmer loses a permanent/specialty crop to drought, flooding, fire or disease, there generally would be significant time and capital needed to return the land to production because a tree or vine may take years to grow before bearing fruit.

Permanent crop plantings also reduce a farmer’s ability to adapt to changing market conditions by changing crops. If demand for one type of permanent crop decreases, the permanent crop farmer cannot easily convert the farm to another type of crop because permanent crop farmland is dedicated to one crop during the lifespan of the trees or vines and therefore cannot easily be rotated to adapt to changing environmental or market conditions.

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Our failure to continue to identify and consummate suitable acquisitions would significantly impede our growth and our ability to further diversify our portfolio by geography, crop type and tenant, which could materially and adversely affect our results of operations and cash available for distribution to our stockholders.

Our ability to expand through farmland acquisitions is important to our business strategy and requires that we identify and consummate suitable acquisition or investment opportunities that meet our investment criteria and are compatible with our growth strategy. We compete for the acquisition of farmland and propertiesreal estate assets related to farming with many other entities engaged in agricultural and real estate investment activities, including individual and family operators of farming businesses, corporate agriculture companies, financial institutions, institutional pension funds, public REITs, other real estate companies, private equity funds and other private real estate investors. These competitors may prevent us from acquiring desirable properties or may cause an increase in the price we must pay for such properties. Our competitors may adopt transaction structures similar to ours, which would decrease our competitive advantage in offering flexible transaction terms. In addition, the number of entities and the amount of funds competing for suitable investment properties may increase, resulting in increased demand and increased prices paid for these properties. If we pay higher prices for properties, our profitability may decrease, and you may experience a lower return on your investment. Our failure to identify and consummate suitable acquisitions would significantly impede our growth, which would adversely affect our results of operations and cash available for distribution to our stockholders.

Failure to succeed in new markets may have adverse consequences.

We intend to continue to acquire properties across the U.S. and may from time to time evaluate potential international acquisitions. When we acquire properties located in new geographic areas in the U.S. or internationally, or properties primarily devoted to a crop or industry with which we are less familiar (such as certain specialty crops, energy production, dairy farms or hog farms), we may face risks associated with a lack of market knowledge or understanding of the local market, including the availability and identity of quality tenants, forging new business relationships in the area, developing an understanding of a crop or industry unfamiliar to us, and unfamiliarity with local or crop-specific government requirements and procedures. Furthermore, the negotiation of a potential expansion into new markets or industries may divert management time and other resources. As a result, we may have difficulties executing our business strategy in these new markets, which could have a negative impact on our results of operations and ability to make distributions to our stockholders.

We do not intend to continuously monitor and evaluate tenant credit quality, and our financial performance may be subject to risks associated with our tenants' financial condition and liquidity position.

Certain of our leases do not require the full payment of rent in cash in advance of the planting season, which subjects us to credit risk exposure to our farm-operator tenants and the risks associated with farming operations, such as weather, commodity price fluctuations and other factors. We also are exposed to these risks with respect to leases for which the rent is based on a percentage of a tenant's farming revenues and leases with terms greater than one year. Because we do not intend to monitor and evaluate the credit risk exposure related to farm-operator tenants on an ongoing basis, we are subject

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to the risk that our tenants, particularly those that may depend on debt and leverage to finance their operations, could be susceptible to bankruptcy in the event that their cash flows are insufficient to satisfy their financial obligations, including meeting their obligations to us under their leases. As a result, we may not become aware of a tenant's financial distress until the tenant fails to make payments to us when due, which may significantly reduce the amount of time we have to evict the tenant and re-lease the farmland to a new tenant before the start of the spring planting season, and in the event of a tenant bankruptcy we may not be able to terminate the lease. If we are unable to re-lease the farmland on a timely basis, it could have a material adverse effect on our revenues.

Our short-term leases albeit an industry standard, make us more susceptible to any decreases in prevailing market rental rates than would be the case if we entered into longer-term leases, which could have a material adverse effect on our results of operations and ability to make distributions to our stockholders.

Our leases with tenants engaged in farming operations have terms customary in the farming industry, ranging mostly from twoone to three years, for row crops and one to seven years for permanent crops, with some permanent crop leases exceeding twenty years.extending up to 40 years (e.g., renewable energy leases). We expect that most of the leases we enter into in the future will have two to seven-year terms. As a result, we are required to frequently re-lease our

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properties upon the expiration of our leases, which will make us more susceptible to declines in market rental rates than we would be if we were to enter into longer term leases. As a result, any decreases in the prevailing market rental rates in the geographic areas in which we own properties could have a material adverse effect on our results of operations and ability to make distributions to our stockholders.

We may be unable to collect balances due on our leases from any tenants in financial distress or bankruptcy, which could materially and adversely affect our financial condition, results of operations and cash flow.

We are subject to tenant credit risk. Our tenants, particularly those that may depend on debt and leverage, could be susceptible to defaults under their leases or bankruptcy in the event that their cash flows are insufficient to satisfy their financial obligations. Certain of our tenants have defaulted on their lease payments, and we have been forced to pursue alternative arrangements with those tenants in order to recover amounts due under the leases. In the future, we may be forced to enter into similar alternative arrangements or pursue litigation in order to collect payments from tenants who are unable make their lease payments as they come due. We can provide no assurances that we will be able to collect the full amount due under a particular lease if we are forced to pursue alternative payment arrangements or litigation with any of our tenants.

If a bankrupt tenant rejects a lease with us, any claim we might have for breach of the lease, excluding a claim against collateral securing the lease, would be treated as a general unsecured claim. In the event of a tenant's default under its lease or its rejection of the lease in bankruptcy proceedings, we may be unable to locate a replacement tenant in a timely manner or on comparable or better terms. As a result, our financial condition, results of operations and ability to make distributions to our stockholders could be adversely affected.

We depend on external sources of capital that are outside of our control and may not be available to us on commercially reasonable terms or at all, which could limit our ability to, among other things, acquire additional properties, meet our capital and operating needs or make the cash distributions to our stockholders necessary to maintain our qualification as a REIT.

In order to maintain our qualification as a REIT, we are required under the Code to, among other things, distribute annually at least 90% of our REIT taxable income, determined without regard to the dividends paid deduction and excluding any net capital gain. In addition, we will be subject to income tax at regular corporate rates to the extent that we distribute less than 100% of our REIT taxable income, including any net capital gains. Because of these distribution requirements, we may not be able to fund future capital needs, including acquisition opportunities and principal and interest payments on any outstanding debt, from operating cash flow. Consequently, we rely on third-party sources to fund our capital needs. We may not be able to obtain such financing on favorable terms, in the time period we desire, or at all. Any debt we incur will increase our leverage, expose us to the risk of default and may impose operating restrictions on us, and

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any additional equity we raise (including the issuance of Commoncommon or preferred units) could be dilutive to existing stockholders. Our access to third-party sources of capital depends, in part, on:

general market conditions, including conditions that are out of our control, such as actions or proposed actions of the newcurrent U.S. Presidential administration and the Federal Reserve to curb inflation or the impact of future public health and safety concerns, such as the ongoing coronavirus pandemic;crises;
novel and unforeseen market volatility and trading strategies, such as the massive short squeeze-rallysqueeze-rallies caused by retail investors on retail trading platforms;
the market'smarket’s view of the quality of our assets;
the market'smarket’s perception of our growth potential;
our debt levels;
our current and expected future earnings;
our cash flow and cash distributions; and
the market price per share of our common stock and preferred stock.

If we cannot obtain capital from third-party sources, we may not be able to acquire properties when strategic opportunities exist, meet the capital and operating needs of our existing properties, satisfy our debt service obligations or make the cash distributions to our stockholders necessary to qualify and maintain our qualification as a REIT.

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Illiquidity of real estate investments could significantly impede our ability to respond to adverse changes in the performance of our properties and harm our financial condition.

The real estate investments made, and to be made, by us may be difficult to sell quickly. As a result, our ability to promptly sell one or more properties in our portfolio in response to liquidity needs, changing economic, financial and investment conditions may be limited or we may have to sell properties at a loss. In addition, we seek to opportunistically dispose of properties when we are able to do so at a price we consider attractive and/or recognize a gain on sale. Return of capital and realization of gains, if any, from an investment generally will occur upon disposition or refinancing of the underlying property. We have used dispositions of assets in the past in order to meet our liquidity requirements. If we are required to dispose of additional assets for liquidity purposes, we may be unable to realize our investment objectives by sale, other disposition or refinancing at attractive prices within any given period of time or may otherwise be unable to complete any exit strategy. Opportunities to dispose of assets at a gain may not be available to us, which would reduce our cash on hand for stock repurchases, distributions to stockholders, or for any other purpose. In particular, weakness in or even the lack of an established market for a property, changes in the financial condition or prospects of prospective purchasers, changes in national or international economic conditions and changes in laws, regulations or fiscal policies of jurisdictions in which the property is located, in each case may limit our ability to dispose of a property.

In addition, the Code imposes restrictions on a REIT'sREIT’s ability to dispose of properties that are not applicable to other types of real estate companies. In particular, the tax laws applicable to REITs effectively require that we hold our properties for investment, rather than primarily for sale in the ordinary course of business, which may cause us to forego or defer sales of properties that otherwise would be in our best interests. Moreover, if we acquire properties from C corporations (i.e., corporations generally subject to full corporate-level tax) in certain non-taxable transactions, as we have done in the past, built-in gain recognized on the non-taxable disposition of such properties within 5 years of our acquisition will be subject to tax at the highest applicable U.S. federal corporate income tax rate. Therefore, we may not be able to vary our portfolio in response to economic or other conditions promptly or on favorable terms.

Some state laws prohibit or restrict the ownership of agricultural land by business entities, which could impede the growth of our portfolio and our ability to diversify geographically.

Certain states, including Iowa, North Dakota, South Dakota, Minnesota, Oklahoma, Wisconsin, Missouri and Kansas, in which a substantial amount of primary crop farmland is located, have laws that prohibit or restrict to varying degrees the ownership of agricultural land by corporations or business entities like us. As of December 31, 2020,2023, we owned 1,959320 acres of farmland in Kansas, 815 acres in Missouri and 1,6902,114 acres in South Dakota,Oklahoma, and our ownership of those farms may be challenged under Kansas, Missouri or South DakotaOklahoma law, in which case we may be required to sell those farms at an unfavorable time and on unfavorable terms. Additional states may, in the future, pass similar or more restrictive laws, and we may not be legally permitted, or

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it may become overly burdensome or expensive, to acquire properties in these states, which could impede the growth of our portfolio and our ability to diversify geographically in states that might otherwise have attractive investment opportunities.

Our farms are subject to adverse weather conditions, seasonal variability, crop disease and other contaminants, natural disasters and other natural conditions, including the effects of climate change and water availability, which may adversely affect the amount of variable rent or income from direct operations and/or our tenants' ability to pay fixed or variable rent and thereby have a material adverse effect on our results of operations, financial condition, and our ability to make distributions to stockholders.

Crops are vulnerable to adverse weather conditions, including windstorms, tornados, floods, drought and temperature extremes, which are common but difficult to predict.predict, and may occur with higher frequency or be even less predictable in the future due to the effects of climate change. Unfavorable growing conditions can reduce both crop yield and quality. Seasonal factors, including supply and consumer demand, may also have an effect on the value of crops grown by our tenants. In extreme cases, entire harvests may be lost in some geographic areas.

In addition, crops are vulnerable to disease and pests. Damages to tenants'tenants’ crops may vary in severity and effect, depending on the stage of production at the time of infection or infestation, the type of treatment applied and climatic conditions. The costs to control these infestations vary depending on the severity of the damage and the extent of the

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plantings affected. These infestations can increase the costs and decrease the revenues of our tenants. Tenants may also incur losses from product recalls, fines or litigation due to other contaminants that may cause food borne illness. It is difficult to predict the occurrence or severity of such product recalls, fines or litigation as well as their impact upon our tenants.

We are particularly susceptible to adverse weather conditions (such as windstorms, tornados, floods, drought, hail and temperature extremes), transportation conditions (including navigation of the Mississippi River), crop disease, pests and other adverse growing conditions in California, Illinois, North Carolina, Colorado and Arkansas, which generate a significant portion of our revenues.

While many of our leases are on a fixed-rent basis that does not change based on the success of the farming operations, we also utilize variable-rent leases pursuant to which the amount of the rent depends on crop yields and prices in regions where such arrangements are prevalent. Adverse weather conditions, seasonal variability, crop disease, pests and contaminants, natural disasters and other natural conditions, including the effects of climate change, could adversely affect the value of production on properties. This could impact our variable rent proceeds and our tenants' ability to continue to meet their obligations to us. This could have a material adverse effect on the value of our properties, our results of operations, financial condition, and our ability to make distributions to our stockholders.

For example, our tenants’ profitability and, to some degree, our variable rent revenue were negatively impacted by extreme weather events in 2019 and 2020. Specifically, hurricane Michael affected our pecan farms in Alabama and Georgia, and excess rainfall affected several row crop farms in the Corn Belt, Delta and South, and Southeast regions. Furthermore, a heat wave affected an avocado farm in California, with a negative impact on 2019 revenue, an early season freeze in Michigan damaged a large portion of our blueberry crop, which had a negative impact on 2020 crop sales, and long periods of dense smoke from the wildfires this summer in California damaged wine grapes on one of our vineyards, which had an adverse impact on 2020 crop share revenue.

The market prices of the crops that our tenants may produce on our agricultural properties have exhibited periods of volatility, which may affect our tenants' ability to pay rent and thereby have a material adverse effect on our results of operations and our ability to make distributions to stockholders.

The value of a crop is affected by many factors that can differ on a yearly basis. The unpredictability of weather and crop yields in the major crop production regions worldwide creates a significant risk of price volatility, which may either increase or decrease the value of the crops that our tenants produce each year. Other material factors adding to the volatility of crop prices are changes in government regulations and policy, fluctuations in global prosperity, fluctuations in foreign trade and export markets, and eruptions of military conflicts or civil unrest. Although rental payments under the majority of our leases typically are not based on the quality or profitability of our tenants' harvests, any of these factors could adversely affect our tenants' ability to meet their obligations to us and our ability to lease or re-lease properties on favorable terms, or at all, which could have a material adverse effect on the value of our properties, our results of operations and our ability to make distributions to our stockholders.

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The impacts of trade disputes and geopolitical conflicts, such as the ongoing war in Ukraine and in the Middle East, could adversely affect the profitability of our tenants’ farming operations, which could have a material adverse effect on our results of operations, financial condition, ability to make distributions to our stockholders and the value of our properties.

The increased intensity and scope ofpotential for trade disputes between the United States and its primary agricultural trade partners havehas increased in recent years. This impacts the volatility of the market prices of certain crops that our tenants grow on our properties, and have strengthened the relative competitiveness of other countries producing the same crops. As a result, U.S. agricultural exports after phases of heightened trade tensions may not recover to prior levels. In addition, it is not clear whether the Biden administration will continue the trade policies of the Trump administration, or whether newly enacted trade policies will be effective at promoting agricultural exports.properties. There can be no assurances as to the impact of any change in trade policy on market prices of crops.

Similarly, our and our tenants’ operations are subject to risks stemming from geopolitical conflicts, such as the ongoing war in Ukraine and the conflict in the Middle East. Food prices were at near record highs before the beginning of the war in Ukraine and have increased as a result of the war. U.S. farmers have seen increased profitability as a result of rising prices. However, we can provide no assurances that this increased profitability is sustainable in light of inflationary pressures on farming costs, rising interest rates and other economic factors or that such increase will result in commensurate increases in rental rates.

A reduction in crop prices could adversely affect the profitability of our tenants and negatively impact their ability to make rental payments as they come due. If we are unable to recover the rental payments, our results of operations, financial condition and ability to make distributions to our stockholders could be materially and adversely effected.affected. If we are required to remove a tenant, we may not be able to re-lease the property at current rental rates or at all. Furthermore, prolonged trade disputes or geopolitical conflicts that lead to a continuation of depressed crop prices could materially and adversely affect the underlying value of our properties.

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Adverse changes in government policies related to farming could affect the prices of crops and the profitability of farming operations, which could materially and adversely affect the value of our properties and our results of operations.

There are a number of government programs that directly or indirectly affect the profitability of farm operators. These include marketing, export, renewable fuel and insurance policies and programs. Significant changes to or the elimination of programs and policies could adversely affect crop prices and the profitability of farming operations, which could materially and adversely impact the value of our farms and our ability to lease them on favorable terms, or at all, which would have a material adverse effect on our results of operations.

If the U.S. Federal ReserveWe may be subject to unknown or other central banks embark on a substantial tightening of monetary policycontingent liabilities related to acquired properties and properties that we may acquire in the future, that causes real interest rates to rise substantially, it may cause land prices to decline if the rise in interest rates is not accompanied by rises in the general levels of inflation.

A substantial tightening of monetary policy by the U.S. Federal Reserve or other central banks would increase credit costs (through the resulting increase in interest rates) and decrease credit availability. Thiswhich could hurt farm operators because higher real interest rates (which is defined as nominal interest rates minus the inflation rate) make it more difficult for farm operators to qualify for loans and increase their borrowing costs. Higher interest rates also tend to decrease U.S. and world economic growth, thus decreasing the demand for agricultural commodities.

All of these consequences could reduce farm income. If increases in real interest rates are not accompanied by higher levels of farm income and rents, this could lead to declines in agricultural land values and a reduction in our profitability, either of which would have a material adverse effect on us.

Properties that we have acquired, and properties that we may acquire in the future, may be subject to unknown or contingent liabilities (for example, environmental or related liabilities or liabilities related to water usage) for which we may have no recourse, or only limited recourse, against the sellers. In general, the representations and warranties provided under the transaction agreements related to the purchase of properties that we acquire may not survive the completion of the transactions. Furthermore, indemnification under such agreements may be limited and subject to various materiality thresholds, a significant deductible or an aggregate cap on losses. As a result, there is no guarantee that we will recover any amounts with respect to losses due to breaches by the sellers of their representations and warranties. In addition, the total amount of costs and expenses that may be incurred with respect to liabilities associated with these properties may exceed our business or resultsexpectations, and we may experience other unanticipated adverse effects, all of operations, financial condition,which may materially and ability to make distributions to our stockholders.adversely affect us.

The loss of key management personnel, particularly Paul A. Pittman and Luca Fabbri, could have a material adverse effect on our ability to implement our business strategy and to achieve our investment objectives.

Our future success depends to a significant extent on the continued service and coordination of our senior management team, which is comprised of Paul A. Pittman, our Executive Chairman and Chief Executive Officer and Luca Fabbri, our Chief Financial Officer.team. We can provide no assurances that any of our key personnel will continue their employment with us. TheIn particular, the loss of the services of Messrs.Mr. Paul A. Pittman, our Executive Chairman of the Board of Directors, or Mr. Luca Fabbri, our President, Chief Executive Officer and Fabbria member of our Board of Directors, could have a material adverse effect on our ability to implement our business strategy and to achieve our investment objectives.

The sale of properties to the opportunity zone fund (“OZ Fund”) may not occur on the expected timeline, and we may not achieve the anticipated benefits from our relationship with the OZ Fund.

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While the closing of the sale of first six farms to the OZ Fund has been completed, we expect an additional six farms to be sold prior to June 30, 2021. We can provide no assurances that any additional sales of properties to the OZ Fund will occur on the expected timeline or at all. If the sales of additional properties to the OZ Fund do not occur, our liquidity will be negatively impacted. Furthermore, we can provide no assurances that the OZ Fund will be successful in raising additional capital and acquiring additional farmland, either from us or from third parties. If the OZ Fund does not increase in scale, we may not experience the anticipated benefits from our relationship with the OZ Fund. For instance, we may not realize the amount of management fees we expect receive from our relationship with the OZ Fund, and our future cash flow could be adversely impacted. Farmland Partners Inc. will have no role in the management of the OZ Fund itself.

Joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on co-venturers’ financial condition and disputes between us and our co-venturers.

InWe have entered into joint investments (including our ownership interest in the OZ Fund) and may in the future, we may co-invest with third parties through partnerships, joint ventures or other entities, acquiring noncontrolling interests in or sharing responsibility for developing properties and managing the affairs of a property, partnership, joint venture or other entity. With respect to any such arrangement orour ownership interest in the OZ Fund and any similar arrangementarrangements that we may enter into in the future, we are not, and in the future may not be, in a position to exercise soleany decision-making authority regarding the property, partnership, joint venture or other entity. InvestmentsSuch joint investments in partnerships, joint ventures or other entities may, under certain circumstances, involve risks not otherwise present wherewith a third party is not involved,direct investment in farmland properties, including the possibility that partners or co-venturers might become bankrupt or fail to fund their share of required capital contributions. Partners or co-venturers may have economic or other business interests or goals which are inconsistent with our business interests or goals and may be in a position to take actions contrary to our policies or objectives, and they may have competing interests in our markets that could create conflicts of interest. Such investments may also have the potential risk of impasses on decisions, such as a sale or financing, because neither we nor the partner(s) or co-venturer(s) would have full control over the partnership or joint venture. In addition, a sale or transfer by us to a third party of our interests in the joint venture may be subject to consent rights or rights of first refusal, in favor of our joint venture partners, which would in each case restrict our ability to dispose of our interest in the joint venture. Where we are a limited partner or non-managing member in any partnership or limited liability company, if such entity takes or expects to take actions that could jeopardize our status as a REIT or require us to pay tax, we may be forced to dispose of our interest in such entity. Disputes

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between us and partners or co-venturers may result in litigation or arbitration that would increase our expenses and prevent our officers and directors from focusing their time and effort on our business. Consequently, actions by or disputes with partners or co-venturers might result in subjecting properties owned by the partnership or joint venture to additional risk. In addition, we may in certain circumstances be liable for the actions of our third-party partners or co-venturers. Our joint ventures may be subject to debt and, during periods of volatile credit markets, the refinancing of such debt may require equity capital calls.

We may fail to realize some or all of the anticipated benefits of our ownership interest in the OZ Fund, our long-term management agreement with the OZ Fund, the acquisition of MWA and the launch of a joint asset management platform with MWA, or those benefits may take longer to realize than expected. We may also encounter significant difficulties in managing the business and operations of OZ Fund and MWA client properties. The future results of our Company will continue to incur costs as a resultsuffer if we do not effectively manage properties on behalf of being a public company.the OZ Fund and MWA clients.

AsOur ability to realize the anticipated benefits of our ownership interest in the OZ Fund, our long-term management agreement with the OZ Fund, the acquisition of MWA and the asset management platform within MWA depends, in part, on our ability to successfully manage the business and operations of OZ Fund and MWA client properties. Following the consummation of the long-term management agreement with the OZ Fund and the acquisition of MWA, the number of acres of third-party farmland under our management increased significantly. If we fail to operate these business lines successfully, we may suffer losses.

Furthermore, our ownership interest in the OZ Fund, the acquisition of MWA and our management of OZ Fund and MWA client properties could expose us to unknown or contingent liabilities that were not discovered during the course of due diligence. These liabilities could include exposure to unexpected environmental problems, compliance and regulatory violations, key employee and client retention problems and other problems that could result in significant costs to us. Many of these factors are outside our control, and any one of them could result in increased costs and liabilities, decreases in the amount of expected revenues, earnings and cash flows, and diversion of management’s time and energy, which could have a public company,material adverse effect on the business of the OZ Fund, MWA and/or us. All of these factors could negatively impact the asset management fees we expect to continue to incur significant legal, accounting, insurance,earn from the management of OZ Fund and other expenses thatMWA client properties and the returns we did not incur asanticipate receiving from our ownership interest in the OZ Fund and the acquisition of MWA, all of which could negatively impact the price of our common stock, or have a private company, including costs associated with public company reporting requirements. The expenses incurred by public companies generally for reportingmaterial adverse effect on our business, financial condition and corporate governance purposes have been increasing. We expect compliance with these public reporting requirements and associated rules and regulations to increase expenses, particularly now that we are no longer an emerging growth company, although we are currently unable to estimate these costs with any degreeresults of certainty. operations.

We are exposed to risks associated with the management of third-party owned farmland and ancillary agricultural business activities and failure to succeed in new markets and these new lines of business may have adverse consequences.

Through our long-term management agreement with the OZ Fund, property management business activity within MWA and our November 2022 purchase of land and buildings for four agriculture equipment dealerships in Ohio leased to Ag Pro under the John Deere brand, we engage in property management activities on behalf of third-party property owners and lease out new agricultural-related properties, and may continue to pursue similar strategic activities if appropriate opportunities arise. Our historical experience in our existing markets in acquiring, owning and leasing farmland does not ensure that we will be able to operate successfully in new markets or in new lines of business. We may be exposed to a variety of risks when we enter a new market, property management opportunity or ancillary agricultural business activity, including an inability to accurately evaluate local market conditions and a lack of familiarity with local tenants. We may be unsuccessful in managing farmland properties on behalf of third-parties or leasing out agricultural equipment dealerships, which could have a material adverse effect on our results of operations and we may be liable and/or our status as a REIT may be jeopardized if the third-party farmland management or agricultural equipment dealership facilities cause us to fail to comply with various tax or other regulatory matters.

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If we fail to maintain effective internal controls over financial reporting, we may not be able to accurately report our financial results, which may adversely affect investor confidence in our companyCompany and, as a result, the value of our common stock.

Our management is responsible for establishing and maintaining adequate internal controls over financial reporting. While our Annual Report on Form 10-K for the year ended December 31, 2019 contained an independent auditor’s attestation report pursuant to Section 404404(b) of the Sarbanes-Oxley Act of 2002, as amended (the “Sarbanes-Oxley Act”), we are not required to include such an audit report in this Annual Report. In connection with our 2019 audit, our independent registered public accounting firmWe have identified and communicated a material weakness related toweaknesses in the failure of management to timely comply with compensating controls with respect to the separation of duties in our accounting IT systems.past. While we believe we have remediated thisall past material weakness,weaknesses, we cannot give any assurances that other material weaknesses will

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not be identified in the future in connection with our compliance with the provisions of Section 404 of the Sarbanes-Oxley Act. The existence of any material weakness would preclude a conclusion by management and our independent auditors that we maintained effective internal control over financial reporting. Our management may be required to devote significant time and expense to remediate any material weaknesses that may be discovered and may not be able to remediate any material weakness in a timely manner. The existence of any material weakness in our internal control over financial reporting could also result in errors in our financial statements that could require us to restate our financial statements, cause us to fail to meet our reporting obligations and cause investors to lose confidence in our reported financial information, all of which could lead to a decline in the per-share trading price of our common stock. In addition, at the time we no longer qualify as a smaller reporting company, we will be required to include an auditor attestation report pursuant to Section 404 of the Sarbanes Oxley Act, which will cause us to incur additional expenses, which may be significant.

Under the FPI Loan Program, we provide loans to third-party farmers, which exposes us to risks associated with being a lender, including the risk that borrowers default on their obligations to us, which could adversely affect our results of operations and financial condition.

Under the FPI Loan Program, we make loans to third-party farmers (both tenant and non-tenant) to provide financing for borrowers’ working capital requirements and operational farming activities, farming infrastructure projects, and for other farming and agricultural real estate related purposes. As of the date of this Annual Report on Form 10-K,December 31, 2023, we have made sevenloans to twelve distinct borrowers with original principal amounts totaling $36.7 million. These loans consist of: 15 loan agreements which were originally secured by senior secured first-lien mortgage loans secured against farmland; one loan is secured by a second mortgage secured against farmland or farm related propertiesand a personal guaranty; three loan agreements which were originally secured by working capital assets of the borrower; and one loan agreement which was originally secured against crop to farmers totaling $19.1 million, with $2.4 million outstanding atby equipment of the borrower. As of December 31, 20202023, the remaining loan balances total $13.9 million (representing less than 0.01%1% of our total assets as of December 31, 2020)2023), of which $13.4 million were secured by senior first-lien mortgages and we$0.5 million was secured by a second mortgage. We intend to make similar loans under the FPI Loan Program in the future. Payments on such loans depend on the profitable operation or management of the farmland or farmland-related property securing the loan or the maintenance of any equipment, or other assets securing the loan. The success of the farmland or farm-related property may be affected by many factors outside the control of the borrower, including adverse weather conditions that prevent the planting of a crop or limit crop yields, declines in market prices for agricultural products (both domestically and internationally) and the impact of government regulations (including changes in price supports, subsidies and environmental regulations). In addition, many farms are dependent on a limited number of key individuals whose injury or death may significantly affect the successful operation of the farm. If the cash flow from a farming operation is diminished, the borrower's ability to repay the loan may be impaired. If a borrower defaults under a loan for which we are the lender, we may attempt to foreclose on the collateral securing the loan, including by acquiring title to the subject property, crops, or equipment, to protect our investment. In response, the defaulting borrower may contest our enforcement of foreclosure or other available remedies, seek bankruptcy protection against our exercise of enforcement or other available remedies, or bring claims against us for lender liability. If a defaulting borrower seeks bankruptcy protection, the automatic stay provisions of the U.S. Bankruptcy Code would preclude us from enforcing foreclosure or other available remedies against the borrower unless relief is first obtained from the court with jurisdiction over the bankruptcy case. In addition, we may be subject to intercreditor agreements that delay, impact, govern or limit our ability to foreclose on a lien securing a loan or otherwise delay or limit our pursuit of our rights and remedies. Any such delay or limit on our ability to pursue our rights or remedies could adversely affect our business, results of operations and ability to make distributions to our stockholders. In the event of a foreclosure, we may assume direct ownership of the underlying farm. Even if we successfully foreclose on the collateral securing our mortgage loans, foreclosure-related costs, high loan-to-value ratios or

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declines in property values could prevent us from realizing the full amount of our mortgage loans, and we could be required to record a valuation allowance for such losses.

Liability for uninsured or underinsured losses could materially and adversely affect our financial condition and cash flow.

Our properties may be damaged by adverse weather conditions and natural disasters, such as earthquakes, floods and tornados.tornadoes. Our insurance may not be adequate to cover all damages or losses from these events, or we may view it as not economically prudent to purchase insurance for certain types of losses. Should an uninsured loss occur, we could lose our capital investment or anticipated profits and cash flows from one or more properties. If any such loss is insured, we may be required to pay a significant deductible on any claim for recovery of such a loss prior to our insurer being obligated to reimburse us for the loss, or the amount of the loss may exceed our coverage for the loss, which could have an adverse effect on our cash flow.

We have previously been subject to, and may in the future be subject to, litigation or threatened litigation, which may require us to pay damages and expenses or restrict the operation of our business.

We have previously been subject to, and may be subject in the future, to litigation or threatened litigation, including claims relating to the actions of our tenants, claims brought by stockholders, and otherwise in the ordinary course of business. In particular, we are subject to the risk of complaints by our tenants involving premises liability claims and alleged violations of landlord-tenant laws, which may give rise to litigation or governmental investigations, as well as claims and litigation relating to real estate rights or uses of our properties. Additionally, whether or not any dispute actually proceeds to litigation, we may be required to pay damages or expenses, which may be significant, or involve our agreement with terms that restrict the operation of our business. We generally intend to vigorously defend ourselves; however, we cannot be certain of the ultimate outcomes of pending claims against the Company or of those claims that may arise in the future. Resolution of these types of matters against us may result in our having to pay significant fines, judgments, or settlements, which, if uninsured, or if the fines, judgments, and settlements exceed insured levels, could adversely impact our earnings and cash flows, thereby having an adverse effect on our financial condition, results of operations, cash flows and our ability to pay distributions on, and the per share trading price of, our common stock. Certain litigation or the resolution of certain litigation may affect the availability or cost of some of our insurance coverage and could expose us to increased risks that would be uninsured, and/or adversely impact our ability to attract officers and directors, which could adversely impact our results of operations, cash flows and our ability to pay distributions on, and the value of, our common and preferred stock. For more information about our resolved and ongoing legal proceedings see “Note 8—Commitments and Contingencies” to our Consolidated Financial Statements included in Part IV, Item 8 of this Annual Report on Form 10-K.

We may incur significant unrecoverable costs if we are not successful in connection with the litigation we have filed against Sabrepoint.

As described in further detail in “Note 8—Commitments and Contingencies” to our Consolidated Financial Statements included in Part IV, Item 8 of this Annual Report on Form 10-K, on July 2, 2021, the Company filed a complaint against First Sabrepoint Capital Management, LP, Sabrepoint Capital Partners, LP, Sabrepoint Capital Participation, LP, George Baxter, and Donald Marchiony (collectively, “Sabrepoint”) seeking relief for Sabrepoint’s alleged role in a “short and distort scheme” to profit from an artificial decline in the Company’s stock price stemming from an article posted on Seeking Alpha, which contained numerous false statements about the Company. On December 17, 2021, the Company's claims against Sabrepoint were dismissed by the court , which granted (i) Sabrepoint's motion for summary judgment on collateral estoppel grounds, and (ii) motion to dismiss pursuant to the Texas Citizens Participation Act (“TCPA”). On March 21, 2022, after the Company filed a notice signaling an intent to appeal both orders, the Court of Appeals for the Fifth District of Texas (the “Court of Appeals”) entered an order declaring the trial court's TCPA order “VOID because the motion was denied by operation of law….” Accordingly, the Company narrowed its appeal to the trial court's grant of summary judgment. On January 26, 2022, Sabrepoint filed a motion for attorney's fees relating to the defense of that action. The trial court granted the motion for certain fees claimed by Sabrepoint as relating to its pursuit of its TCPA motion, but as noted above, the Court of Appeals subsequently overturned the TCPA order that formed the basis of Sabrepoint’s fee request, mooting the motion and the Court’s order on the same. On June 30, 2023, the Court of Appeals granted the

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Company’s appeal, determining that the Company’s claims against Sabrepoint are not barred, reversing the trial court and remanding the case for further proceedings on the merits. On October 13, 2023, Sabrepoint filed a Petition for Review with the Texas Supreme Court, requesting the court to review the Court of Appeals’ decision. The Company filed a response to the Sabrepoint Petition for Review with the Texas Supreme Court on December 27, 2023, and on February 16, 2024, the Texas Supreme Court requested a briefing on the merits. The petition is now fully briefed and pending a decision from the court. For more information see “Note 8—Commitments and Contingencies” to our Consolidated Financial Statements included in Part IV, Item 8 of this Annual Report on Form 10-K. We may not be successful in this litigation, in which case we would have incurred significant costs and expenses. Even if we are successful, there can be no assurance that we will be able to recover damages. To the extent that any such adverse effects exceed any benefits we may realize from pursuing this litigation, our business, prospects, financial condition and results of operations may suffer materially.

A cybersecurity incident and other technology disruptions could result in a violation of law or negatively impact our reputation and relationships with our tenants, any of which could have a material adverse effect on our results of operations and our financial condition.

Information and security risks have generally increased in recent years due to the rise in new technologies and the increased sophistication and activities of perpetrators of cyber-attacks. We use computers in substantially all aspects of our business operations, and we also use mobile devices and other online activities to connect with our employees and tenants. Such uses give rise to cybersecurity risks, including security breach, espionage, system disruption, theft and inadvertent release of information. We have in the past experienced cyberattacks on our computers and computer networks, and, while none to date have been material, we expect that additional cyberattacks will occur in the future. Our business involves the storage and transmission of numerous classes of sensitive and/or confidential information and intellectual property, including tenants’, suppliers’ and employees’ personally identifiable information and financial and strategic information about us.

If we fail to assess and identify cybersecurity risks associated with our operations, we may become increasingly vulnerable to such risks. Even the most well protected information, networks, systems and facilities remain potentially vulnerable because the techniques used in such attempted security breaches evolve and generally are not recognized until launched against a target, and in some cases are designed not to be detected and, in fact, may not be detected. Accordingly, we and our suppliers may be unable to anticipate these techniques or to implement adequate security barriers or other preventative measures, and thus it is impossible for us and our suppliers to entirely mitigate this risk. Further, in the future we may be required to expend additional resources to continue to enhance information security measures and/or to investigate and remediate any information security vulnerabilities. We can provide no assurances that the measures we have implemented to prevent security breaches and cyber incidents will be effective in the event of a cyber-attack.

The theft, destruction, loss, misappropriation or release of sensitive and/or confidential information or intellectual property, or interference with our information technology systems or the technology systems of third-parties on which we rely, could result in business disruption, negative publicity, violation of privacy laws, loss of tenants, potential liability and competitive disadvantage, any of which could result in a material adverse effect on financial condition or results of operations.

For more information on cybersecurity, see “Item 1C. Cybersecurity Disclosure.”

Potential liability for environmental matters could materially and adversely affect our results of operations and financial condition.

We are subject to the risk of liabilities under federal, state and local environmental laws applicable to agricultural properties, including those related to wetlands, groundwater and water runoff. Some of these laws could subject us to:

responsibility and liability for the cost of removal or remediation of hazardous substances released on our properties, generally without regard to our knowledge of or responsibility for the presence of the contaminants;
liability for the costs of investigation, removal or remediation of hazardous substances or chemical releases at disposal facilities for persons who arrange for the disposal or treatment of these substances; and

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potential liability for claims by third parties for damages resulting from environmental contaminants.

Environmental site assessments were not conducted on all the farms in our portfolio and we do not expect to conduct environment site assessments on all farms we acquire in the future. Our costs of investigation, remediation or removal of hazardous substances may be substantial. In addition, the presence of hazardous substances on one of our properties, or the failure to properly remediate a contaminated property, could adversely affect our ability to sell or lease the property or to borrow using the property as collateral. We may be subject to common law claims by third parties based on damages and costs resulting from environmental contamination emanating from the property. Additionally, we could become subject to new, stricter environmental regulations, which could diminish the utility of our properties and have a material adverse impact on our results of operations and financial condition.

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We may be required to permit the owners of certain third-party access rights on our properties to enter and occupy parts of the properties, including owners of mineral rights and power generation and transportation infrastructure, which could materially and adversely impact the rental value of our properties.

Although we own the surface rights to our farms and expect to own the surface rights to properties that we acquire in the future, other persons or entities may own third-party access rights on our properties based upon their ownership of certain minerals, power generation and transportation infrastructure or similar property rights. Some of these third-party access rights, such as those related to oil, water or natural gas may be located under the surfaces of these properties, while others, particularly those third-party access rights related to power generation and transportation infrastructure such as wind turbines or oil pipelines, may be located on or above the surfaces of these properties. For example, in connection with our acquisition of a group of farms in Colorado and Kansas, we granted the seller retained 50% of the mineral rights related to the farm. Currently there is no mineral development or significant power generation and transportation infrastructure on the farms in our portfolio other than on properties for which we own the rights, but we can provide no assurances that third parties will not assert claims for mineral rights, third-party access rights related to power generation and transportation infrastructure and other related property rights on the farms in our portfolio or that farmland that we acquire in the future will not be subject to these third-party access rights. To the extent that third parties have third-party rights on farmland that we currently own or acquire in the future, we expect that we would be required to permit third parties to enter our properties for the purpose of such activities as drilling and operating oil or gas wells, operating and maintaining oil pipelines and operating and maintaining wind turbines on the premises. We may also be required to set aside a reasonable portion of the surface area of our properties to accommodate these operations. The devotion of a portion of our properties to these operations would reduce the amount of the surface available for farming or farm-related uses. Such activities might also disrupt the productivity of the farmland or property related to farming or increase the risk of environmental liabilities, any of which could adversely impact the rents that we receive from leasing these properties.

Increases in mortgage rates or unavailability of mortgage debtWe are subject to risks associated with public health crises, such as pandemics and epidemics which may make it difficult for us to finance or refinance our debt, which could have a material adverse effect on our financial condition, resultsbusiness. The nature and extent of operations, growth prospectsfuture impacts are highly uncertain and our ability to make distributions to stockholders.unpredictable.

If mortgage debt is unavailableWe are subject to us at reasonable rates or at all, we may not be able to finance the purchase of additional properties or refinance existing debt when it becomes due. If interest rates are higher when we refinance our debt, our income and cash flow could be reduced, which would reduce cash available for distribution to our stockholders and may hinder our ability to raise more capital by issuing more stock or by borrowing more money.

Changes to the base rate on our floating rate indebtedness could increase our borrowing costs.

As of December 31, 2020, $174.4 million of our outstanding indebtedness bears interest at floating rates based on the London interbank offered rate (“LIBOR”) and has maturity dates beyond December 31, 2021. In July 2017, the United Kingdom's Financial Conduct Authority, which regulates LIBOR, announced that it will stop compelling banks to submit rates for the calculation of LIBOR after 2021. It is not possible to predict the effect of these changes, other reforms or the establishment of alternative reference rates. The discontinuation or modification of LIBOR could result in interest rate increases on our debt, which could adversely affect our cash flow, operating results and ability to make distributions to our stockholders at expected levels or at all.

The ongoing COVID-19 pandemic and measures intended to prevent its spread could have a material adverse effect on our business, results of operations, cash flows and financial condition.

       Since being first reported in December 2019, COVID-19 has spread globally, including to every state in the United States. On March 11, 2020, the World Health Organization declared COVID-19 a pandemic, and on March 13, 2020, the United States declared a national emergencyrisks associated with respect to COVID-19. The pandemic has led governments and other authorities around the world, including federal, state and local authorities in the United States, to impose measures intended to control its spread, including restrictions on freedom of movement and business operationspublic health crises, such as travel bans, border closings, business closures, quarantinespandemics and shelter-in-place orders. Many of our properties and our headquarters are located in areas that are or have been subject to shelter-in-place orders and restrictions on the types of businesses that may continue to operate.

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      The impact of the COVID-19 pandemic and measures to prevent its spread could materially and adversely affect our businesses in a number of ways.epidemics. Our rental revenue and operating results depend significantly on the ability of our tenants to meet their rent and other obligations to us. While in general our tenants’ businesses have not been materially affected, certain sectors of the agricultural industry have seen a decreased demand for their products as a result of the economic disruptions caused by COVID-19. Such decreases in demands may further exacerbate, and demand may never recover to its prior levels. For example, drastic reductions in the hospitality, entertainment and travel business volumes have significantly impacted the demand for certain agricultural products, such as lemons and blueberries. Lower oil demands tied to a reduction in vehicle miles driven have a direct impact on the demand for ethanol and therefore corn, a crop grown on a significant number of our properties. Disruptions in the global supply chain have impacted our tenants’ ability to price and sell in a timely manner certain specialty crops, such as almonds, to which we are exposed through participating rents. If the impacts of the pandemica future public health crisis continue for an extended period of time, we expect that certain tenants may experience greater financial distress, which could result in late payments, requests for rental relief, business closures, rent concessions or other accommodations, as applicable. In some cases, we may have to restructure tenants’ long-term rent obligations and may not be able to do so on terms that are as favorable to us as those currently in place. Additionally, we have negotiated variable rents with certain of our tenants, which directly exposes our rental revenues to the risk of a negative impact on our tenants’ operations as a result of COVID-19.  

      While both in-person office attendance and frequency of travel has increased compared to the beginning of the pandemic, any future extended periods of remote work arrangements could strain our business continuity plans, introduce operational risk, including but not limited to cybersecurity risks, and impair our ability to manage our business.

The COVID-19 pandemic has also caused, and is likely to continue to cause, severe economic, market and other disruptions worldwide. We may be impacted by stock market volatility and illiquid market conditions, global economic uncertainty, and the perceived prospect for capital appreciation in real estate. We cannot assure you that conditions in the bank lending, capital and other financial markets will not continue to deteriorate as a result of the pandemic, or that our access to capital and other sources of funding will not become constrained, which could adversely affect the availability and terms of future borrowings, renewals or refinancings. In addition, the deterioration of global economic conditions as a result of the pandemic may ultimately decrease occupancy levels and rents across our portfolio as tenants and residents reduce or defer their spending, which could adversely affect the value of our properties.

The extentscope and duration of any future public health crisis, including the potential emergence of new variants of the COVID-19 pandemic’s effect on our operationalvirus, the pace at which government restrictions are imposed and financial performance will depend on future developments, includinglifted, the duration, spread and intensityscope of the pandemic, the timing and effectiveness of vaccines and other treatments, possible resurgences in COVID-19 cases, and the duration and effectiveness of government measuresadditional actions taken to mitigate the pandemic, allspread of which are uncertaindisease, global vaccination and difficult to predict. Due tobooster rates, the speed withand extent to which global markets and utilization rates for our products fully recover from the situation is developing, we are not able at this time to estimatedisruptions caused by such a public health crisis, and the effectimpact of these factors on our business, but the adverse impact on our business,financial condition and results of operations, financial conditionwill depend on future developments that are highly uncertain and cash flows couldcannot be material.predicted with confidence.

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To the extent public health crises adversely affect our operations and global economic conditions more generally, it may also have the effect of heightening many of the other risks described herein.

Risks Related to Our Organizational Structure

We may be subject to unknown or contingent liabilities related to acquired properties and properties that we may acquire in the future, which could have a material adverse effect on us.

Properties that we have acquired, and properties that we may acquire in the future, may be subject to unknown or contingent liabilities for which we may have no recourse, or only limited recourse, against the sellers. In general, the representations and warranties provided under the transaction agreements related to the purchase of properties that we acquire may not survive the completion of the transactions. Furthermore, indemnification under such agreements may be limited and subject to various materiality thresholds, a significant deductible or an aggregate cap on losses. As a result, there is no guarantee that we will recover any amounts with respect to losses due to breaches by the sellers of their representations and warranties. In addition, the total amount of costs and expenses that may be incurred with respect to liabilities associated with these properties may exceed our expectations, and we may experience other unanticipated adverse effects, all of which may materially and adversely affect us.

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Conflicts of interest may exist or could arise in the future between the interests of our stockholders and the interests of holders of units in our operating partnership,Operating Partnership, which may impede business decisions that could benefit our stockholders.

Although holders of our Common units do not have voting rights or the power to direct the Company’s affairs, there could be potential conflicts, conflicts of interest may exist or could arise in the future as a result of the relationships between us and our affiliates, on the one hand, and our operating partnershipOperating Partnership or any partner thereof.

Our directors and officers have duties to our company under Maryland law in connection with their management of our company.Company. At the same time, our wholly owned subsidiary, Farmland Partners OP GP, LLC, as the general partner of our operating partnership,Operating Partnership, has fiduciary duties and obligations to our operating partnershipOperating Partnership and its limited partners under Delaware law and the partnership agreement in connection with the management of our operating partnership.Operating Partnership. The general partner's fiduciary duties and obligations as the general partner of our operating partnershipOperating Partnership may come into conflict with the duties of our directors and officers to our company.Company. These conflicts of interest could lead to decisions that are not in the best interests of the Company and its stockholders.

Unless otherwise provided for in a partnership agreement, Delaware law generally requires a general partner of a Delaware limited partnership to adhere to fiduciary duty standards under which it owes its limited partners the highest duties of good faith, fairness and loyalty and which generally prohibit such general partner from taking any action or engaging in any transaction as to which it has a conflict of interest. The partnership agreement provides that, in the event of a conflict between the interests of the limited partners of our operating partnership,Operating Partnership, on the one hand, and the separate interests of our stockholders, on the other hand, the general partner, in its capacity as the general partner of our operating partnership,Operating Partnership, shall act in the interests of our stockholders and is under no obligation to consider the separate interests of the limited partners of our operating partnershipOperating Partnership in deciding whether to cause our operating partnershipOperating Partnership to take or not to take any actions. The partnership agreement further provides that any decisions or actions not taken by the general partner in accordance with the partnership agreement will not violate any duties, including the duty of loyalty, that the general partner, in its capacity as the general partner of our operating partnership,Operating Partnership, owes to our operating partnershipOperating Partnership and its partners.

Additionally, the partnership agreement provides that the general partner will not be liable to our operating partnershipOperating Partnership or any partner for monetary damages for losses sustained, liabilities incurred or benefits not derived by our operating partnershipOperating Partnership or any limited partner unless the general partner acted in bad faith and the act or omission was material to the matter giving rise to the loss, liability or benefit not derived. Our operating partnershipOperating Partnership must indemnify the general partner, us, our directors and officers, officers of our operating partnershipOperating Partnership and others designated by the general partner from and against any and all claims that relate to the operations of our operating partnership,Operating Partnership, unless (1) an act or omission of the indemnified person was material to the matter giving rise to the action and either was committed in bad faith or was the result of active and deliberate dishonesty, (2) the indemnified person actually received an improper personal benefit in money, property or services or (3) in the case of a criminal proceeding, the indemnified person had reasonable cause to believe that the act or omission was unlawful. Our operating partnershipOperating Partnership must also pay or reimburse the reasonable expenses of any such person upon its receipt of a written affirmation of the person's good faith belief that the standard of conduct necessary for indemnification has been met and a written undertaking to repay any amounts paid or advanced if it is ultimately determined that the person did not meet the standard of conduct for indemnification. Our operating partnershipOperating Partnership will not indemnify or advance funds to any person with respect to any action initiated by the person seeking indemnification without our approval (except for any proceeding brought to enforce such person's right to indemnification under the partnership agreement) or if the person is found to be liable to our operating partnershipOperating Partnership on any portion of any claim in the action. No reported decision of a Delaware appellate court has interpreted provisions similar to the provisions of the partnership agreement that modify and reduce our fiduciary duties or obligations as the sole member of the general partner or reduce or eliminate our liability for money damages to our operating partnershipOperating Partnership and its partners, and we have not obtained an opinion of counsel as to the enforceability of the provisions set forth in the partnership

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agreement that purport to modify or reduce the fiduciary duties that would be in effect were it not for the partnership agreement.

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Our charter contains certain provisions restricting the ownership and transfer of our stock that may delay, defer or prevent a change of control transaction that might involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests.

Our charter contains certain ownership limits with respect to our stock. Our charter, among other restrictions, prohibits the beneficial or constructive ownership by any person of more than 9.8% in value or number of shares, whichever is more restrictive, of the outstanding shares of any class or series of our stock, excluding any shares that are not treated as outstanding for U.S. federal income tax purposes. Our Board of Directors, in its sole and absolute discretion, may exempt a person, prospectively or retroactively, from this ownership limit if certain conditions are satisfied. This ownership limit as well as other restrictions on ownership and transfer of our stock in our charter may:

discourage a tender offer or other transactions or a change in management or of control that might involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests; and
result in the transfer of shares acquired in excess of the restrictions to a trust for the benefit of a charitable beneficiary and, as a result, the forfeiture by the acquirer of certain of the benefits of owning the additional shares.

We could increase the number of authorized shares of stock, classify and reclassify unissued stock and issue stock without stockholder approval, which may delay, defer or prevent a transaction that our stockholders believe to be in their best interests.

Our Board of Directors, without stockholder approval, has the power under our charter to amend our charter to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that we are authorized to issue. In addition, under our charter, our Board of Directors, without stockholder approval, has the power to authorize us to issue authorized but unissued shares of our common stock or preferred stock and to classify or reclassify any unissued shares of our common stock or preferred stock into one or more classes or series of stock and set the preference, conversion or other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications or terms or conditions of redemption for such newly classified or reclassified shares. As a result, we may issue series or classes of common stock or preferred stock with preferences, dividends, powers and rights, voting or otherwise, that are senior to, or otherwise conflict with, the rights of holders of our common stock. Although our Board of Directors has no such intention at the present time, it could establish a class or series of preferred stock that could, depending on the terms of such series, delay, defer or prevent a transaction or a change of control that might involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests.

Certain provisions of Maryland law could inhibit changes in control, which may discourage third parties from conducting a tender offer or seeking other change of control transactions that could involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests.

Certain provisions of the Maryland General Corporation Law or the MGCL,(the “MGCL”) may have the effect of inhibiting a third party from making a proposal to acquire us or of impeding a change of control under certain circumstances that otherwise could provide the holders of shares of our common stock with the opportunity to realize a premium over the then-prevailing market price of such shares, including:

"business combination"combination” provisions that, subject to limitations, prohibit certain business combinations between us and an "interested stockholder"“interested stockholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our outstanding voting stock or any affiliate or associate of ours who, at any time within the two-year period immediately prior to the date in question, was the beneficial owner of 10% or more of the voting power of our then outstanding stock) or an affiliate thereof for five years after the most recent date on which the stockholder becomes an interested stockholder and thereafter impose fair price and/or supermajority voting requirements on these combinations; and 
"control share"share” provisions that provide that "control shares"“control shares” of our companyCompany (defined as shares which, when aggregated with other shares controlled by the stockholder, except solely by virtue of a revocable proxy, entitle

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the stockholder to exercise one of three increasing ranges of voting power in electing directors) acquired in a "control“control share acquisition"acquisition” (defined as the direct or indirect acquisition of ownership or control of issued and outstanding "control shares"“control shares”) have no voting rights with respect to their control shares except to the extent

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approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares.

By resolution of our Board of Directors, we have opted out of the business combination provisions of the MGCL and provided that any business combination between us and any other person is exempt from the business combination provisions of the MGCL, provided that the business combination is first approved by our Board of Directors (including a majority of directors who are not affiliates or associates of such persons). In addition, pursuant to a provision in our bylaws, we have opted out of the control share provisions of the MGCL. However, our Board of Directors may by resolution elect to opt in to the business combination provisions of the MGCL and we may, by amendment to our bylaws, opt in to the control share provisions of the MGCL in the future.

Additionally, certain provisions of the MGCL permit our Board of Directors, without stockholder approval and regardless of what is currently provided in our charter or our bylaws, to implement takeover defenses, some of which (for example, a classified board) we do not currently employ. These provisions may have the effect of inhibiting a third party from making an acquisition proposal for our companyCompany or of delaying, deferring, or preventing a change in control of our companyCompany under circumstances that otherwise could provide the holders of our common stock with the opportunity to realize a premium over the then-current market price. Our charter contains a provision whereby we elect to be subject to the provisions of Title 3, Subtitle 8 of the MGCL relating to the filling of vacancies on our Board of Directors.

Our charter, our bylaws and Maryland law also contain other provisions, including the provisions of our charter on removal of directors and the advance notice provisions of our bylaws, that may delay, defer, or prevent a transaction or a change of control that might involve a premium price for our common stock or otherwise be in the best interest of our stockholders.

Certain provisions in the partnership agreement may delay or prevent unsolicited acquisitions of us.

Provisions in the partnership agreement may delay, or make more difficult, unsolicited acquisitions of us or changes of our control. These provisions could discourage third parties from making proposals involving an unsolicited acquisition of us or change of our control, although some of our stockholders might consider such proposals, if made, desirable. These provisions include, among others:

redemption rights;
a requirement that the general partner may not be removed as the general partner of our operating partnershipOperating Partnership without our consent;
transfer restrictions on Common units;
our ability, as general partner, in some cases, to amend the partnership agreement and to cause our operating partnershipOperating Partnership to issue units with terms that could delay, defer or prevent a merger or other change of control of us or our operating partnershipOperating Partnership without the consent of the limited partners; and
the right of the limited partners to consent to direct or indirect transfers of the general partnership interest, including as a result of a merger or a sale of all or substantially all of our assets, in the event that such transfer requires approval by our common stockholders.

Our Board of Directors may change our strategies, policies and procedures without stockholder approval.

Our investment, financing, leverage and distribution policies, and our policies with respect to all other activities, including growth, capitalization and operations, are determined exclusively by our Board of Directors, and may be amended or revised at any time by our Board of Directors without notice to or a vote of our stockholders. This could result in us conducting operational matters, making investments or pursuing different business or growth strategies than those contemplated in this Annual Report on Form 10-K. Further, our charter and bylaws do not limit the amount or percentage of indebtedness, funded or otherwise, that we may incur. Our Board of Directors may alter or eliminate our current policy on borrowing at any time without stockholder approval. If this policy changed, we could become more highly leveraged

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which could result in an increase in our debt service. Higher leverage also increases the risk of default on our obligations. In addition, a change in our investment policies, including the manner in which we allocate our resources across our portfolio or the types of assets in which we seek to invest, may increase our exposure to interest rate risk, real estate market

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fluctuations and liquidity risk. Changes to our policies with regards to the foregoing could materially adversely affect our financial condition, results of operations and cash flow.

Our rights and the rights of our stockholders to take action against our directors and officers are limited, which could limit your recourse in the event that we take certain actions which are not in our stockholders' best interests.

Maryland law provides that a director or officer has no liability in that capacity if he or she performs his or her duties in good faith, in a manner that he or she reasonably believes to be in our best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances. Under the MGCL, directors are presumed to have acted with this standard of care. As permitted by Maryland law, our charter eliminates the liability of our directors and officers to us and our stockholders for money damages, except for liability resulting from:

actual receipt of an improper benefit or profit in money, property or services; or
active and deliberate dishonesty by the director or officer that was established by a final judgment as being material to the cause of action adjudicated.

Our charter and bylaws obligate us to indemnify each present and former director or officer, to the maximum extent permitted by Maryland law, in the defense of any proceeding to which he or she is made, or threatened to be made, a party by reason of his or her service to us. In addition, we may be obligated to advance the defense costs incurred by our directors and officers. We also have entered into indemnification agreements with our officers and directors granting them express indemnification rights. As a result, we and our stockholders may have more limited rights against our directors and officers than might otherwise exist absent the current provisions in our charter, bylaws and indemnification agreements or that might exist for other public companies.

Our charter contains provisions that make removal of our directors difficult, which could make it difficult for our stockholders to effect changes to our management.

Our charter contains provisions that make removal of our directors difficult, which could make it difficult for our stockholders to effect changes to our senior management and may prevent a change in control of our companyCompany that is in the best interests of our stockholders. Our charter provides that a director may only be removed for cause upon the affirmative vote of holders of two-thirds of all the votes entitled to be cast generally in the election of directors. Vacancies may be filled only by a majority of the remaining directors in office, even if less than a quorum. These requirements make it more difficult to change our senior management by removing and replacing directors and may prevent a change in control of our companyCompany that is in the best interests of our stockholders.

Our operating partnershipOperating Partnership may issue additional Common units or one or more classes of preferred units to third parties without the consent of our stockholders, which would reduce our ownership percentage in our operating partnershipOperating Partnership and could have a dilutive effect on the amount of distributions made to us by our operating partnershipOperating Partnership and, therefore, the amount of distributions we can make to our stockholders.

As of the date of this Annual Report on Form 10-K,December 31, 2023, we owned approximately 95.4%97.6% of the outstanding Common units in our operating partnershipOperating Partnership (on a fully diluted basis). Since our initial public offering, we have issued a total of 8.0 million Common units and a total of 117,000 Series A preferred units as consideration in connection with our acquisition of properties, and we may issue additional Common units and Series A preferred units of one or more classes in connection with our acquisition of properties, as compensation or otherwise. Such issuances would reduce our ownership percentage in our operating partnershipOperating Partnership and could affect the amount of distributions made to us by our operating partnershipOperating Partnership and, therefore, the amount of distributions we can make to our stockholders. Our common stockholders do not have any voting rights with respect to any such issuances or other partnership level activities of our operating partnership.Operating Partnership.

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Certain aspects of our Series A preferred units and Series B Participating Preferred Stock may limit our ability to make distributions to our common stockholders.

The distribution ratesrate on our Series A preferred units and Series B Participating Preferred Stock areis fixed, and no distributions can be paid to our common stockholders unless we have paid all cumulative dividends on our Series A

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preferred units and Series B Participating Preferred Stock.units. The distribution preference of our Series A preferred units and Series B Participating Preferred Stock could materially and adversely affect our cash flow and ability to make distributions to our common stockholders.

In addition to the fixed payments on our Series A preferred units and Series B Participating Preferred Stock, holders of our Series B Participating Preferred Stock may receive a Farmland Value Appreciation (“FVA”) payment that represents the cumulative change from the 2017 estimated average value per acre of farmland in the 17 states in which we owned farmland as of June 30, 2017 weighted by the percentage of the total unaudited book value of our properties held in each of the 17 states in which we owned farmland as of June 30, 2017. The FVA payment may be realized by a holder of Series B Participating Preferred Stock only upon (i) the exercise of our optional redemption right or conversion right after September 30, 2021 but prior to September 30, 2024, (ii) any conversion or redemption in connection with a change in control or (iii) the liquidation, dissolution or winding up of the Company. Any of these events could occur during a time in which the FVA amount has substantially appreciated from its 2017 level, which may require a significant distribution from the Company to holders of Series B Participating Preferred Stock, and could materially and adversely affect our cash available to make distributions to our common stockholders. Further, in addition to the FVA amount, if a redemption or liquidation occurs on or before September 30, 2021, we will be required to pay a premium amount that is calculated based on the FVA amount, which could further reduce our cash available to make distributions to our common stockholders.

U.S. Federal Income Tax Risks

Failure to maintain qualification as a REIT for U.S. federal income tax purposes would subject us to U.S. federal income tax on our taxable income at regular corporate rates, which would substantially reduce our ability to make distributions to our stockholders.

We elected to be taxed as a REIT for U.S. federal income tax purposes beginning with our short taxable year ended December 31, 2014. To maintain qualification as a REIT, we must meet various requirements set forth in the Code concerning, among other things, the ownership of our outstanding stock, the nature of our assets, the sources of our income and the amount of our distributions. The REIT qualification requirements are extremely complex, and interpretations of the U.S. federal income tax laws governing qualification as a REIT are limited. We believe that our current organization and method of operation will enable us to continue to qualify as a REIT. However, at any time, new laws, interpretations or court decisions may change the U.S. federal tax laws relating to, or the U.S. federal income tax consequences of, qualification as a REIT. It is possible that future economic, market, legal, tax or other considerations may cause our Board of Directors to determine that it is not in our best interest to qualify as a REIT and to revoke our REIT election, which it may do without stockholder approval.

If we fail to qualify as a REIT for any taxable year, we will be subject to U.S. federal income tax (including, for periods prior to 2018, any applicable alternative minimum tax) on our taxable income at regular corporate rates. In addition, we generally would be disqualified from treatment as a REIT for the four taxable years following the year in which we lost our REIT status. Losing our REIT status would reduce our net earnings available for investment or distribution because of the additional tax liability. In addition, distributions would no longer qualify for the dividends paid deduction, and we would no longer be required to make distributions. If this occurs, we might be required to borrow funds or liquidate some investments in order to pay the applicable tax.

As a result of all these factors, our failure to qualify as a REIT could impair our ability to expand our business and raise capital, and would substantially reduce our ability to make distributions to our stockholders.

To qualify as a REIT and to avoid the payment of U.S. federal income and excise taxes, we may be forced to borrow funds, use proceeds from the issuance of securities, pay taxable dividends of our stock or debt securities or sell assets to make distributions, which may result in our distributing amounts that may otherwise be used for our operations.

To obtain the favorable tax treatment accorded to REITs, we normally are required each year to distribute to our stockholders at least 90% of our REIT taxable income, determined without regard to the deduction for dividends paid and by excluding net capital gains. We will be subject to U.S. federal income tax on our undistributed taxable income and net capital gain and to a 4% nondeductible excise tax on any amount by which distributions we pay with respect to any calendar year are less than the sum of (1) 85% of our ordinary income, (2) 95% of our capital gain net income and (3) 100% of our

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undistributed income from prior years. These requirements could cause us to distribute amounts that otherwise would be spent on acquisitions of properties and it is possible that we might be required to borrow funds, use proceeds from the issuance of securities, pay taxable dividends of our stock or debt securities or sell assets in order to distribute enough of our taxable income to maintain our qualification as a REIT and to avoid the payment of U.S. federal income and excise taxes.

Future sales of properties may result in penalty taxes or may be made through TRSs, each of which would diminish the return to you.

It is possible that one or more sales of our properties may be "prohibited transactions"“prohibited transactions” under provisions of the Code. If we are deemed to have engaged in a "prohibited transaction"“prohibited transaction” (i.e., we sell a property held by us primarily for sale in the ordinary course of our trade or business), all income that we derive from such sale would be subject to a 100% tax. The

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Code sets forth a safe harbor for REITs that wish to sell property without risking the imposition of the 100% tax. A principal requirement of the safe harbor is that the REIT must hold the applicable property for not less than two years prior to its sale for the production of rental income. It is entirely possible that a future sale of one or more of our properties will not fall within the prohibited transaction safe harbor.

If we acquire a property that we anticipate will not fall within the safe harbor from the 100% penalty tax upon disposition, we may acquire such property through a TRS in order to avoid the possibility that the sale of such property will be a prohibited transaction and subject to the 100% penalty tax. If we already own such a property directly or indirectly through an entity other than a TRS, we may contribute the property to a TRS. Though a sale of such property by a TRS likely would mitigate the risk of incurring a 100% penalty tax, the TRS itself would be subject to regular corporate income tax at the U.S. federal level, and potentially at the state and local levels, on the gain recognized on the sale of the property as well as any income earned while the property is operated by the TRS. Such tax would diminish the amount of proceeds from the sale of such property ultimately distributable to our stockholders. Our ability to use TRSs in the foregoing manner is subject to limitation. Among other things, the value of our securities in TRSs may not exceed 20% of the value of our assets and dividends from our TRSs, when aggregated with all other non-real estate income with respect to any one year, generally may not exceed 25% of our gross income with respect to such year. No assurances can be provided that we would be able to successfully avoid the 100% penalty tax through the use of TRSs.

In addition, if we acquire any asset from a C corporation (i.e., a corporation generally subject to full corporate-level tax) in a merger or other transaction in which we acquire a basis in the asset determined by reference either to the C corporation'scorporation’s basis in the asset or to another asset, we will pay tax, at the highest U.S. federal corporate income tax rate, on any built-in gain recognized on a taxable disposition of the asset during the 5-year period after its acquisition. As a result of the manner in which we acquired the Hudye Farm in 2014, a subsequent taxable disposition by us of any such assets generally would be subject to the foregoing built-in gain rules.

In certain circumstances, we may be subject to U.S. federal and state income taxes as a REIT, which would reduce our cash available for distribution to our stockholders.

Even if we qualify as a REIT, we may be subject to U.S. federal income taxes or state taxes. As discussed above, net income from a "prohibited transaction"“prohibited transaction” will be subject to a 100% penalty tax and built-in gain recognized on the taxable disposition of assets acquired from C corporations in certain non-taxable transactions will be subject to tax at the highest applicable U.S. federal corporate income tax rate. To the extent we satisfy the distribution requirements applicable to REITs, but distribute less than 100% or our taxable income, we will be subject to U.S. federal income tax at regular corporate rates on our undistributed income. We may not be able to make sufficient distributions to avoid excise taxes applicable to REITs. We may also decide to retain capital gains we earn from the sale or other disposition of our properties and pay income tax directly on such income. In that event, our stockholders would be treated as if they earned that income and paid the tax on it directly. However, our stockholders that are tax-exempt, such as charities or qualified pension plans, would have no benefit from their deemed payment of such tax liability. We may also be subject to state and local taxes on our income or property, either directly or at the level of the companies through which we indirectly own our assets. Any U.S. federal or state taxes we pay will reduce our cash available for distribution to our stockholders.

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The ability of our Board of Directors to revoke or otherwise terminate our REIT qualification without stockholder approval may cause adverse consequences to our stockholders.

Our charter provides that our Board of Directors may revoke or otherwise terminate our REIT election, without the approval of our stockholders, if it determines that it is no longer in our best interest to continue to qualify as a REIT. If we cease to qualify as a REIT, we would become subject to U.S. federal income tax on our taxable income at regular corporate rates and would no longer be required to distribute most of our taxable income to our stockholders, which may have adverse consequences on our total return to our stockholders.

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If our operating partnershipOperating Partnership were classified as a "publicly“publicly traded partnership"partnership” taxable as a corporation for U.S. federal income tax purposes, we would fail to qualify as a REIT and would suffer other adverse tax consequences.

We intend for our operating partnershipOperating Partnership to be treated as a "partnership"“partnership” for U.S. federal income tax purposes. If the IRS were to successfully assert our operating partnershipOperating Partnership was “publicly traded,” our operating partnershipOperating Partnership could be taxable as a corporation if less than 90% of its gross income consisted of certain qualifying passive income. In such event, we likely would fail to qualify as a REIT for U.S. federal income tax purposes, and the resulting corporate income tax burden would reduce the amount of distributions that our operating partnershipOperating Partnership could make to us. This would substantially reduce the cash available to pay distributions to our stockholders.

Complying with the REIT requirements may cause us to forego otherwise attractive opportunities or sell properties earlier than we wish.

To maintain our qualification as a REIT for U.S. federal income tax purposes, we must continually satisfy tests concerning, among other things, the sources of our income, the nature and diversification of our assets, the amounts we distribute to our stockholders and the ownership of shares of our stock. We may be required to make distributions to our stockholders at disadvantageous times or when we do not have funds readily available for distribution, or we may be required to forego or liquidate otherwise attractive investments in order to comply with the REIT tests. Thus, compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits.

You may be restricted from acquiring or transferring certain amounts of our common stockor ourSeries B Participating Preferred Stock.

Certain provisions of the Code and the stock ownership limits in our charter may inhibit market activity in our capital stock and restrict our business combination opportunities. In order to maintain our qualification as a REIT, five or fewer individuals, as defined in the Code, may not own, beneficially or constructively, more than 50% in value of our issued and outstanding stock at any time during the last half of a taxable year. Attribution rules in the Code determine if any individual or entity beneficially or constructively owns our capital stock under this requirement. Additionally, at least 100 persons must beneficially own our capital stock during at least 335 days of a taxable year. To help insureensure that we meet these tests, our charter restricts the acquisition and ownership of shares of our stock.

Our charter, with certain exceptions, authorizes our Board of Directors to take such actions as are necessary and desirable to preserve our qualification as a REIT. Unless exempted by our Board of Directors, our charter prohibits any person from beneficially or constructively owning more than 9.8% in value or number of shares, whichever is more restrictive, of the outstanding shares of any class or series of our capital stock. Our Board of Directors may not grant an exemption from these restrictions to any proposed transferee whose ownership in excess of such ownership limit would result in our failing to qualify as a REIT.

Dividends paid by REITs generally do not qualify for the favorable tax rates available for some dividends.

The maximum U.S. federal income tax rate applicable to qualified dividend income paid to U.S. stockholders that are individuals, trusts and estates currently is 20%. Dividends paid by REITs generally are not eligible for such reduced tax rate. Instead, our ordinary dividends generally are taxed at the higher tax rates applicable to ordinary income, the current maximum rate of which is 37%. Although the favorable tax rates applicable to qualified dividend income do not adversely affect the taxation of REITs or dividends paid by REITs, such favorable tax rates could cause investors who are individuals, trusts and estates to perceive investments in REITs to be relatively less attractive than investments in the stocks of non-

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REITnon-REIT corporations that pay dividends, which could adversely affect the value of the shares of REITs, including our common stock and Series B Participating Preferred Stock.stock. However, for taxable years prior to 2026, individual stockholders are generally allowed to deduct 20% of the aggregate amount of ordinary dividends distributed by us, subject to certain limitations, which would reduce the maximum marginal effective federal income tax rate for individuals on the receipt of such ordinary dividends to 29.6%.

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Changes to the U.S. federal income tax laws, including the enactment of certain tax reform measures, could have an adverse impact on our business and financial results.

In recent years, numerous legislative, judicial and administrative changes have been made to the U.S. federal income tax laws applicable to investments in real estate and REITs, including the passage of the Tax Cuts and Jobs Act of 2017, the full impact of which may not become evident for some period of time.REITs. There can be no assurance that future changes to the U.S. federal income tax laws or regulatory changes will not be proposed or enacted that could impact our business and financial results. The REIT rules are regularly under review by persons involved in the legislative process and by the Internal Revenue Service and the U.S. Treasury Department, which may result in revisions to regulations and interpretations in addition to statutory changes. If enacted, certain of such changes could have an adverse impact on our business and financial results.

We cannot predict whether, when or to what extent any new U.S. federal tax laws, regulations, interpretations or rulings will impact the real estate investment industry or REITs. Prospective investors are urged to consult their tax advisors regarding the effect of potential future changes to the federal tax laws on an investment in our shares.

RisksPART II

Item 5

Market For Registrant’s Common Equity, Related to theStockholder Matters and Issuer Purchases of Equity Securities

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Item 6

[Reserved]

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Item 7

Management’s Discussion and Analysis of Financial Condition and Results of Operations

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Item 7A

Quantitative and Qualitative Disclosures About Market for Our Capital StockRisk

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Item 8

Financial Statements and Supplementary Data

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Item 9

Changes and Disagreements with Accountants on Accounting and Financial Disclosure

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Item 9A

Controls and Procedures

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Item 9B

Other Information

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Item 9C

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

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PART III

Item 10

Directors, Executive Officers and Corporate Governance

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Item 11

Executive Compensation

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Item 12

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

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Item 13

Certain Relationships and Related Transactions, and Director Independence

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Item 14

Principal Accountant Fees and Services

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PART IV

Item 15

Exhibits and Financial Statement Schedules

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Item 16

Form 10-K Summary

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Signatures

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SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

We make statements in this Annual Report on Form 10-K that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). These forward-looking statements include, without limitation, statements concerning pending acquisitions and dispositions, projections, predictions, expectations, estimates or forecasts as to our business, financial and operational results, future stock repurchases and other transactions affecting our capitalization, our dividend policy, future economic performance, crop yields and prices and future rental rates for our properties, ongoing litigation, as well as statements of management’s goals and objectives and other similar expressions concerning matters that are not historical facts. When we use the words “may,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” or similar expressions or their negatives, as well as statements in future tense, we intend to identify forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, beliefs and expectations, such forward-looking statements are not predictions of future events or guarantees of future performance, and our actual results could differ materially from those set forth in the forward-looking statements. Some factors that might cause such a difference include the following: the ongoing war in Ukraine and the conflict in the Middle East and their impact on our tenants’ businesses and the farm economy generally, changes in trade policies in the United States and other countries who import U.S. agricultural products, high inflation and increasing interest rates, the onset of an economic recession in the United States and other countries that impact the farm economy, extreme weather events, such as droughts, tornadoes, hurricanes or floods, the impact of future public health crises on our business and on the economy and capital markets generally, general volatility of the capital markets and the market price of our common stock, changes in our business strategy, availability, terms and deployment of capital, our ability to refinance existing indebtedness at or prior to maturity on favorable terms, or at all, availability of qualified personnel, changes in our industry or the general economy, the degree and nature of our competition, the outcomes of ongoing litigation, our ability to identify new acquisitions or dispositions and close on pending acquisitions or dispositions and the other factors described in the risk factors described in Item 1A, “Risk Factors” of this Annual Report on Form 10-K and in other documents that we file from time to time with the SEC. Given these uncertainties, undue reliance should not be placed on such statements. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking statements, except to the extent required by law.

Summary Risk Factors

Our business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial condition, results of operations, cash flows and prospects. The following is an overview of the most significant risks to which we are exposed in the normal course of our business and which are discussed more fully in “Item 1A. Risk Factors” herein. These risks include, but are not limited to, the following:

Our business is dependent in part upon the profitability of our tenants' farming operations, and a sustained downturn in the profitability of their farming operations could have a material adverse effect on the amount of rent we can collect and, consequently, our cash flow and ability to make distributions to our stockholders.

We have a substantial amount of indebtedness outstanding, which may expose us to the risk of default under our debt obligations, restrict our operations and our ability to grow our business and revenues, and restrict our ability to pay distributions to our stockholders.

Mortgage debt obligations expose us to the possibility of foreclosure, which could result in the loss of our investment in a property or group of properties subject to mortgage debt.

Increases in benchmark interest rates will increase our borrowing costs, which will negatively impact our financial condition, results of operations, growth prospects and ability to make distributions to stockholders.

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Increases in interest rates will increase our tenants’ borrowing costs and may make it more difficult for them to obtain credit.

Global economic conditions, including inflation, supply chain disruptions and trade policies affecting imports and exports, could adversely affect our and our tenants’ operations.

Approximately 70% of our portfolio is comprised of properties used to grow primary crops such as corn, soybeans, wheat, rice and cotton, which subjects us to risks associated with primary row crops.

Our farms are exposed to the possibility of extreme weather events, such as droughts, tornadoes, hurricanes and floods, which could damage the farmland and equipment, adversely affect crop yields and the ability of farmers to pay rent to us or adversely impact the financing of such properties.

Investments in farmland used for permanent/specialty crops have a different risk profile than farmland used for annual row crops.

Our failure to continue to identify and consummate suitable acquisitions would significantly impede our growth and our ability to further diversify our portfolio by geography, crop type and tenant, which could materially and adversely affect our results of operations and cash available for distribution to our stockholders.

We do not intend to continuously monitor and evaluate tenant credit quality, and our financial performance may be subject to risks associated with our tenants' financial condition and liquidity position.

Our short-term leases make us more susceptible to any decreases in prevailing market rental rates than would be the case if we entered into longer-term leases, which could have a material adverse effect on our results of operations and ability to make distributions to our stockholders.

We depend on external sources of capital that are outside of our control and may not be available to us on commercially reasonable terms or at all, which could limit our ability to, among other things, acquire additional properties, meet our capital and operating needs or make the cash distributions to our stockholders necessary to maintain our qualification as a REIT.

Laws in certain states where we own property prohibit or restrict the ownership of agricultural land by business entities, which could impede the growth of our portfolio and our ability to diversify geographically.

We may be subject to unknown or contingent liabilities related to acquired properties and properties that we may acquire in the future, which could have a material adverse effect on us.

We may be required to permit the owners of certain third-party access rights on our properties to enter and occupy parts of the properties, including owners of mineral rights and power generation and transportation infrastructure, which could materially and adversely impact the rental value of our properties.

We have previously been subject to, and may in the future be subject to, litigation or threatened litigation, which may require us to pay damages and expenses or restrict the operation of our business.

Conflicts of interest may exist or could arise in the future between the interests of our stockholders and the interests of holders of units in our Operating Partnership, which may impede business decisions that could benefit our stockholders.

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Our charter contains certain provisions restricting the ownership and transfer of our stock that may delay, defer or prevent a change of control transaction that might involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests.

We could increase the number of authorized shares of stock, classify and reclassify unissued stock and issue stock without stockholder approval, which may delay, defer or prevent a transaction that our stockholders believe to be in their best interests.

Our Board of Directors may change our strategies, policies and procedures without stockholder approval.

Our charter contains provisions that make removal of our directors difficult, which could make it difficult for our stockholders to effect changes to our management.

Failure to maintain qualification as a REIT for U.S. federal income tax purposes would subject us to U.S. federal income tax on our taxable income at regular corporate rates, which would substantially reduce our ability to make distributions to our stockholders.

Complying with the REIT requirements may cause us to forego otherwise attractive opportunities or sell properties earlier than we wish.

We may be unable to make distributions at expected levels, which could result in a decrease in the market price of our common stock.

We intendare subject to continue to pay regular quarterly distributions to our stockholders. However, we significantly reduced the amount of distributionsrisks associated with public health crises, such as pandemics and epidemics, which may have a material adverse effect on our common stock beginningbusiness. The nature and extent of future impacts are highly uncertain and unpredictable.

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PART I

Item 1. Business

Our Company

Farmland Partners Inc. (“FPI”), collectively with its subsidiaries, is an internally managed real estate company that owns and seeks to acquire high-quality farmland located in agricultural markets throughout North America. FPI was incorporated in Maryland on September 27, 2013. FPI elected to be taxed as a real estate investment trust (“REIT”) under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with its short taxable year ended December 31, 2014.

FPI is the sole member of the sole general partner of Farmland Partners Operating Partnership, LP (the “Operating Partnership”), which was formed in Delaware on September 27, 2013. All of FPI’s assets are held by, and its operations are primarily conducted through, the Operating Partnership and the wholly owned subsidiaries of the Operating Partnership. As of December 31, 2023, FPI owned a 97.6% interest in the Operating Partnership. See “Note 9—Stockholders’ Equity and Non-controlling Interests” for additional discussion regarding Class A Common units of limited partnership interest in the Operating Partnership (“Common units”), Series A preferred units of limited partnership interest in the Operating Partnership (“Series A preferred units”) and Series B participating preferred units of limited partnership interest in the Operating Partnership (“Series B participating preferred units”). Unlike holders of FPI’s common stock, par value $0.01 per share (“common stock”), holders of the Operating Partnership’s Common units and Series A preferred units generally do not have voting rights or the power to direct the affairs of FPI.

References to the “Company,” “we,” “us,” or “our” mean collectively FPI and its consolidated subsidiaries, including the Operating Partnership.

Our primary strategic objective is to utilize our position as a leading institutional acquirer, owner and manager of high-quality farmland located in agricultural markets throughout North America to deliver strong risk adjusted returns to investors through a combination of cash dividends and asset appreciation. As of December 31, 2023, we owned farms with an aggregate of approximately 132,800 acres in Arkansas, California, Colorado, Florida, Illinois, Indiana, Kansas, Louisiana, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, South Carolina and Texas. In addition, as of December 31, 2023, we owned land and buildings for four agriculture equipment dealerships in Ohio leased to Ag-Pro Ohio, LLC (“Ag Pro”) under the John Deere brand and served as property manager for approximately 38,300 acres, including farms in Iowa (see “Note 4—Related Party Transactions”). As of December 31, 2023, the Operating Partnership owned a 9.97% equity interest in Promised Land Opportunity Zone Farms I, LLC (the “OZ Fund”), an unconsolidated equity method investment, that holds 12 properties (see “Note 1, Convertible Notes Receivable”). As of December 31, 2023, approximately 70% of our owned portfolio (by value) was used to grow primary crops, such as corn, soybeans, wheat, rice and cotton, and approximately 30% was used to produce specialty crops, such as almonds, citrus, blueberries, and vegetables. We believe our portfolio gives investors the economic benefit of increasing global food demand in the face of growing scarcity of high-quality farmland and will continue to reflect the approximate allocation of U.S. agricultural output between primary crops and animal protein (whose production relies principally on primary crops as feed), on one hand, and specialty crops, on the other. 

In addition, we offer a loan program (the “FPI Loan Program”) pursuant to which we make loans to third-party farmers (both tenant and non-tenant) to provide financing for property acquisitions, working capital requirements, operational farming activities, farming infrastructure projects and for other farming and agricultural real estate related projects.

FPI Agribusiness Inc., a wholly owned subsidiary (the “TRS” or “FPI Agribusiness”), is a taxable REIT subsidiary that was formed to provide volume purchasing servicesto the Company’s tenants and to directly operate farms under certain circumstances. As of December 31, 2023, the TRS performed direct farming operations on 2,103 acres of permanent crop farmland owned by the Company located in California.

FPI strategically seeks opportunities to promote environmentally friendly usage of our farmland. We have long-term lease arrangements on certain farm properties pursuant to which operators engage in solar and wind energy production.

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As of December 31, 2023, 15 of our farms, which collectively comprised approximately 10,150 acres, had leases for operational or under-construction renewable energy production, and 16 of our farms, which collectively comprise approximately 12,875 acres, had options for potential future solar or wind development and operating lease. Refer to “–Sustainability” for more information.

Our principal source of revenue is rent from tenants that conduct farming operations on our farmland pursuant to leases with terms ranging primarily from one to three years. The majority of the leases that are in place as of the date of this Annual Report on Form 10-K have fixed rent payments. Some of our leases have variable rents based on the revenue generated by our farm-operator tenants. We believe that a mix of fixed and variable rents will help insulate us from the variability of farming operations and reduce our credit-risk exposure to farm-operator tenants while making us an attractive landlord in certain regions where variable leases are customary. However, we may be exposed to tenant credit risk and farming operation risks, particularly with respect to leases that do not require advance payment of 100% of the fixed rent, variable rent arrangements and leases with terms greater than one year.

Full Year 2023 Highlights

During 2023:

Net income increased 164.9% from $12.0 million for the year ended December 31, 2022 to $31.7 million for the year ended December 31, 2023;
Adjusted Funds from Operation ("AFFO") decreased 48.4% from $15.8 million for the year ended December 31, 2022 to $8.1 million for the year ended December 31, 2023;
We completed dispositions consisting of 74 properties in the third quarterCorn Belt, Delta and South, High Plains, Southeast and West Coast regions. We received $195.5 million in aggregate consideration, including $11.8 million in seller financing, and recognized an aggregate gain on sale of 2018, and we may be required to reduce our distributions further$36.1 million;
We completed acquisitions consisting of four properties in the future. All distributions will be made at the discretion of our Board of DirectorsCorn Belt and will be based upon, among other factors, our historicalDelta and projected results of operations, financial condition,South regions. Aggregate cash flows and liquidity, maintenance of our REIT qualification and other tax considerations, capital expenditure and other expense obligations, debt covenants, contractual prohibitions or other limitations and applicable law and such other matters as our Board of Directors may deem relevant from time to time. If sufficient cash is not availableconsideration for distribution from our operations, we may have to fund distributions from working capital, borrow to provide funds for such distributions, or reduce the amount of such distributions. To the extent we borrow to fund distributions, our future interest costs would increase, thereby reducing our earnings and cash available for distribution from what they otherwise would have been. If cash available for distribution generated by our assets is less than our current estimate, or if such cash available for distribution decreases in future periods from expected levels, our inability to make the expected distributions could result in a decrease in the market pricethese acquisitions totaled $22.2 million;
We repurchased 6,551,087 shares of our common stock or Series B Participating Preferred Stock.at a weighted average price of $11.00 per share;
Total indebtedness decreased $76.4 million from $439.5 million at December 31, 2022 to $363.1 million at December 31, 2023;
We increased liquidity to $206.6 million as of December 31, 2023, compared to $176.7 million as of December 31, 2022; and
We renewed fixed cash farm leases expiring in 2023 at average rent increases of approximately 20%.

For a definition of AFFO and a reconciliation of net income to AFFO, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Non-GAAP Financial Measures.”

Investment Focus

We seek to invest in farmland that will give our stockholders exposure to a well-diversified portfolio of high-quality U.S. farmland, while offering an attractive risk-adjusted combination of stable rental income generation and value appreciation. Our principal investment focus is on farmland located in agricultural markets throughout North America; however, we may seek to acquire farmland outside of North America in the future. We also may acquire real estate assets related to farming, such as grain storage facilities, grain elevators, feedlots, cold storage facilities, controlled environment agriculture facilities, land and facilities leased to agriculture equipment dealerships, processing plants and distribution centers, as well as livestock farms or ranches. In addition, under the FPI Loan Program, we may provide loans to farm operators secured by farmland, properties related to farming, crops (growing or stored), and/or agricultural equipment. We may also invest in other agriculture-related business, typically through our TRS.

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Crop Categories

Primary vs Specialty Crops

Farm crops generally can be divided into two principal categories: primary crops and specialty crops. Primary crops include, among others, corn, soybeans, wheat, rice and cotton. Primary crops are generally grown in rows and are often referred to as row crops. Specialty crops can be divided into two categories: annual specialty crops (generally vegetables) and permanent specialty crops (fruits and nuts grown on trees, bushes or vines). Over the long term, we expect that our farmland portfolio will continue to be comprised of approximately 70% primary crop farmland and 30% specialty crop farmland by value, which we believe will give investors the economic benefit from increasing global food demand in the face of growing scarcity of high quality farmland and will reflect the approximate allocation of U.S. agricultural output between primary crops and animal protein (whose production relies principally on primary crops as feed), on one hand, and specialty crops, on the other.

Primary Crops

The most widely grown crop in the United States is corn, at approximately 93 million acres. The uses of corn projected for the 2023/2024 marketing year (September 2023 to August 2024) are as follows: animal feed and residual products (34%); ethanol and its animal feed byproducts known as distillers’ dried grains with solubles or DDGS (32%); exports (13%); other sugars, starches, cereals, seeds (8%); and ending stocks or inventory (13%).

The second most widely grown crop in the United States is soybeans, at approximately 83 million acres. The uses of soybeans projected for the 2023/2024 marketing year (September 2023 to August 2024) are as follows: crushings (52%); exports (39%); seed and residual (3%); and ending stocks or inventory (6%). The process of crushing soybean produces soybean oil, soybean meal, hulls and waste. Soybean meal is used as animal feed both domestically and in the export market. Soybean oil is used for food, biofuel, and is exported.

The third most widely grown crop in the United States is wheat, at approximately 51 million acres. The uses of wheat projected for the 2023/2024 marketing year (June 2023 to May 2024) are as follows: food (38%); exports (29%); seed, feed and residual (7%); and ending stocks or inventory (26%).

Annual vs. Permanent Crops

Our portfolio includes farms that produce both annual and permanent crops. Annual crops, such as wheat, corn and soybeans, are planted every year whereas permanent crops, such as trees, bushes and vines, are planted and bear crops over multiple years without replanting. We believe exposure to both annual and permanent crops is an attractive strategy and offers diversification benefits to our portfolio. Annual and permanent crops typically serve different end-markets and generally have uncorrelated pricing.

U.S. Farmland Property

We believe that the United States offers farmland investors exposure to financial benefits driven by the fundamentals of agricultural production and farmland appreciation without many of the risks that come with farmland investments in many other countries. In the United States, the farmland market is relatively liquid and there is virtually no land title risk. As an asset class, United States farmland has lower leverage compared to other real estate sectors. According to the United States Department of Agriculture (“USDA”) forecast data from February 2024, real estate debt on farms is $377 billion, compared to a real estate value of $3.6 trillion, representing a 10% debt-to-equity ratio. The United States has the largest, lowest-cost grain transportation infrastructure in the world, leaving more margin to the grain producer and landowner. Moreover, the United States is one of the largest domestic markets for primary crops, which are typically priced in U.S. dollars. Lastly, we believe that in most major U.S. agricultural markets, multiple quality farm-operator tenants compete for farmland lease opportunities.

We may consider investing in farmland in other countries, such as Canada, Australia or New Zealand, that, like the United States, offer virtually no land title risk, a sophisticated farm-operator tenant environment and attractive rental rates.

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Leased Properties

The business of farming carries materially more operating risk than owning and leasing farmland to farm operators, although such risk can be mitigated through crop insurance and other risk management tools. We expect to continue to lease a majority of our properties on a fixed-rent basis that does not depend on the success of the tenant's farming operations. Moreover, a majority of the leases in our portfolio provide that at least 50% (and sometimes 100%) of the annual fixed rent is due and payable in advance of each spring planting season, and we expect that a majority of the fixed-rent leases we enter into in the future will have a similar requirement, which reduces our credit-risk exposure in the event of operational issues with the farm-operator tenant. However, to the extent we enter into leases that do not require advance payment of 100% of the annual rent or have terms greater than one year, we may be subject to tenant credit risk and more susceptible to the risks associated with declines in the profitability of tenants’ farming operations, and we take such risk into consideration when evaluating the potential return on a farm. We may use variable-rent leases, which depend in part on crop yields and prices, in regions where such arrangements are prevalent or when we expect that such arrangements will be more profitable to us on a risk-adjusted basis. We also may utilize hybrid lease arrangements that provide for a combination of fixed rent and variable rent.

We expect to continue to lease the majority of our primary crop farmland under leases that require the tenant to either pay or reimburse us for substantially all of the property’s operating expenses, including maintenance, water usage and insurance. Consistent with industry practices, we expect that we will generally be responsible for plantings and associated improvements on our permanent crop farmland while our tenants will be responsible for all operating costs. Many of our leases provide for the reimbursement by the tenant of the property’s real estate taxes that we pay in connection with the farms they rent from us. The rental payments we receive from the farm operators are the primary source of any distributions that we make to our stockholders.

We expect that over time rental income will increase. Most farmland in the areas where we own or intend to acquire land is leased under short-term leases (typically five years or less), and we plan to lease our primary crop properties under short-term leases when possible. By entering into short-term leases, we believe we will be in a position to increase our rental rates when the leases expire. However, we can provide no assurances that we will be able to increase our rental rates, or even maintain them at the same level, when the leases are renewed or the land is re-leased.

We believe quality farmland has a near-zero vacancy rate, and we believe that all high-quality farmland in an area with a competitive tenant environment is generally leased and farmed each year. In the event of a tenant's failure to pay rent due in advance of the spring planting season, we will seek to terminate the lease and rent the property to another tenant that could then plant and harvest a crop that year. As a result, we believe there is a reduced risk of vacancy on our properties when compared to most other types of commercial properties, such as office buildings or retail properties.

Tenants

We believe the areas where we own and intend to acquire farmland are characterized by a competitive farm-operator tenant environment, with multiple experienced farm operators seeking to expand their operations by leasing additional farmland. Farmers have long rented land to increase operations without having to invest the capital required to own the land. USDA data shows that rented land as a percentage of total farmland acres has been in the 35% to 45% range since the 1920s.

Non-Farming Leases

In addition to leases entered into in connection with farming operations, we seek additional sources of income from our properties that are either incremental, such as wind easements and recreational leases, or are higher than farming rents, such as leases for solar power installations. While we do not believe that such non-farming lease income will constitute a significant percentage of our total revenues, they offer opportunities to enhance returns to stockholders at little or no cost to us.

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Family-Owned Properties

According to America’s Farms and Ranches at a Glance 2023 Edition, a USDA report, family farms accounted for approximately 97% of the total farms in the United States. As shown below, small family farms represent the greatest number of farms and amount of land, while large-scale family farms represent the greatest value of production.

Farm Category

    

Annual Gross Farm Cash Income

    

Number of Farms

    

Percent of Farms

    

Percent of Land Area

    

Value of Production

Small Family Farms

Less than $350,000

1,756,441

88.1

%

46.5

%

18.7

%

Midsize Family Farms

Less than $1,000,000

115,595

5.8

%

21.4

%

19.1

%

Large-Scale Family Farms

Greater than $1,000,000

67,936

3.4

%

24.8

%

51.8

%

Nonfamily Farms

54,450

2.7

%

7.3

%

10.4

%

Total

1,994,422

100.0

%

100.0

%

100.0

%

Farmland leases allow farm operators to unlock personal or family capital/net worth that would otherwise be tied up in land ownership while retaining the ability to conduct their livelihoods on land that is familiar to them. We believe that many farm families and individuals may wish to engage in sale-leaseback transactions to grow their farming operations or in other business endeavors, or for estate planning reasons, providing a continuous pipeline of prospective acquisitions.

As an alternative to selling their farmland to us in an all-cash transaction, we believe that some farm owners may be interested in selling their farmland to us in exchange for Operating Partnership units in order to own a diversified portfolio of agricultural real estate in transactions that may qualify as tax-deferred contributions to a partnership under U.S. federal income tax laws. In addition, because we intend to make cash distributions quarterly or annually, Partnership unit holders would receive regular cash distributions, and their investment would be diversified across a much larger number of properties than the single property in which they were invested before such contribution. Finally, Partnership unit holders would have the flexibility to tender their Partnership units in the future for redemption by us for cash, or, at our election, shares of our common stock that they could then sell in the public market, thereby allowing these sellers to determine the timing of recognizing taxable gain. Because we expect the issuance of Partnership units in exchange for farmland generally will be driven by the desires of prospective sellers, we do not know how frequently we will issue Partnership units in exchange for farmland properties. However, we believe that using Partnership units as acquisition consideration can be a significant part of our property acquisition strategy.

Other Investments

In addition to farmland, we also may acquire real estate assets related to farming, such as grain storage facilities, grain elevators, feedlots, cold storage facilities, controlled environment agriculture facilities, land and facilities leased to agriculture equipment dealerships, processing plants and distribution centers, as well as livestock farms or ranches.

Underwriting Criteria and Due Diligence Process

Identifying and Selecting Attractive Properties

We seek to acquire high-quality farmland that offers an attractive risk-adjusted balance of current income and value appreciation potential. We believe our management team’s deep understanding of agribusiness fundamentals and insight into factors affecting the value of farmland allow us to identify properties consistent with our investment criteria. We believe the following factors are important in the selection of farmland:

Soil Quality—Soil quality is a fundamental determinant of farmland productivity and therefore of its value. In general, we focus on farmland with average or better-than-average soil. 

Water Availability—Appropriate water availability is an essential input to farming and a key consideration in determining the productivity and value of farmland. We seek to acquire farmland where water availability through precipitation and irrigation meets the agronomic needs of the crops expected to be grown. As part of our acquisition due diligence process, we evaluate properties for water availability and any associated ground or surface water rights. Where appropriate, we may also invest in irrigation infrastructure to improve the productivity

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of properties we own. Occasionally we may acquire farmland at prices that more than compensate us for any potential reduction in water availability, which, in the future, may result in a shift to different crops or production systems.

Robust and Competitive Tenant Environment—We focus primarily on farmland located in areas characterized by a robust and competitive tenant environment, with a relatively large population of experienced farm operators as potential tenants. 

Market Access—Due to the higher costs of road transportation, the location of primary crop farmland relative to points of demand (e.g., grain elevators, feedlots and ethanol plants) or access to low-cost transportation (e.g., river ports and rail loading facilities) determines the premium or discount in farm-gate commodity prices compared to the general market prices (also known as “basis”), and therefore is one of the factors that impacts its value. We focus on acquiring primary crop farmland in areas with substantial farming infrastructure and low transportation costs, including markets with access to river and rail transportation.

Climate—Crops have particular climatic growing requirements. Accordingly, we seek to acquire properties in regions with climates conducive to the expected crops. We believe that diversification within and across core farming regions and crop types provides significant annual and long-term risk mitigation to our investors.  Nevertheless, our farmland may experience periodic droughts and other significant weather events, such as tornadoes, hurricanes and floods.

We perform a due diligence review with respect to each potential property acquisition. The due diligence investigation includes both property-specific factors (e.g., soil types and fertility, water availability and rights, topographical characteristics and property taxes) and location-specific factors (e.g., climate, tenant availability and quality, and market access). As part of our due diligence process, we also perform a valuation of each target property and estimate expected lease rates.

Identifying and Selecting Tenants

We intend to continue to focus primarily on farm properties located in areas with a robust and competitive environment of experienced tenants. In general, the tenant selection process focuses primarily on candidates' experience and reputation based upon background and reference checks, as well as their willingness and ability to pay competitive rental rates. In geographic areas where we already own one or more properties, we may give our existing local tenants priority consideration, especially when a tenant sources the property acquisition opportunity. We believe our use of leases pursuant to which at least 50% of the annual rent is typically payable in advance of each spring planting season mitigates the tenant credit risk associated with the variability of farming operations that could be adversely impacted by poor crop yields, weather conditions, mismanagement, undercapitalization or other factors affecting our tenants. Tenant credit risk is further mitigated by the farming industry practice of purchasing crop insurance in almost every circumstance because it is required by lenders who provide working capital financing to our tenants and due to requirements in our leases. In certain cases, the Company perfects its security interest in the crop insurance proceeds and the underlying growing crops using practices applicable in the state where the farm is located. In addition, we monitor our existing tenants by periodically conducting site visits of the farms and meeting with the tenants to discuss their farming operations and the condition of the farms. However, in some circumstances, we may be exposed to tenant credit risk and may be subject to farming operation risks, such as adverse weather conditions and declines in commodity prices, particularly with respect to leases that do not require advance payment of 100% of the annual rent, variable-rent leases for which the rent is based on a percentage of a tenant's farming revenues and leases with terms greater than one year. See “Risk Factors—Risks Related to Our Business and Properties.” We do not intend to continuously monitor and evaluate tenant credit quality and may be subject to risks associated with our tenants' financial condition and liquidity position.

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Complementary Businesses

FPI Loan Program

We believe that our existing systems and personnel are well suited to source, conduct due diligence evaluations with respect to, close and service loans under the FPI Loan Program at little or no additional operating cost to us. We believe that the business of making loans to farm operators secured by farmland, properties related to farmland, crops (growing or stored), and/or agricultural equipment leverages the substantial expertise in agribusiness possessed by the FPI team and is highly complementary to our core business of investing in farmland. We generally find potential borrowers during the process of sourcing farm acquisitions. We conduct due diligence on loan collateral largely the same way we conduct due diligence on potential farm acquisitions, and we screen potential borrowers using criteria similar to those used to screen potential tenants. The FPI Loan Program offering gives us an increased visibility in the marketplace, thereby benefiting our core farmland investing business.

Asset Management for Third Parties

We believe that our existing systems and personnel are well suited to source, conduct due diligence evaluations with respect to, close and manage farmland on behalf of third parties at little or no additional cost to us, generating fee income without capital investment. As of December 31, 2023, we managed approximately 38,300 acres on behalf of third parties.

Brokerage and Auction Services

The acquisition of Murray Wise Associates, LLC (“MWA”) in November 2021 also added brokerage and auction business activities for clients seeking to sell farmland. This increases our breadth of activities in the farmland sector, while adding additional sources of revenue and market insight.

Seasonality

We recognize rental revenue from fixed-rate leases on a pro rata basis over the non-cancellable term of the lease in accordance with accounting principles generally accepted in the United States (“GAAP”). Notwithstanding GAAP accounting requirements to spread rental revenue over the lease term, a significant portion of fixed rent is received in a lump sum before planting season, generally in the first quarter, and after harvest, in the fourth quarter or in the following year. We receive a significant portion of our variable rental payments following harvest in the fourth quarter of each year, with only a portion of such payments being recognized ratably through the year in accordance with GAAP, in relation to crop insurance contracts entered into by our tenants. The highly seasonal nature of the agriculture industry causes seasonality in our business to some extent, with revenue in the first and fourth quarter tending to be meaningfully higher than revenue in the second and third quarters. Our financial performance should be evaluated on an annual basis, which eliminates impacts of seasonality and other similar factors that may cause our quarterly results to vary during the course of the year.

Our Properties

As of December 31, 2023, we owned farms with an aggregate of approximately 132,800 acres in Arkansas, California, Colorado, Florida, Illinois, Indiana, Kansas, Louisiana, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, South Carolina and Texas. In addition, as of December 31, 2023, we owned land and buildings for four agriculture equipment dealerships in Ohio leased to Ag Pro under the John Deere brand and served as property manager for approximately 38,300 acres, including farms in Iowa (see “Note 4—Related Party Transactions”). During the year ended December 31, 2023, the Company completed dispositions, consisting of 74 properties, in the Corn Belt, Delta and South, High Plains, Southeast and West Coast regions. We received $195.5 million in aggregate consideration, including $11.8 million in seller financing, and recognized an aggregate gain on sale of $36.1 million. Also, during the year ended December 31, 2023, the Company completed acquisitions consisting of four properties in the Corn Belt and Delta and South regions. Aggregate cash consideration for these acquisitions totaled $22.2 million. See “Management’s Discussion and Analysis of Financial

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Condition and Results of Operations” for more information about our portfolio. The distribution of farms owned by regions is as follows:

Region (1)

    

Owned Acres

    

Managed Acres

    

Total Acres

Corn Belt (2)

44,527

22,027

66,554

Delta and South

26,427

8,763

35,190

High Plains

21,831

1,380

23,211

Southeast

28,825

6,107

34,932

West Coast

11,189

11,189

132,799

38,277

171,076

(1)Corn Belt includes farms located in Illinois, Indiana, Iowa, Missouri and eastern Nebraska. Delta and South includes farms located in Arkansas, Louisiana, Mississippi and Oklahoma. High Plains includes farms located in Colorado, Kansas and Texas. Southeast includes farms located in Florida, North Carolina and South Carolina. West Coast includes farms located in California.
(2)In addition, we own land and buildings for four agriculture equipment dealerships in Ohio leased to Ag Pro under the John Deere brand.

Tax Status

We elected and qualified to be taxed as a REIT for U.S. federal income tax purposes commencing with our short taxable year ended December 31, 2014. Our qualification as a REIT will depend upon our ability to meet, on a continuing basis, through actual investment and operating results, various complex requirements under the Code, relating to, among other things, the sources of our gross income, the composition and values of our assets, our distribution levels and the diversity of ownership of our capital stock. We believe that we are organized in conformity with the requirements for qualification as a REIT under the Code and that our intended manner of operation will enable us to meet the requirements for qualification and taxation as a REIT for U.S. federal income tax purposes.

As a REIT, we generally are not subject to U.S. federal income tax on our taxable income that we distribute to our stockholders. Under the Code, REITs are subject to numerous organizational and operational requirements, including a requirement that they distribute on an annual basis at least 90% of their REIT taxable income, determined without regard to the deduction for dividends paid and excluding any net capital gains. If we fail to qualify for taxation as a REIT in any taxable year and do not qualify for certain statutory relief provisions, our income for that year will be subject to tax at regular corporate rates, and we would be disqualified from taxation as a REIT for the four taxable years following the year during which we ceased to qualify as a REIT. Even if we qualify as a REIT for U.S. federal income tax purposes, we may still be subject to state and local taxes on our income and assets and to U.S. federal income and excise taxes on our undistributed income. Additionally, any income earned by FPI Agribusiness Inc., our taxable REIT subsidiary, and any other taxable REIT subsidiaries that we form or acquire in the future will be fully subject to U.S. federal, state and local corporate income tax.

Insurance

The Company maintains comprehensive property and casualty and general liability insurance through its relationship with a national insurance brokerage firm with extensive agricultural experience. The Company’s workers’ compensation is provided through a professional employee organization, and the Company maintains liability insurance covering its directors and officers. Certain other insurance programs are maintained as required by contract or deemed necessary by our management team, including crop insurance for farms operated by the Company. Under the terms and conditions of the leases on our current properties, tenants are generally required, at their expense, to obtain and keep in full force during the term of the lease liability insurance and to name us an additional insured party. To the extent required, tenants also maintain workers’ compensation policies for their businesses. These policies include liability coverage for bodily injury and property damage arising out of the ownership, use, occupancy or maintenance of the properties and all of their appurtenant areas. The terms of leases that include variable rent payments generally require the tenant to carry crop insurance protecting against crop failures and/or crop price declines.

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Regulation

Farming Regulations

The farmland that we own and intend to acquire in the future is typically used for growing crops and is subject to the laws, ordinances and regulations of state, local and federal governments, including laws, ordinances and regulations involving land use and usage, water rights, treatment methods, disturbance, the environment and eminent domain.

Farmland is principally subject to environmental and agricultural laws, ordinances and regulations. Each governmental jurisdiction has its own distinct laws, ordinances and regulations governing the use of farmland. Many such laws, ordinances and regulations seek to regulate water usage and water runoff because water can be in limited supply, as is the case where certain of the properties in our portfolio are located.

All of the farms in our portfolio have sources of water, including expected precipitation, existing and planned wells and/or surface water, that currently provide sufficient amounts of water necessary for the current farming operations at each location. However, should the need arise for additional water from wells and/or surface water sources, such permits and approvals may be difficult to obtain in areas with limited supply of available water. We believe that as of the date of this Annual Report on Form 10-K our farms are in compliance with applicable state, county and federal environmental and agricultural regulations.

In addition to the regulation of water usage and water runoff, state, local and federal governments also seek to regulate the type, quantity and method of use of chemicals and materials for growing crops, including fertilizers, pesticides and nutrient rich materials. Such regulations could include restricting or preventing the use of such chemicals and materials near residential housing or near water sources. Further, some regulations have strictly forbidden or significantly limited the use of certain chemicals and materials.

As an owner of farmland, we may be liable or responsible for the actions or inactions of our tenants with respect to these laws, regulations and ordinances.

Real Estate Industry Regulation

Generally, the ownership and operation of real properties is subject to various laws, ordinances and regulations, including regulations relating to zoning, land use, water rights, wastewater, storm water runoff and lien sale rights and procedures. These laws, ordinances or regulations, such as the Comprehensive Environmental Response and Compensation Liability Act (“CERCLA”) and its state analogs, or any changes to any such laws, ordinances or regulations, could result in or increase the potential liability for environmental conditions or circumstances existing, or created by tenants or others, on our properties. Laws related to upkeep, safety and taxation requirements may result in significant unanticipated expenditures, loss of our properties or other impairments to operations, any of which would adversely affect our cash flows from operating activities.

Environmental Matters

As an owner of real estate, we will be subject to various federal, state and local environmental laws, regulations and ordinances and also could be liable to third parties resulting from environmental contamination or noncompliance at our properties. Environmental laws often impose liability without regard to whether the owner or operator knew of or was responsible for the presence of the contaminants. The costs of any required investigation or cleanup of these substances could be substantial. The liability is generally not limited under such laws and could exceed the property’s value and the aggregate assets of the liable party. The presence of contamination or the failure to remediate contamination at our properties also may expose us to third-party liability for personal injury or property damage or adversely affect our ability to lease the real property or to borrow using the real estate as collateral. These and other risks related to environmental matters are described in more detail in “Item 1A. Risk Factors.”

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Sustainability

We believe a strong commitment to multi-faceted sustainability supports our business model and promotes environmental stewardship. Our sustainability policy is founded on the principle of helping feed the world, especially people in poverty, with the least negative environmental impact possible. Sustainability is considered a high priority topic at all levels of our organization, with a commitment formulated by the Board of Directors and senior management team.

Social Impact, Human Rights, and Company Culture

Utilizing land for farming creates a more sustainable future for all by affordably feeding the world’s growing population and supplying food products that support better nutrition. Moreover, we act as a channel to bring capital, and therefore economic activity, to rural communities throughout the United States, supporting farming as a livelihood as it has been for thousands of years. We support the United Nations’ Universal Declaration of Human Rights and are committed to ensuring that human rights are respected throughout our extended community of employees, tenants and suppliers. We require our tenants to comply with all applicable labor and environmental regulations. We foster a company culture based on open communication and professional growth, and support employees engaged with non-profit organizations.

Environmental Sustainability

Farmland is more environmentally friendly than most types of commercial real estate, as agriculture naturally uses solar energy to capture carbon dioxide from the atmosphere and convert it into food, feed, fuel, and fiber. Principles of environmental sustainability are deeply interwoven into modern agricultural practices and are embedded into our farmland acquisition criteria and management practices. We foster long-term relationships with our tenants, who are incentivized to provide good stewardship for the land they rent from us. The use of farmland as a carbon sink to generate carbon credits is a double-impact (environmental and financial) opportunity that we believe will continue to increase in significance in coming years.

Renewable energy generation (wind and solar) is a component of our business model of growing importance. As of December 31, 2023, we leased acres to support 3 solar energy operational projects across 11 farms and 2 wind energy projects across 4 farms, which have the capacity to generate approximately 214 and 30 megawatts of renewable energy, respectively. We own 16 additional farms which have options for future solar projects. We expect to continue to take advantage of opportunities to place solar panels and windmills on farmland owned by FPI.

We place significant emphasis on the support of biodiversity and wildlife. Our portfolio supports biodiversity through the enrollment of acres, in partnership with our tenants, in the U.S. Department of Agriculture’s Conservation Reserve Program (CRP). In exchange for a yearly rental payment, CRP participants agree to remove less-productive land from agricultural production and re-establish native vegetation to improve water quality, prevent erosion, and protect wildlife habitat. We also agreed in 2021 to sell Ducks Unlimited (“DU”) approximately 1,268 acres of farmland in a three-part conservation transaction to support habitat restoration and protection in Virginia. The multi-year, staged sale concluded in November 2023 and was designed to provide DU maximum flexibility to secure capital for the project. Many more of our farms provide habitat for waterfowl and other wildlife.

Competition

Competition to acquire farmland can come from many different sources. Individual farmers are the most active buyers of farmland. Institutional investors, investment funds, other farmland REITs, individual investors and others also compete for farmland acreage. Investment firms that we might compete directly against for investment capital to be deployed in farmland could include agricultural investment firms such as Westchester Agriculture Asset Management (a TIAA company), Manulife Investment Management, International Farming Corporation, Ceres Partners, Gladstone Land Corporation, UBS Agrivest, AgIS Capital, Homestead Capital, and Goldcrest Farm Trust Advisors. These firms engage in the acquisition, asset management, valuation and disposition of farmland properties.

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Human Capital Resources

Our employees are vital to our success. Our goal is to ensure that we have the right talent, in the right place, at the right time. We do that through our commitment to attracting, developing and retaining our employees.

We have designed a compensation structure, including an array of benefit and long-term incentive plans, that we believe is attractive to our current and prospective employees. We also offer employees the opportunity to participate in conferences and continuing education.

We seek to retain our employees by using their feedback to create and continually enhance programs that support their needs. We have a formal performance review process for our employees. We have a values-based culture, an important factor in retaining our employees. We are committed to having a diverse workforce, and an inclusive work environment is a natural extension of our culture.

At December 31, 2023, we had 26 employees, 25 of which are full time. None of our employees are a member of a labor union.

Corporate Information

Our executive offices are located at 4600 South Syracuse Street, Suite 1450, Denver, Colorado 80237. Our telephone number at our executive offices is (720) 452-3100 and our corporate website is www.farmlandpartners.com. The information on, or accessible through, our website is not incorporated into and does not constitute a part of this Annual Report on Form 10-K or any other report or document we file with or furnish to the SEC.

Available Information

We file our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to those reports with the SEC. You may obtain copies of these documents by accessing the SEC’s website at www.sec.gov. In addition, as soon as reasonably practicable after such materials are furnished to the SEC, we make copies of these documents available to the public free of charge through our website or by contacting our Secretary at the address set forth above under “—Corporate Information.”

Our Corporate Governance Guidelines, Code of Business Conduct and Ethics, and the charters of our audit committee, compensation committee, and nominating and corporate governance committee are all available in the Governance Documents section of the Corporate Information section of our website. The information accessible on our website is not incorporated in, nor should be considered a part of, this Annual Report on Form 10-K.

Financial Information

For required financial information related to our operations, please refer to our consolidated financial statements, including the notes thereto, included within this Annual Report on Form 10-K.

Item 1A. Risk Factors

Set forth below are the risks that we believe are material to our stockholders. You should carefully consider the following risks in evaluating our Company and our business. The occurrence of any of the following factors, events or circumstances described below could materially adversely impact our financial condition, results of operations, cash flow, the market price of shares of our common stock and preferred stock and our ability to, among other things, satisfy our debt service obligations and to make distributions to our stockholders, which in turn could cause our stockholders to lose all or a part of their investment. Some statements in this report including statements in the following risk factors constitute forward-looking statements. Please refer to the section entitled “Special Note Regarding Forward-Looking Statements” at the beginning of this Annual Report on Form 10-K.

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Risks Related to Our Business and Properties

Our business is dependent in part upon the profitability of our tenants' farming operations, and a sustained downturn in the profitability of their farming operations could have a material adverse effect on the amount of rent we can collect and, consequently, our cash flow and ability to make distributions to our stockholders.

We depend on our tenants to operate the farms we own in a manner that generates revenues sufficient to allow them to meet their obligations to us, including their obligations to pay rent and real estate taxes, maintain certain insurance coverage and maintain the properties generally. The ability of our tenants to fulfill their obligations under our leases depends, in part, upon the overall profitability of their farming operations, which could be adversely impacted by, among other things, adverse weather conditions, crop prices, crop disease, pests, and unfavorable or uncertain political, economic, business, trade or regulatory conditions. We are susceptible to any decline in the profitability of our tenants' farming operations, to the extent that it would impact their ability to pay rents. In addition, many farms are dependent on a limited number of key individuals whose injury or death may affect the successful operation of the farm. We can provide no assurances that, if a tenant defaults on its obligations to us under a lease, we will be able to lease or re-lease that farm on economically favorable terms in a timely manner, or at all. In addition, we may experience delays in enforcing our rights as landlord and may incur substantial costs in protecting our investment.

As a result, any downturn in the profitability of the farming operations of our tenants or a downturn in the farming industry as a whole could have a material adverse effect on our financial condition, results of operations, cash flow and ability to make distributions to our stockholders.

We have a substantial amount of indebtedness outstanding, which may expose us to the risk of default under our debt obligations, restrict our operations and our ability to grow our business and revenues and restrict our ability to pay distributions to our stockholders.

As of December 31, 2023, we had approximately $363.1 million of outstanding indebtedness excluding debt issuance costs, most of which is secured by mortgages on our farms. We intend to incur additional debt in connection with refinancing of existing indebtedness, future acquisitions or for other purposes and, if necessary, we may borrow funds to make distributions to our stockholders in order to qualify and maintain our qualification as a REIT for U.S. federal income tax purposes. In addition, we have sold farms in order to repay indebtedness in the past and may do so in the future. Such dispositions may come at inopportune times or on disadvantageous terms, which could result in losses.

In addition, our debt agreements include customary events of default, the occurrence of any of which, after any applicable cure period, would permit the lenders to, among other things, accelerate payment of all amounts outstanding under the loans and to exercise their remedies with respect to the collateral, including foreclosure and sale of the agricultural real estate securing the loans. Certain of our debt agreements also contain cross-default provisions that give the lender the right, in certain circumstances, to declare a default if we are in default under other loans. If any one of these events were to occur, our financial condition, results of operations, cash flow and ability to pay distributions to our stockholders could be materially and adversely affected.

Mortgage debt obligations expose us to the possibility of foreclosure, which could result in the loss of our investment in a property or group of properties subject to mortgage debt.

As of December 31, 2023, we had approximately $363.1 million of outstanding mortgage indebtedness excluding debt issuance costs. We intend to finance future property acquisitions, in part, with mortgage indebtedness. Mortgage and other secured debt obligations increase our risk of property losses because defaults on indebtedness secured by properties may result in foreclosure actions initiated by lenders and ultimately our loss of the property securing any loans for which we are in default. Any foreclosure on a mortgaged property or group of properties could adversely affect the overall value of our portfolio of properties. For tax purposes, a foreclosure on any of our properties that is subject to a nonrecourse mortgage loan would be treated as a sale of the property for a purchase price equal to the outstanding balance of the debt secured by the mortgage. If the outstanding balance of the debt secured by the mortgage exceeds our tax basis in the property, we would recognize taxable income on foreclosure, but would not receive any cash proceeds, which could hinder our ability to meet the REIT distribution requirements imposed by the Code.

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Our debt financing agreements restrict our ability to engage in certain business activities, including our ability to incur additional indebtedness, make capital expenditures and make certain investments.

Our existing debt financing agreements contain, and other debt financing agreements we may enter into in the future may contain customary negative covenants and other financial and operating covenants that, among other things:

restrict our ability to incur additional indebtedness;
restrict our ability to incur additional liens;
restrict our ability to make certain investments (including certain capital expenditures);
restrict our ability to merge with another company;
restrict our ability to sell or dispose of assets;
restrict our ability to make distributions to stockholders; and
require us to satisfy minimum financial coverage ratios, minimum tangible net worth requirements and maximum leverage ratios.

Increases in benchmark interest rates will increase our borrowing costs, which will negatively impact our financial condition, results of operations, growth prospects and ability to make distributions to stockholders.

Beginning in 2022, the Board of Governors of the United States Federal Reserve Bank (the “Federal Reserve”) has undertaken a significant tightening of monetary policy, which has increased borrowing costs (through the resulting increase in interest rates) and decreased credit availability. The Federal Reserve has maintained elevated benchmark interest rates during 2022 and 2023 to help curb inflation, and although the Federal Reserve may reduce benchmark interest rates in 2024, there are no assurances that interest rates will be reduced on the anticipated timeline, and interest rates remain high. Future periods of rising interest rates could increase our borrowing costs on our existing floating-rate indebtedness as well as on any future fixed or floating rate indebtedness used to refinance existing indebtedness or to acquire new properties. As of December 31, 2023, $136.0 million of our outstanding indebtedness was subject to interest rates that reset from time to time (excluding our floating rate debt), of which $43.9 million was subject to interest rates that will be reset in 2024. As of December 31, 2023, the weighted average interest rate of the indebtedness subject to interest rate resets in 2024 was 3.07%, which we expect to increase significantly if benchmark interest rate levels remain constant as we expect them to during the course of 2024 (for more information on rate resets see “Note 7—Mortgage Notes, Lines of Credit and Bonds Payable”). Increases in borrowing costs could reduce our income and cash flow and materially and adversely impact our results of operations, financial condition and our ability to make distributions to our stockholders.

Increases in interest rates will increase our tenants’ borrowing costs and make it more difficult for them to obtain credit and may cause land prices to decline.

Increasing interest rates result in higher borrowing costs for farmers and may make it more difficult for farm operators to obtain indebtedness to fund their operations, which could have an adverse impact on our tenants’ ability to make rental payments to us. Higher interest rates also tend to decrease U.S. and world economic growth, thus decreasing the demand for certain agricultural commodities.

All of these consequences could reduce farm income. If increases in interest rates are not accompanied by higher levels of farm income, this could lead to a reduction in our tenants’ profitability, which could have a material adverse effect on our business or results of operations, financial condition, and ability to make distributions to our stockholders.

We have issued Series A preferred units that may be converted to Common units on or after February 10, 2026, which Common units would be immediately redeemable, for cash or shares of common stock at the Company’s option. The conversion of such Series A preferred units and potential redemption of the converted Common units for shares of common stock could have an immediate dilutive effect on the ownership interests of our common stockholders.  

On or after February 10, 2026 (the “Conversion Right Date”), holders of the Series A preferred units have the right to convert each Series A preferred unit into a number of Common units equal to (i) the $1,000 liquidation preference plus all accrued and unpaid distributions, divided by (ii) the volume-weighted average price per share of the Company’s common

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stock for the 20 trading days immediately preceding the applicable conversion date. All Common units received upon conversion may be immediately tendered for redemption for cash or, at the Company’s option, for shares of common stock on a one-for-one basis, subject to the terms and conditions set forth in the Partnership Agreement. Prior to the Conversion Right Date, the Series A preferred units may not be tendered for redemption by the Holder. To the extent the Series A preferred units are converted to Common units and such Common units are redeemed for shares of common stock, our existing common stockholders would experience an immediate, and potentially significant, dilutive effect on their ownership interest in the Company, which could cause the market price of our common stock to be materially adversely affected.  

Global economic conditions, including inflation and supply chain disruptions, could adversely affect our and our tenants’ operations.

General global economic downturns and macroeconomic trends, including heightened inflation, volatility in the capital markets, interest rate and currency rate fluctuations, the war in Ukraine and the ongoing conflict in the Middle East, changes in trade policies among nations that import and/or export agricultural products and economic slowdown or recession, may result in unfavorable conditions that could negatively affect demand for our tenants’ crops and exacerbate some of the other risks that affect our business, financial condition and results of operations. In addition, during 2022 and 2023 the Federal Reserve repeatedly raised interest rates in response to concerns about inflation. Interest rate increases or other government actions taken to reduce inflation could also result in an economic recession.

Our tenants have experienced challenges in their supply chains and related price increases. Continued deterioration in the domestic or international economic environment may cause decreased demand for our tenants’ crops, which could result in lower sales volume and lower prices for their crops, as well as increase the cost of operating their businesses and a corresponding adverse effect on their ability to make rental payments to us, which would adversely impact our financial condition and results of operations.

Approximately 70% of our portfolio is comprised of properties used to grow primary crops such as corn, soybeans, wheat, rice and cotton, which subjects us to risks associated with primary row crops.

By value, approximately 70% of our portfolio is used for primary crops, such ascorn, soybeans, wheat, rice and cotton. As a result, any development or situation that adversely affects the value of properties generally, or the prices of corn, soybeans, wheat, rice or cotton, could have a more significant adverse impact on us than if our portfolio had less exposure to primary crops, which could materially and adversely impact our financial condition, results of operations and ability to make distributions to our stockholders.

Investments in farmland used for permanent/specialty crops have a different risk profile than farmland used for annual row crops.

By value, approximately 30% of our portfolio is used for permanent crops, and, in the future, we may add to our investments in farmland used for permanent crops, as opposed to annual row crops. Permanent crops have plant structures (such as trees, vines or bushes) that produce yearly crops without being replanted. Examples include blueberries, oranges, apples, almonds and grapes. Permanent crops require more time and capital to plant and bear fruit and are more expensive to replace. If a farmer loses a permanent/specialty crop to drought, flooding, fire or disease, there generally would be significant time and capital needed to return the land to production because a tree or vine may take years to grow before bearing fruit.

Permanent crop plantings also reduce a farmer’s ability to adapt to changing market conditions by changing crops. If demand for one type of permanent crop decreases, the permanent crop farmer cannot easily convert the farm to another type of crop because permanent crop farmland is dedicated to one crop during the lifespan of the trees or vines and therefore cannot easily be rotated to adapt to changing environmental or market conditions.

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Our failure to continue to identify and consummate suitable acquisitions would significantly impede our growth and our ability to further diversify our portfolio by geography, crop type and tenant, which could materially and adversely affect our results of operations and cash available for distribution to our stockholders.

Our ability to expand through farmland acquisitions is important to our business strategy and requires that we identify and consummate suitable acquisition or investment opportunities that meet our investment criteria and are compatible with our growth strategy. We compete for the acquisition of farmland and real estate assets related to farming with many other entities engaged in agricultural and real estate investment activities, including individual and family operators of farming businesses, corporate agriculture companies, financial institutions, institutional pension funds, public REITs, other real estate companies, private equity funds and other private real estate investors. These competitors may prevent us from acquiring desirable properties or may cause an increase in the price we must pay for such properties. Our competitors may adopt transaction structures similar to ours, which would decrease our competitive advantage in offering flexible transaction terms. In addition, the number of entities and the amount of funds competing for suitable investment properties may increase, resulting in increased demand and increased prices paid for these properties. If we pay higher prices for properties, our profitability may decrease, and you may experience a lower return on your investment. Our failure to identify and consummate suitable acquisitions would significantly impede our growth, which would adversely affect our results of operations and cash available for distribution to our stockholders.

Failure to succeed in new markets may have adverse consequences.

We intend to continue to acquire properties across the U.S. and may from time to time evaluate potential international acquisitions. When we acquire properties located in new geographic areas in the U.S. or internationally, or properties primarily devoted to a crop or industry with which we are less familiar (such as certain specialty crops, energy production, dairy farms or hog farms), we may face risks associated with a lack of market knowledge or understanding of the local market, including the availability and identity of quality tenants, forging new business relationships in the area, developing an understanding of a crop or industry unfamiliar to us, and unfamiliarity with local or crop-specific government requirements and procedures. Furthermore, the negotiation of a potential expansion into new markets or industries may divert management time and other resources. As a result, we may have difficulties executing our business strategy in these new markets, which could have a negative impact on our results of operations and ability to make distributions to our stockholders.

We do not continuously monitor and evaluate tenant credit quality, and our financial performance may be subject to risks associated with our tenants' financial condition and liquidity position.

Certain of our leases do not require the full payment of rent in cash in advance of the planting season, which subjects us to credit risk exposure to our farm-operator tenants and the risks associated with farming operations, such as weather, commodity price fluctuations and other factors. We also are exposed to these risks with respect to leases for which the rent is based on a percentage of a tenant's farming revenues and leases with terms greater than one year.Because we do not monitor and evaluate the credit risk exposure related to farm-operator tenants on an ongoing basis, we are subject to the risk that our tenants, particularly those that may depend on leverage to finance their operations, could be susceptible to bankruptcy in the event that their cash flows are insufficient to satisfy their financial obligations, including meeting their obligations to us under their leases. As a result, we may not become aware of a tenant's financial distress until the tenant fails to make payments to us when due, which may significantly reduce the amount of time we have to evict the tenant and re-lease the farmland to a new tenant before the start of the spring planting season, and in the event of a tenant bankruptcy we may not be able to terminate the lease. If we are unable to re-lease the farmland on a timely basis, it could have a material adverse effect on our revenues.

Our short-term leases make us more susceptible to any decreases in prevailing market rental rates than would be the case if we entered into longer-term leases, which could have a material adverse effect on our results of operations and ability to make distributions to our stockholders.

Our leases with tenants engaged in farming operations have terms customary in the farming industry, ranging from one to three years, with some extending up to 40 years (e.g., renewable energy leases). We expect that most of the leases we enter into in the future will have two to seven-year terms. As a result, we are required to frequently re-lease our

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properties upon the expiration of our leases, which will make us more susceptible to declines in market rental rates than we would be if we were to enter into longer term leases. As a result, any decreases in the prevailing market rental rates in the geographic areas in which we own properties could have a material adverse effect on our results of operations and ability to make distributions to our stockholders.

We may be unable to collect balances due on our leases from any tenants in financial distress or bankruptcy, which could materially and adversely affect our financial condition, results of operations and cash flow.

We are subject to tenant credit risk. Our tenants, particularly those that may depend on leverage, could be susceptible to defaults under their leases or bankruptcy in the event that their cash flows are insufficient to satisfy their financial obligations. Certain of our tenants have defaulted on their lease payments, and we have been forced to pursue alternative arrangements with those tenants in order to recover amounts due under the leases. In the future, we may be forced to enter into similar alternative arrangements or pursue litigation in order to collect payments from tenants who are unable make their lease payments as they come due. We can provide no assurances that we will be able to collect the full amount due under a particular lease if we are forced to pursue alternative payment arrangements or litigation with any of our tenants.

If a bankrupt tenant rejects a lease with us, any claim we might have for breach of the lease, excluding a claim against collateral securing the lease, would be treated as a general unsecured claim. In the event of a tenant's default under its lease or its rejection of the lease in bankruptcy proceedings, we may be unable to locate a replacement tenant in a timely manner or on comparable or better terms. As a result, our financial condition, results of operations and ability to make distributions to our stockholders could be adversely affected.

We depend on external sources of capital that are outside of our control and may not be available to us on commercially reasonable terms or at all, which could limit our ability to, among other things, acquire additional properties, meet our capital and operating needs or make the cash distributions to our stockholders necessary to maintain our qualification as a REIT.

In order to maintain our qualification as a REIT, we are required under the Code to, among other things, distribute annually at least 90% of our REIT taxable income, determined without regard to the dividends paid deduction and excluding any net capital gain. In addition, we will be subject to income tax at regular corporate rates to the extent that we distribute less than 100% of our REIT taxable income, including any net capital gains. Because of these distribution requirements, we may not be able to fund future capital needs, including acquisition opportunities and principal and interest payments on any outstanding debt, from operating cash flow. Consequently, we rely on third-party sources to fund our capital needs. We may not be able to obtain such financing on favorable terms, in the time period we desire, or at all. Any debt we incur will increase our leverage, expose us to the risk of default and may impose operating restrictions on us, and any additional equity we raise (including the issuance of common or preferred units) could be dilutive to existing stockholders. Our access to third-party sources of capital depends, in part, on:

general market conditions, including conditions that are out of our control, such as actions or proposed actions of the current U.S. Presidential administration and the Federal Reserve to curb inflation or the impact of future public health crises;
novel and unforeseen market volatility and trading strategies, such as short squeeze-rallies caused by retail investors on retail trading platforms;
the market’s view of the quality of our assets;
the market’s perception of our growth potential;
our debt levels;
our current and expected future earnings;
our cash flow and cash distributions; and
the market price and trading volumeper share of our common stock and Series B Participating Preferred Stock may be highly volatile and low, respectively.stock.

If we cannot obtain capital from third-party sources, we may not be able to acquire properties when strategic opportunities exist, meet the capital and operating needs of our existing properties, satisfy our debt service obligations or make the cash distributions to our stockholders necessary to qualify and maintain our qualification as a REIT.

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Illiquidity of real estate investments could significantly impede our ability to respond to adverse changes in the performance of our properties and harm our financial condition.

The real estate investments made, and to be made, by us may be difficult to sell quickly. As a result, our ability to promptly sell one or more properties in our portfolio in response to liquidity needs, changing economic, financial and investment conditions may be limited or we may have to sell properties at a loss. In addition, we seek to opportunistically dispose of properties when we are able to do so at a price we consider attractive and/or recognize a gain on sale. Return of capital and realization of gains, if any, from an investment generally will occur upon disposition or refinancing of the underlying property. We have used dispositions of assets in the past in order to meet our liquidity requirements. If we are required to dispose of additional assets for liquidity purposes, we may be unable to realize our investment objectives by sale, other disposition or refinancing at attractive prices within any given period of time or may otherwise be unable to complete any exit strategy. Opportunities to dispose of assets at a gain may not be available to us, which would reduce our cash on hand for stock repurchases, distributions to stockholders, or for any other purpose. In particular, weakness in or even the lack of an established market for a property, changes in the financial condition or prospects of prospective purchasers, changes in national or international economic conditions and changes in laws, regulations or fiscal policies of jurisdictions in which the property is located, in each case may limit our ability to dispose of a property.

In addition, the Code imposes restrictions on a REIT’s ability to dispose of properties that are not applicable to other types of real estate companies. In particular, the tax laws applicable to REITs effectively require that we hold our properties for investment, rather than primarily for sale in the ordinary course of business, which may cause us to forego or defer sales of properties that otherwise would be in our best interests. Moreover, if we acquire properties from C corporations (i.e., corporations generally subject to full corporate-level tax) in certain non-taxable transactions, as we have done in the past, built-in gain recognized on the non-taxable disposition of such properties within 5 years of our acquisition will be subject to tax at the highest applicable U.S. federal corporate income tax rate. Therefore, we may not be able to vary our portfolio in response to economic or other conditions promptly or on favorable terms.

Some state laws prohibit or restrict the ownership of agricultural land by business entities, which could impede the growth of our portfolio and our ability to diversify geographically.

Certain states, including Iowa, North Dakota, South Dakota, Minnesota, Oklahoma, Wisconsin, Missouri and Kansas, in which a substantial amount of primary crop farmland is located, have laws that prohibit or restrict to varying degrees the ownership of agricultural land by corporations or business entities like us. As of December 31, 2023, we owned 320 acres of farmland in Kansas, 815 acres in Missouri and 2,114 acres in Oklahoma, and our ownership of those farms may be challenged under Kansas, Missouri or Oklahoma law, in which case we may be required to sell those farms at an unfavorable time and on unfavorable terms. Additional states may, in the future, pass similar or more restrictive laws, and we may not be legally permitted, or it may become overly burdensome or expensive, to acquire properties in these states, which could impede the growth of our portfolio and our ability to diversify geographically in states that might otherwise have attractive investment opportunities.

Our farms are subject to adverse weather conditions, seasonal variability, crop disease and other contaminants, natural disasters and other natural conditions, including the effects of climate change and water availability, which may adversely affect the amount of variable rent or income from direct operations and/or our tenants' ability to pay fixed or variable rent and thereby have a material adverse effect on our results of operations, financial condition, and our ability to make distributions to stockholders.

Crops are vulnerable to adverse weather conditions, including windstorms, tornados, floods, drought and temperature extremes, which are common but difficult to predict, and may occur with higher frequency or be even less predictable in the future due to the effects of climate change. Unfavorable growing conditions can reduce both crop yield and quality. Seasonal factors, including supply and consumer demand, may also have an effect on the value of crops grown by our tenants. In extreme cases, entire harvests may be lost in some geographic areas.

In addition, crops are vulnerable to disease and pests. Damages to tenants’ crops may vary in severity and effect, depending on the stage of production at the time of infection or infestation, the type of treatment applied and climatic conditions. The costs to control these infestations vary depending on the severity of the damage and the extent of the

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plantings affected. These infestations can increase the costs and decrease the revenues of our tenants. Tenants may also incur losses from product recalls, fines or litigation due to other contaminants that may cause food borne illness. It is difficult to predict the occurrence or severity of such product recalls, fines or litigation as well as their impact upon our tenants.

We are particularly susceptible to adverse weather conditions (such as windstorms, tornados, floods, drought, hail and temperature extremes), transportation conditions (including navigation of the Mississippi River), crop disease, pests and other adverse growing conditions in California, Illinois, North Carolina, Colorado and Arkansas, which generate a significant portion of our revenues.

While many of our leases are on a fixed-rent basis that does not change based on the success of the farming operations, we also utilize variable-rent leases pursuant to which the amount of the rent depends on crop yields and prices in regions where such arrangements are prevalent. Adverse weather conditions, seasonal variability, crop disease, pests and contaminants, natural disasters and other natural conditions, including the effects of climate change, could adversely affect the value of production on properties. This could impact our variable rent proceeds and our tenants' ability to continue to meet their obligations to us. This could have a material adverse effect on the value of our properties, our results of operations, financial condition, and our ability to make distributions to our stockholders.

The market prices of the crops that our tenants may produce on our agricultural properties have exhibited periods of volatility, which may affect our tenants' ability to pay rent and thereby have a material adverse effect on our results of operations and our ability to make distributions to stockholders.

The value of a crop is affected by many factors that can differ on a yearly basis. The unpredictability of weather and crop yields in the major crop production regions worldwide creates a significant risk of price volatility, which may either increase or decrease the value of the crops that our tenants produce each year. Other material factors adding to the volatility of crop prices are changes in government regulations and policy, fluctuations in global prosperity, fluctuations in foreign trade and export markets, and eruptions of military conflicts or civil unrest. Although rental payments under the majority of our leases typically are not based on the quality or profitability of our tenants' harvests, any of these factors could adversely affect our tenants' ability to meet their obligations to us and our ability to lease or re-lease properties on favorable terms, or at all, which could have a material adverse effect on the value of our properties, our results of operations and our ability to make distributions to our stockholders.

The impacts of trade disputes and geopolitical conflicts, such as the ongoing war in Ukraine and in the Middle East, could adversely affect the profitability of our tenants’ farming operations, which could have a material adverse effect on our results of operations, financial condition, ability to make distributions to our stockholders and the value of our properties.

The potential for trade disputes between the United States and its primary agricultural trade partners has increased in recent years. This impacts the volatility of the market prices of certain crops that our tenants grow on our properties. There can be no assurances as to the impact of any change in trade policy on market prices of crops.

Similarly, our and our tenants’ operations are subject to risks stemming from geopolitical conflicts, such as the ongoing war in Ukraine and the conflict in the Middle East. Food prices were at near record highs before the beginning of the war in Ukraine and have increased as a result of the war. U.S. farmers have seen increased profitability as a result of rising prices. However, we can provide no assurances that this increased profitability is sustainable in light of inflationary pressures on farming costs, rising interest rates and other economic factors or that such increase will result in commensurate increases in rental rates.

A reduction in crop prices could adversely affect the profitability of our tenants and negatively impact their ability to make rental payments as they come due. If we are unable to recover the rental payments, our results of operations, financial condition and ability to make distributions to our stockholders could be materially and adversely affected. If we are required to remove a tenant, we may not be able to re-lease the property at current rental rates or at all. Furthermore, prolonged trade disputes or geopolitical conflicts that lead to a continuation of depressed crop prices could materially and adversely affect the underlying value of our properties.

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Adverse changes in government policies related to farming could affect the prices of crops and the profitability of farming operations, which could materially and adversely affect the value of our properties and our results of operations.

There are a number of government programs that directly or indirectly affect the profitability of farm operators. These include marketing, export, renewable fuel and insurance policies and programs. Significant changes to or the elimination of programs and policies could adversely affect crop prices and the profitability of farming operations, which could materially and adversely impact the value of our farms and our ability to lease them on favorable terms, or at all, which would have a material adverse effect on our results of operations.

We may be subject to unknown or contingent liabilities related to acquired properties and properties that we may acquire in the future, which could have a material adverse effect on us.

Properties that we have acquired, and properties that we may acquire in the future, may be subject to unknown or contingent liabilities (for example, environmental or related liabilities or liabilities related to water usage) for which we may have no recourse, or only limited recourse, against the sellers. In general, the representations and warranties provided under the transaction agreements related to the purchase of properties that we acquire may not survive the completion of the transactions. Furthermore, indemnification under such agreements may be limited and subject to various materiality thresholds, a significant deductible or an aggregate cap on losses. As a result, there is no guarantee that we will recover any amounts with respect to losses due to breaches by the sellers of their representations and warranties. In addition, the total amount of costs and expenses that may be incurred with respect to liabilities associated with these properties may exceed our expectations, and we may experience other unanticipated adverse effects, all of which may materially and adversely affect us.

The loss of key management personnel, particularly Paul A. Pittman and Luca Fabbri, could have a material adverse effect on our ability to implement our business strategy and to achieve our investment objectives.

Our future success depends to a significant extent on the continued service and coordination of our senior management team. We can provide no assurances that any of our key personnel will continue their employment with us. In particular, the loss of the services of Mr. Paul A. Pittman, our Executive Chairman of the Board of Directors, or Mr. Luca Fabbri, our President, Chief Executive Officer and a member of our Board of Directors, could have a material adverse effect on our ability to implement our business strategy and to achieve our investment objectives.

Joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on co-venturers’ financial condition and disputes between us and our co-venturers.

We have entered into joint investments (including our ownership interest in the OZ Fund) and may in the future, co-invest with third parties through partnerships, joint ventures or other entities, acquiring noncontrolling interests in or sharing responsibility for developing properties and managing the affairs of a property, partnership, joint venture or other entity. With respect to our ownership interest in the OZ Fund and any similar arrangements that we may enter into in the future, we are not, and in the future may not be, in a position to exercise any decision-making authority regarding the property, partnership, joint venture or other entity. Such joint investments in partnerships, joint ventures or other entities may, under certain circumstances, involve risks not otherwise present with a direct investment in farmland properties, including the possibility that partners or co-venturers might become bankrupt or fail to fund their share of required capital contributions. Partners or co-venturers may have economic or other business interests or goals which are inconsistent with our business interests or goals and may be in a position to take actions contrary to our policies or objectives, and they may have competing interests in our markets that could create conflicts of interest. Such investments may also have the potential risk of impasses on decisions, such as a sale or financing, because neither we nor the partner(s) or co-venturer(s) would have full control over the partnership or joint venture. In addition, a sale or transfer by us to a third party of our interests in the joint venture may be subject to consent rights or rights of first refusal, in favor of our joint venture partners, which would in each case restrict our ability to dispose of our interest in the joint venture. Where we are a limited partner or non-managing member in any partnership or limited liability company, if such entity takes or expects to take actions that could jeopardize our status as a REIT or require us to pay tax, we may be forced to dispose of our interest in such entity. Disputes

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between us and partners or co-venturers may result in litigation or arbitration that would increase our expenses and prevent our officers and directors from focusing their time and effort on our business. Consequently, actions by or disputes with partners or co-venturers might result in subjecting properties owned by the partnership or joint venture to additional risk. In addition, we may in certain circumstances be liable for the actions of our third-party partners or co-venturers. Our joint ventures may be subject to debt and, during periods of volatile credit markets, the refinancing of such debt may require equity capital calls.

We may fail to realize some or all of the anticipated benefits of our ownership interest in the OZ Fund, our long-term management agreement with the OZ Fund, the acquisition of MWA and the launch of a joint asset management platform with MWA, or those benefits may take longer to realize than expected. We may also encounter significant difficulties in managing the business and operations of OZ Fund and MWA client properties. The future results of our Company will suffer if we do not effectively manage properties on behalf of the OZ Fund and MWA clients.

Our ability to realize the anticipated benefits of our ownership interest in the OZ Fund, our long-term management agreement with the OZ Fund, the acquisition of MWA and the asset management platform within MWA depends, in part, on our ability to successfully manage the business and operations of OZ Fund and MWA client properties. Following the consummation of the long-term management agreement with the OZ Fund and the acquisition of MWA, the number of acres of third-party farmland under our management increased significantly. If we fail to operate these business lines successfully, we may suffer losses.

Furthermore, our ownership interest in the OZ Fund, the acquisition of MWA and our management of OZ Fund and MWA client properties could expose us to unknown or contingent liabilities that were not discovered during the course of due diligence. These liabilities could include exposure to unexpected environmental problems, compliance and regulatory violations, key employee and client retention problems and other problems that could result in significant costs to us. Many of these factors are outside our control, and any one of them could result in increased costs and liabilities, decreases in the amount of expected revenues, earnings and cash flows, and diversion of management’s time and energy, which could have a material adverse effect on the business of the OZ Fund, MWA and/or us. All of these factors could negatively impact the asset management fees we expect to earn from the management of OZ Fund and MWA client properties and the returns we anticipate receiving from our ownership interest in the OZ Fund and the acquisition of MWA, all of which could negatively impact the price of our common stock, or have a material adverse effect on our business, financial condition and results of operations.

We are exposed to risks associated with the management of third-party owned farmland and ancillary agricultural business activities and failure to succeed in new markets and these new lines of business may have adverse consequences.

Through our long-term management agreement with the OZ Fund, property management business activity within MWA and our November 2022 purchase of land and buildings for four agriculture equipment dealerships in Ohio leased to Ag Pro under the John Deere brand, we engage in property management activities on behalf of third-party property owners and lease out new agricultural-related properties, and may continue to pursue similar strategic activities if appropriate opportunities arise. Our historical experience in our existing markets in acquiring, owning and leasing farmland does not ensure that we will be able to operate successfully in new markets or in new lines of business. We may be exposed to a variety of risks when we enter a new market, property management opportunity or ancillary agricultural business activity, including an inability to accurately evaluate local market conditions and a lack of familiarity with local tenants. We may be unsuccessful in managing farmland properties on behalf of third-parties or leasing out agricultural equipment dealerships, which could have a material adverse effect on our results of operations and we may be liable and/or our status as a REIT may be jeopardized if the third-party farmland management or agricultural equipment dealership facilities cause us to fail to comply with various tax or other regulatory matters.

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If we fail to maintain effective internal controls over financial reporting, we may not be able to accurately report our financial results, which may adversely affect investor confidence in our Company and, as a result, the value of our common stock.

Our management is responsible for establishing and maintaining adequate internal controls over financial reporting. While our Annual Report on Form 10-K for the year ended December 31, 2019 contained an independent auditor’s attestation report pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002, as amended (the “Sarbanes-Oxley Act”), we are not required to include such an audit report in this Annual Report. We have identified material weaknesses in the past. While we believe we have remediated all past material weaknesses, we cannot give any assurances that other material weaknesses will not be identified in the future in connection with our compliance with the provisions of Section 404 of the Sarbanes-Oxley Act. The existence of any material weakness would preclude a conclusion by management and our independent auditors that we maintained effective internal control over financial reporting. Our management may be required to devote significant time and expense to remediate any material weaknesses that may be discovered and may not be able to remediate any material weakness in a timely manner. The existence of any material weakness in our internal control over financial reporting could also result in errors in our financial statements that could require us to restate our financial statements, cause us to fail to meet our reporting obligations and cause investors to lose confidence in our reported financial information, all of which could lead to a decline in the per-share trading price of our common stock. In addition, at the time we no longer qualify as a smaller reporting company, we will be required to include an auditor attestation report pursuant to Section 404 of the Sarbanes Oxley Act, which will cause us to incur additional expenses, which may be significant.

Under the FPI Loan Program, we provide loans to third-party farmers, which exposes us to risks associated with being a lender, including the risk that borrowers default on their obligations to us, which could adversely affect our results of operations and financial condition.

Under the FPI Loan Program, we make loans to third-party farmers (both tenant and non-tenant) to provide financing for borrowers’ working capital requirements and operational farming activities, farming infrastructure projects, and for other farming and agricultural real estate related purposes. As of December 31, 2023, we have made loans to twelve distinct borrowers with original principal amounts totaling $36.7 million. These loans consist of: 15 loan agreements which were originally secured by senior first-lien mortgage loans secured against farmland; one loan is secured by a second mortgage secured against farmland and a personal guaranty; three loan agreements which were originally secured by working capital assets of the borrower; and one loan agreement which was originally secured by equipment of the borrower. As of December 31, 2023, the remaining loan balances total $13.9 million (representing 1% of our total assets as of December 31, 2023), of which $13.4 million were secured by senior first-lien mortgages and $0.5 million was secured by a second mortgage. We intend to make similar loans under the FPI Loan Program in the future. Payments on such loans depend on the profitable operation or management of the farmland or farmland-related property securing the loan or the maintenance of any equipment, or other assets securing the loan. The success of the farmland or farm-related property may be affected by many factors outside the control of the borrower, including adverse weather conditions that prevent the planting of a crop or limit crop yields, declines in market prices for agricultural products (both domestically and internationally) and the impact of government regulations (including changes in price supports, subsidies and environmental regulations). In addition, many farms are dependent on a limited number of key individuals whose injury or death may significantly affect the successful operation of the farm. If the cash flow from a farming operation is diminished, the borrower's ability to repay the loan may be impaired. If a borrower defaults under a loan for which we are the lender, we may attempt to foreclose on the collateral securing the loan, including by acquiring title to the subject property, crops, or equipment, to protect our investment. In response, the defaulting borrower may contest our enforcement of foreclosure or other available remedies, seek bankruptcy protection against our exercise of enforcement or other available remedies, or bring claims against us for lender liability. If a defaulting borrower seeks bankruptcy protection, the automatic stay provisions of the U.S. Bankruptcy Code would preclude us from enforcing foreclosure or other available remedies against the borrower unless relief is first obtained from the court with jurisdiction over the bankruptcy case. In addition, we may be subject to intercreditor agreements that delay, impact, govern or limit our ability to foreclose on a lien securing a loan or otherwise delay or limit our pursuit of our rights and remedies. Any such delay or limit on our ability to pursue our rights or remedies could adversely affect our business, results of operations and ability to make distributions to our stockholders. In the event of a foreclosure, we may assume direct ownership of the underlying farm. Even if we successfully foreclose on the collateral securing our mortgage loans, foreclosure-related costs, high loan-to-value ratios or

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declines in property values could prevent us from realizing the full amount of our mortgage loans, and we could be required to record a valuation allowance for such losses.

Liability for uninsured or underinsured losses could materially and adversely affect our financial condition and cash flow.

Our properties may be damaged by adverse weather conditions and natural disasters, such as earthquakes, floods and tornadoes. Our insurance may not be adequate to cover all damages or losses from these events, or we may view it as not economically prudent to purchase insurance for certain types of losses. Should an uninsured loss occur, we could lose our capital investment or anticipated profits and cash flows from one or more properties. If any such loss is insured, we may be required to pay a significant deductible on any claim for recovery of such a loss prior to our insurer being obligated to reimburse us for the loss, or the amount of the loss may exceed our coverage for the loss, which could have an adverse effect on our cash flow.

We have previously been subject to, and may in the future be subject to, litigation or threatened litigation, which may require us to pay damages and expenses or restrict the operation of our business.

We have previously been subject to, and may be subject in the future, to litigation or threatened litigation, including claims relating to the actions of our tenants, claims brought by stockholders, and otherwise in the ordinary course of business. In particular, we are subject to the risk of complaints by our tenants involving premises liability claims and alleged violations of landlord-tenant laws, which may give rise to litigation or governmental investigations, as well as claims and litigation relating to real estate rights or uses of our properties. Additionally, whether or not any dispute actually proceeds to litigation, we may be required to pay damages or expenses, which may be significant, or involve our agreement with terms that restrict the operation of our business. We generally intend to vigorously defend ourselves; however, we cannot be certain of the ultimate outcomes of pending claims against the Company or of those claims that may arise in the future. Resolution of these types of matters against us may result in our having to pay significant fines, judgments, or settlements, which, if uninsured, or if the fines, judgments, and settlements exceed insured levels, could adversely impact our earnings and cash flows, thereby having an adverse effect on our financial condition, results of operations, cash flows and our ability to pay distributions on, and the per share trading price of, our common stock. Certain litigation or the resolution of certain litigation may affect the availability or cost of some of our insurance coverage and could expose us to increased risks that would be uninsured, and/or adversely impact our ability to attract officers and directors, which could adversely impact our results of operations, cash flows and our ability to pay distributions on, and the value of, our common and preferred stock. For more information about our resolved and ongoing legal proceedings see “Note 8—Commitments and Contingencies” to our Consolidated Financial Statements included in Part IV, Item 8 of this Annual Report on Form 10-K.

We may incur significant unrecoverable costs if we are not successful in connection with the litigation we have filed against Sabrepoint.

As described in further detail in “Note 8—Commitments and Contingencies” to our Consolidated Financial Statements included in Part IV, Item 8 of this Annual Report on Form 10-K, on July 2, 2021, the Company filed a complaint against First Sabrepoint Capital Management, LP, Sabrepoint Capital Partners, LP, Sabrepoint Capital Participation, LP, George Baxter, and Donald Marchiony (collectively, “Sabrepoint”) seeking relief for Sabrepoint’s alleged role in a “short and distort scheme” to profit from an artificial decline in the Company’s stock price stemming from an article posted on Seeking Alpha, which contained numerous false statements about the Company. On December 17, 2021, the Company's claims against Sabrepoint were dismissed by the court , which granted (i) Sabrepoint's motion for summary judgment on collateral estoppel grounds, and (ii) motion to dismiss pursuant to the Texas Citizens Participation Act (“TCPA”). On March 21, 2022, after the Company filed a notice signaling an intent to appeal both orders, the Court of Appeals for the Fifth District of Texas (the “Court of Appeals”) entered an order declaring the trial court's TCPA order “VOID because the motion was denied by operation of law….” Accordingly, the Company narrowed its appeal to the trial court's grant of summary judgment. On January 26, 2022, Sabrepoint filed a motion for attorney's fees relating to the defense of that action. The trial court granted the motion for certain fees claimed by Sabrepoint as relating to its pursuit of its TCPA motion, but as noted above, the Court of Appeals subsequently overturned the TCPA order that formed the basis of Sabrepoint’s fee request, mooting the motion and the Court’s order on the same. On June 30, 2023, the Court of Appeals granted the

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Company’s appeal, determining that the Company’s claims against Sabrepoint are not barred, reversing the trial court and remanding the case for further proceedings on the merits. On October 13, 2023, Sabrepoint filed a Petition for Review with the Texas Supreme Court, requesting the court to review the Court of Appeals’ decision. The Company filed a response to the Sabrepoint Petition for Review with the Texas Supreme Court on December 27, 2023, and on February 16, 2024, the Texas Supreme Court requested a briefing on the merits. The petition is now fully briefed and pending a decision from the court. For more information see “Note 8—Commitments and Contingencies” to our Consolidated Financial Statements included in Part IV, Item 8 of this Annual Report on Form 10-K. We may not be successful in this litigation, in which case we would have incurred significant costs and expenses. Even if we are successful, there can be no assurance that we will be able to recover damages. To the extent that any such adverse effects exceed any benefits we may realize from pursuing this litigation, our business, prospects, financial condition and results of operations may suffer materially.

A cybersecurity incident and other technology disruptions could result in a violation of law or negatively impact our reputation and relationships with our tenants, any of which could have a material adverse effect on our results of operations and our financial condition.

Information and security risks have generally increased in recent years due to the rise in new technologies and the increased sophistication and activities of perpetrators of cyber-attacks. We use computers in substantially all aspects of our business operations, and we also use mobile devices and other online activities to connect with our employees and tenants. Such uses give rise to cybersecurity risks, including security breach, espionage, system disruption, theft and inadvertent release of information. We have in the past experienced cyberattacks on our computers and computer networks, and, while none to date have been material, we expect that additional cyberattacks will occur in the future. Our business involves the storage and transmission of numerous classes of sensitive and/or confidential information and intellectual property, including tenants’, suppliers’ and employees’ personally identifiable information and financial and strategic information about us.

If we fail to assess and identify cybersecurity risks associated with our operations, we may become increasingly vulnerable to such risks. Even the most well protected information, networks, systems and facilities remain potentially vulnerable because the techniques used in such attempted security breaches evolve and generally are not recognized until launched against a target, and in some cases are designed not to be detected and, in fact, may not be detected. Accordingly, we and our suppliers may be unable to anticipate these techniques or to implement adequate security barriers or other preventative measures, and thus it is impossible for us and our suppliers to entirely mitigate this risk. Further, in the future we may be required to expend additional resources to continue to enhance information security measures and/or to investigate and remediate any information security vulnerabilities. We can provide no assurances that the measures we have implemented to prevent security breaches and cyber incidents will be effective in the event of a cyber-attack.

The theft, destruction, loss, misappropriation or release of sensitive and/or confidential information or intellectual property, or interference with our information technology systems or the technology systems of third-parties on which we rely, could result in business disruption, negative publicity, violation of privacy laws, loss of tenants, potential liability and competitive disadvantage, any of which could result in a material adverse effect on financial condition or results of operations.

For more information on cybersecurity, see “Item 1C. Cybersecurity Disclosure.”

Potential liability for environmental matters could materially and adversely affect our results of operations and financial condition.

We are subject to the risk of liabilities under federal, state and local environmental laws applicable to agricultural properties, including those related to wetlands, groundwater and water runoff. Some of these laws could subject us to:

The stock markets, including
responsibility and liability for the New York Stock Exchange (the “NYSE”),cost of removal or remediation of hazardous substances released on our properties, generally without regard to our knowledge of or responsibility for the presence of the contaminants;
liability for the costs of investigation, removal or remediation of hazardous substances or chemical releases at disposal facilities for persons who arrange for the disposal or treatment of these substances; and

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potential liability for claims by third parties for damages resulting from environmental contaminants.

Environmental site assessments were not conducted on all the farms in our portfolio and we do not expect to conduct environment site assessments on all farms we acquire in the future. Our costs of investigation, remediation or removal of hazardous substances may be substantial. In addition, the presence of hazardous substances on one of our properties, or the failure to properly remediate a contaminated property, could adversely affect our ability to sell or lease the property or to borrow using the property as collateral. We may be subject to common law claims by third parties based on damages and costs resulting from environmental contamination emanating from the property. Additionally, we could become subject to new, stricter environmental regulations, which could diminish the utility of our properties and have a material adverse impact on our results of operations and financial condition.

We may be required to permit the owners of certain third-party access rights on our properties to enter and occupy parts of the properties, including owners of mineral rights and power generation and transportation infrastructure, which could materially and adversely impact the rental value of our properties.

Although we own the surface rights to our farms and expect to own the surface rights to properties that we acquire in the future, other persons or entities may own third-party access rights on our properties based upon their ownership of certain minerals, power generation and transportation infrastructure or similar property rights. Some of these third-party access rights, such as those related to oil, water or natural gas may be located under the surfaces of these properties, while others, particularly those third-party access rights related to power generation and transportation infrastructure such as wind turbines or oil pipelines, may be located on or above the surfaces of these properties. For example, in connection with our acquisition of a group of farms in Colorado and Kansas, the seller retained 50% of the mineral rights related to the farm. Currently there is no mineral development or significant power generation and transportation infrastructure on the farms in our portfolio other than on properties for which we own the rights, but we can provide no assurances that third parties will not assert claims for mineral rights, third-party access rights related to power generation and transportation infrastructure and other related property rights on the farms in our portfolio or that farmland that we acquire in the future will not be subject to these third-party access rights. To the extent that third parties have third-party rights on farmland that we currently own or acquire in the future, we expect that we would be required to permit third parties to enter our properties for the purpose of such activities as drilling and operating oil or gas wells, operating and maintaining oil pipelines and operating and maintaining wind turbines on the premises. We may also be required to set aside a reasonable portion of the surface area of our properties to accommodate these operations. The devotion of a portion of our properties to these operations would reduce the amount of the surface available for farming or farm-related uses. Such activities might also disrupt the productivity of the farmland or property related to farming or increase the risk of environmental liabilities, any of which could adversely impact the rents that we receive from leasing these properties.

We are subject to risks associated with public health crises, such as pandemics and epidemics which may have a material adverse effect on our business. The nature and extent of future impacts are highly uncertain and unpredictable.

We are subject to risks associated with public health crises, such as pandemics and epidemics. Our rental revenue and operating results depend significantly on the ability of our tenants to meet their rent and other obligations to us. If the impacts of a future public health crisis continue for an extended period of time, we expect that certain tenants may experience financial distress, which could result in late payments, requests for rental relief, business closures, rent concessions or other accommodations, as applicable. In some cases, we may have to restructure tenants’ long-term rent obligations and may not be able to do so on terms that are as favorable to us as those currently in place.

The scope and duration of any future public health crisis, including the potential emergence of new variants of the COVID-19 virus, the pace at which government restrictions are imposed and lifted, the scope of additional actions taken to mitigate the spread of disease, global vaccination and booster rates, the speed and extent to which global markets and utilization rates for our products fully recover from the disruptions caused by such a public health crisis, and the impact of these factors on our business, financial condition and results of operations, will depend on future developments that are highly uncertain and cannot be predicted with confidence.

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To the extent public health crises adversely affect our operations and global economic conditions more generally, it may also have the effect of heightening many of the other risks described herein.

Risks Related to Our Organizational Structure

Conflicts of interest may exist or could arise in the future between the interests of our stockholders and the interests of holders of units in our Operating Partnership, which may impede business decisions that could benefit our stockholders.

Although holders of our Common units do not have voting rights or the power to direct the Company’s affairs, there could be potential conflicts, conflicts of interest may exist or could arise in the future as a result of the relationships between us and our affiliates, on the one hand, and our Operating Partnership or any partner thereof.

Our directors and officers have duties to our company under Maryland law in connection with their management of our Company. At the same time, our wholly owned subsidiary, Farmland Partners OP GP, LLC, as the general partner of our Operating Partnership, has fiduciary duties and obligations to our Operating Partnership and its limited partners under Delaware law and the partnership agreement in connection with the management of our Operating Partnership. The general partner's fiduciary duties and obligations as the general partner of our Operating Partnership may come into conflict with the duties of our directors and officers to our Company. These conflicts of interest could lead to decisions that are not in the best interests of the Company and its stockholders.

Unless otherwise provided for in a partnership agreement, Delaware law generally requires a general partner of a Delaware limited partnership to adhere to fiduciary duty standards under which it owes its limited partners the highest duties of good faith, fairness and loyalty and which generally prohibit such general partner from taking any action or engaging in any transaction as to which it has a conflict of interest. The partnership agreement provides that, in the event of a conflict between the interests of the limited partners of our Operating Partnership, on the one hand, and the separate interests of our stockholders, on the other hand, the general partner, in its capacity as the general partner of our Operating Partnership, shall act in the interests of our stockholders and is under no obligation to consider the separate interests of the limited partners of our Operating Partnership in deciding whether to cause our Operating Partnership to take or not to take any actions. The partnership agreement further provides that any decisions or actions not taken by the general partner in accordance with the partnership agreement will not violate any duties, including the duty of loyalty, that the general partner, in its capacity as the general partner of our Operating Partnership, owes to our Operating Partnership and its partners.

Additionally, the partnership agreement provides that the general partner will not be liable to our Operating Partnership or any partner for monetary damages for losses sustained, liabilities incurred or benefits not derived by our Operating Partnership or any limited partner unless the general partner acted in bad faith and the act or omission was material to the matter giving rise to the loss, liability or benefit not derived. Our Operating Partnership must indemnify the general partner, us, our directors and officers, officers of our Operating Partnership and others designated by the general partner from and against any and all claims that relate to the operations of our Operating Partnership, unless (1) an act or omission of the indemnified person was material to the matter giving rise to the action and either was committed in bad faith or was the result of active and deliberate dishonesty, (2) the indemnified person actually received an improper personal benefit in money, property or services or (3) in the case of a criminal proceeding, the indemnified person had reasonable cause to believe that the act or omission was unlawful. Our Operating Partnership must also pay or reimburse the reasonable expenses of any such person upon its receipt of a written affirmation of the person's good faith belief that the standard of conduct necessary for indemnification has been met and a written undertaking to repay any amounts paid or advanced if it is ultimately determined that the person did not meet the standard of conduct for indemnification. Our Operating Partnership will not indemnify or advance funds to any person with respect to any action initiated by the person seeking indemnification without our approval (except for any proceeding brought to enforce such person's right to indemnification under the partnership agreement) or if the person is found to be liable to our Operating Partnership on any portion of any claim in the action. No reported decision of a Delaware appellate court has interpreted provisions similar to the provisions of the partnership agreement that modify and reduce our fiduciary duties or obligations as the sole member of the general partner or reduce or eliminate our liability for money damages to our Operating Partnership and its partners, and we have not obtained an opinion of counsel as to the enforceability of the provisions set forth in the partnership

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agreement that purport to modify or reduce the fiduciary duties that would be in effect were it not for the partnership agreement.

Our charter contains certain provisions restricting the ownership and transfer of our stock that may delay, defer or prevent a change of control transaction that might involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests.

Our charter contains certain ownership limits with respect to our stock. Our charter, among other restrictions, prohibits the beneficial or constructive ownership by any person of more than 9.8% in value or number of shares, whichever is more restrictive, of the outstanding shares of any class or series of our stock, excluding any shares that are not treated as outstanding for U.S. federal income tax purposes. Our Board of Directors, in its sole and absolute discretion, may exempt a person, prospectively or retroactively, from this ownership limit if certain conditions are satisfied. This ownership limit as well as other restrictions on ownership and transfer of our stock in our charter may:

discourage a tender offer or other transactions or a change in management or of control that might involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests; and
result in the transfer of shares acquired in excess of the restrictions to a trust for the benefit of a charitable beneficiary and, our Series B Participating Preferred Stock is listed, historically have experienced significant price and volume fluctuations. Asas a result, the market priceforfeiture by the acquirer of our common stock and Series B Participating Preferred Stock is likely to be similarly volatile, and investors in our common stock and Series B Participating Preferred Stock may experience a decrease incertain of the valuebenefits of their shares, including decreases unrelated to our operating performance or prospects. The price of our common stock and Series B Participating Preferred Stock could be subject to wide fluctuations in response to a number of factors, including those listed in this "Risk Factors" section of this Annual Report on Form 10-K and others such as:  owning the additional shares.

We could increase the number of authorized shares of stock, classify and reclassify unissued stock and issue stock without stockholder approval, which may delay, defer or prevent a transaction that our stockholders believe to be in their best interests.

actual or anticipated variations in our quarterly results of operations or dividends;

Our Board of Directors, without stockholder approval, has the power under our charter to amend our charter to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that we are authorized to issue. In addition, under our charter, our Board of Directors, without stockholder approval, has the power to authorize us to issue authorized but unissued shares of our common stock or preferred stock and to classify or reclassify any unissued shares of our common stock or preferred stock into one or more classes or series of stock and set the preference, conversion or other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications or terms or conditions of redemption for such newly classified or reclassified shares. As a result, we may issue series or classes of common stock or preferred stock with preferences, dividends, powers and rights, voting or otherwise, that are senior to, or otherwise conflict with, the rights of holders of our common stock. Although our Board of Directors has no such intention at the present time, it could establish a class or series of preferred stock that could, depending on the terms of such series, delay, defer or prevent a transaction or a change of control that might involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests.

Certain provisions of Maryland law could inhibit changes in control, which may discourage third parties from conducting a tender offer or seeking other change of control transactions that could involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests.

Certain provisions of the Maryland General Corporation Law (the “MGCL”) may have the effect of inhibiting a third party from making a proposal to acquire us or of impeding a change of control under certain circumstances that otherwise could provide the holders of shares of our common stock with the opportunity to realize a premium over the then-prevailing market price of such shares, including:

“business combination” provisions that, subject to limitations, prohibit certain business combinations between us and an “interested stockholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our outstanding voting stock or any affiliate or associate of ours who, at any time within the two-year period immediately prior to the date in question, was the beneficial owner of 10% or more of the voting power of our then outstanding stock) or an affiliate thereof for five years after the most recent date on which the stockholder becomes an interested stockholder and thereafter impose fair price and/or supermajority voting requirements on these combinations; and 
“control share” provisions that provide that “control shares” of our Company (defined as shares which, when aggregated with other shares controlled by the stockholder, except solely by virtue of a revocable proxy, entitle
changes in our funds from operations or earnings estimates;

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the stockholder to exercise one of three increasing ranges of voting power in electing directors) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of issued and outstanding “control shares”) have no voting rights with respect to their control shares except to the extent approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be cast on the matter, excluding all interested shares.

By resolution of our Board of Directors, we have opted out of the business combination provisions of the MGCL and provided that any business combination between us and any other person is exempt from the business combination provisions of the MGCL, provided that the business combination is first approved by our Board of Directors (including a majority of directors who are not affiliates or associates of such persons). In addition, pursuant to a provision in our bylaws, we have opted out of the control share provisions of the MGCL. However, our Board of Directors may by resolution elect to opt in to the business combination provisions of the MGCL and we may, by amendment to our bylaws, opt in to the control share provisions of the MGCL in the future.

Additionally, certain provisions of the MGCL permit our Board of Directors, without stockholder approval and regardless of what is currently provided in our charter or our bylaws, to implement takeover defenses, some of which (for example, a classified board) we do not currently employ. These provisions may have the effect of inhibiting a third party from making an acquisition proposal for our Company or of delaying, deferring, or preventing a change in control of our Company under circumstances that otherwise could provide the holders of our common stock with the opportunity to realize a premium over the then-current market price. Our charter contains a provision whereby we elect to be subject to the provisions of Title 3, Subtitle 8 of the MGCL relating to the filling of vacancies on our Board of Directors.

Our charter, our bylaws and Maryland law also contain other provisions, including the provisions of our charter on removal of directors and the advance notice provisions of our bylaws, that may delay, defer, or prevent a transaction or a change of control that might involve a premium price for our common stock or otherwise be in the best interest of our stockholders.

Certain provisions in the partnership agreement may delay or prevent unsolicited acquisitions of us.

Provisions in the partnership agreement may delay, or make more difficult, unsolicited acquisitions of us or changes of our control. These provisions could discourage third parties from making proposals involving an unsolicited acquisition of us or change of our control, although some of our stockholders might consider such proposals, if made, desirable. These provisions include, among others:

redemption rights;
a requirement that the general partner may not be removed as the general partner of our Operating Partnership without our consent;
transfer restrictions on Common units;
our ability, as general partner, in some cases, to amend the partnership agreement and to cause our Operating Partnership to issue units with terms that could delay, defer or prevent a merger or other change of control of us or our Operating Partnership without the consent of the limited partners; and
the right of the limited partners to consent to direct or indirect transfers of the general partnership interest, including as a result of a merger or a sale of all or substantially all of our assets, in the event that such transfer requires approval by our common stockholders.

Our Board of Directors may change our strategies, policies and procedures without stockholder approval.

Our investment, financing, leverage and distribution policies, and our policies with respect to all other activities, including growth, capitalization and operations, are determined exclusively by our Board of Directors, and may be amended or revised at any time by our Board of Directors without notice to or a vote of our stockholders. This could result in us conducting operational matters, making investments or pursuing different business or growth strategies than those contemplated in this Annual Report on Form 10-K. Further, our charter and bylaws do not limit the amount or percentage of indebtedness, funded or otherwise, that we may incur. Our Board of Directors may alter or eliminate our current policy on borrowing at any time without stockholder approval. If this policy changed, we could become more highly leveraged

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which could result in an increase in our debt service. Higher leverage also increases the risk of default on our obligations. In addition, a change in our investment policies, including the manner in which we allocate our resources across our portfolio or the types of assets in which we seek to invest, may increase our exposure to interest rate risk, real estate market fluctuations and liquidity risk. Changes to our policies with regards to the foregoing could materially adversely affect our financial condition, results of operations and cash flow.

Our rights and the rights of our stockholders to take action against our directors and officers are limited, which could limit your recourse in the event that we take certain actions which are not in our stockholders' best interests.

Maryland law provides that a director or officer has no liability in that capacity if he or she performs his or her duties in good faith, in a manner that he or she reasonably believes to be in our best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances. Under the MGCL, directors are presumed to have acted with this standard of care. As permitted by Maryland law, our charter eliminates the liability of our directors and officers to us and our stockholders for money damages, except for liability resulting from:

actual receipt of an improper benefit or profit in money, property or services; or
active and deliberate dishonesty by the director or officer that was established by a final judgment as being material to the cause of action adjudicated.

Our charter and bylaws obligate us to indemnify each present and former director or officer, to the maximum extent permitted by Maryland law, in the defense of any proceeding to which he or she is made, or threatened to be made, a party by reason of his or her service to us. In addition, we may be obligated to advance the defense costs incurred by our directors and officers. We also have entered into indemnification agreements with our officers and directors granting them express indemnification rights. As a result, we and our stockholders may have more limited rights against our directors and officers than might otherwise exist absent the current provisions in our charter, bylaws and indemnification agreements or that might exist for other public companies.

Our charter contains provisions that make removal of our directors difficult, which could make it difficult for our stockholders to effect changes to our management.

Our charter contains provisions that make removal of our directors difficult, which could make it difficult for our stockholders to effect changes to our senior management and may prevent a change in control of our Company that is in the best interests of our stockholders. Our charter provides that a director may only be removed for cause upon the affirmative vote of holders of two-thirds of all the votes entitled to be cast generally in the election of directors. Vacancies may be filled only by a majority of the remaining directors in office, even if less than a quorum. These requirements make it more difficult to change our senior management by removing and replacing directors and may prevent a change in control of our Company that is in the best interests of our stockholders.

Our Operating Partnership may issue additional Common units or one or more classes of preferred units to third parties without the consent of our stockholders, which would reduce our ownership percentage in our Operating Partnership and could have a dilutive effect on the amount of distributions made to us by our Operating Partnership and, therefore, the amount of distributions we can make to our stockholders.

As of December 31, 2023, we owned approximately 97.6% of the outstanding Common units in our Operating Partnership (on a fully diluted basis). Since our initial public offering, we have issued a total of 8.0 million Common units and a total of 117,000 Series A preferred units as consideration in connection with our acquisition of properties, and we may issue additional Common units and Series A preferred units of one or more classes in connection with our acquisition of properties, as compensation or otherwise. Such issuances would reduce our ownership percentage in our Operating Partnership and could affect the amount of distributions made to us by our Operating Partnership and, therefore, the amount of distributions we can make to our stockholders. Our common stockholders do not have any voting rights with respect to any such issuances or other partnership level activities of our Operating Partnership.

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Certain aspects of our Series A preferred units may limit our ability to make distributions to our common stockholders.

The distribution rate on our Series A preferred units is fixed, and no distributions can be paid to our common stockholders unless we have paid all cumulative dividends on our Series A preferred units. The distribution preference of our Series A preferred units could materially and adversely affect our cash flow and ability to make distributions to our common stockholders.

U.S. Federal Income Tax Risks

Failure to maintain qualification as a REIT for U.S. federal income tax purposes would subject us to U.S. federal income tax on our taxable income at regular corporate rates, which would substantially reduce our ability to make distributions to our stockholders.

We elected to be taxed as a REIT for U.S. federal income tax purposes beginning with our short taxable year ended December 31, 2014. To maintain qualification as a REIT, we must meet various requirements set forth in the Code concerning, among other things, the ownership of our outstanding stock, the nature of our assets, the sources of our income and the amount of our distributions. The REIT qualification requirements are extremely complex, and interpretations of the U.S. federal income tax laws governing qualification as a REIT are limited. We believe that our current organization and method of operation will enable us to continue to qualify as a REIT. However, at any time, new laws, interpretations or court decisions may change the U.S. federal tax laws relating to, or the U.S. federal income tax consequences of, qualification as a REIT. It is possible that future economic, market, legal, tax or other considerations may cause our Board of Directors to determine that it is not in our best interest to qualify as a REIT and to revoke our REIT election, which it may do without stockholder approval.

If we fail to qualify as a REIT for any taxable year, we will be subject to U.S. federal income tax on our taxable income at regular corporate rates. In addition, we generally would be disqualified from treatment as a REIT for the four taxable years following the year in which we lost our REIT status. Losing our REIT status would reduce our net earnings available for investment or distribution because of the additional tax liability. In addition, distributions would no longer qualify for the dividends paid deduction, and we would no longer be required to make distributions. If this occurs, we might be required to borrow funds or liquidate some investments in order to pay the applicable tax.

As a result of all these factors, our failure to qualify as a REIT could impair our ability to expand our business and raise capital, and would substantially reduce our ability to make distributions to our stockholders.

To qualify as a REIT and to avoid the payment of U.S. federal income and excise taxes, we may be forced to borrow funds, use proceeds from the issuance of securities, pay taxable dividends of our stock or debt securities or sell assets to make distributions, which may result in our distributing amounts that may otherwise be used for our operations.

To obtain the favorable tax treatment accorded to REITs, we normally are required each year to distribute to our stockholders at least 90% of our REIT taxable income, determined without regard to the deduction for dividends paid and by excluding net capital gains. We will be subject to U.S. federal income tax on our undistributed taxable income and net capital gain and to a 4% nondeductible excise tax on any amount by which distributions we pay with respect to any calendar year are less than the sum of (1) 85% of our ordinary income, (2) 95% of our capital gain net income and (3) 100% of our undistributed income from prior years. These requirements could cause us to distribute amounts that otherwise would be spent on acquisitions of properties and it is possible that we might be required to borrow funds, use proceeds from the issuance of securities, pay taxable dividends of our stock or debt securities or sell assets in order to distribute enough of our taxable income to maintain our qualification as a REIT and to avoid the payment of U.S. federal income and excise taxes.

Future sales of properties may result in penalty taxes or may be made through TRSs, each of which would diminish the return to you.

It is possible that one or more sales of our properties may be “prohibited transactions” under provisions of the Code. If we are deemed to have engaged in a “prohibited transaction” (i.e., we sell a property held by us primarily for sale in the ordinary course of our trade or business), all income that we derive from such sale would be subject to a 100% tax. The

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Code sets forth a safe harbor for REITs that wish to sell property without risking the imposition of the 100% tax. A principal requirement of the safe harbor is that the REIT must hold the applicable property for not less than two years prior to its sale for the production of rental income. It is entirely possible that a future sale of one or more of our properties will not fall within the prohibited transaction safe harbor.

If we acquire a property that we anticipate will not fall within the safe harbor from the 100% penalty tax upon disposition, we may acquire such property through a TRS in order to avoid the possibility that the sale of such property will be a prohibited transaction and subject to the 100% penalty tax. If we already own such a property directly or indirectly through an entity other than a TRS, we may contribute the property to a TRS. Though a sale of such property by a TRS likely would mitigate the risk of incurring a 100% penalty tax, the TRS itself would be subject to regular corporate income tax at the U.S. federal level, and potentially at the state and local levels, on the gain recognized on the sale of the property as well as any income earned while the property is operated by the TRS. Such tax would diminish the amount of proceeds from the sale of such property ultimately distributable to our stockholders. Our ability to use TRSs in the foregoing manner is subject to limitation. Among other things, the value of our securities in TRSs may not exceed 20% of the value of our assets and dividends from our TRSs, when aggregated with all other non-real estate income with respect to any one year, generally may not exceed 25% of our gross income with respect to such year. No assurances can be provided that we would be able to successfully avoid the 100% penalty tax through the use of TRSs.

In addition, if we acquire any asset from a C corporation (i.e., a corporation generally subject to full corporate-level tax) in a merger or other transaction in which we acquire a basis in the asset determined by reference either to the C corporation’s basis in the asset or to another asset, we will pay tax, at the highest U.S. federal corporate income tax rate, on any built-in gain recognized on a taxable disposition of the asset during the 5-year period after its acquisition. As a result of the manner in which we acquired the Hudye Farm in 2014, a subsequent taxable disposition by us of any such assets generally would be subject to the foregoing built-in gain rules.

In certain circumstances, we may be subject to U.S. federal and state income taxes as a REIT, which would reduce our cash available for distribution to our stockholders.

Even if we qualify as a REIT, we may be subject to U.S. federal income taxes or state taxes. As discussed above, net income from a “prohibited transaction” will be subject to a 100% penalty tax and built-in gain recognized on the taxable disposition of assets acquired from C corporations in certain non-taxable transactions will be subject to tax at the highest applicable U.S. federal corporate income tax rate. To the extent we satisfy the distribution requirements applicable to REITs, but distribute less than 100% or our taxable income, we will be subject to U.S. federal income tax at regular corporate rates on our undistributed income. We may not be able to make sufficient distributions to avoid excise taxes applicable to REITs. We may also decide to retain capital gains we earn from the sale or other disposition of our properties and pay income tax directly on such income. In that event, our stockholders would be treated as if they earned that income and paid the tax on it directly. However, our stockholders that are tax-exempt, such as charities or qualified pension plans, would have no benefit from their deemed payment of such tax liability. We may also be subject to state and local taxes on our income or property, either directly or at the level of the companies through which we indirectly own our assets. Any U.S. federal or state taxes we pay will reduce our cash available for distribution to our stockholders.

The ability of our Board of Directors to revoke or otherwise terminate our REIT qualification without stockholder approval may cause adverse consequences to our stockholders.

Our charter provides that our Board of Directors may revoke or otherwise terminate our REIT election, without the approval of our stockholders, if it determines that it is no longer in our best interest to continue to qualify as a REIT. If we cease to qualify as a REIT, we would become subject to U.S. federal income tax on our taxable income at regular corporate rates and would no longer be required to distribute most of our taxable income to our stockholders, which may have adverse consequences on our total return to our stockholders.

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changes in government regulations or policies affecting our business or the farming business; 
publication of research reports about us or the real estate or farming industries; 
sustained decreases in agricultural commodity and crop prices; 
increases in market interest rates that lead purchasers of our common stock to demand a higher yield;
increases in market interest rates that decrease demand for our Series B Participating Preferred Stock;
changes in market valuations of similar companies; 
adverse market reaction to any additional debt we incur in the future;
additions or departures of key management personnel; 
actions by institutional stockholders; 
speculation in the press or investment community; 
the realization of any of the other risk factors presented in this Annual Report on Form 10-K; 
the extent of investor interest in our securities; 
the general reputation of REITs and the attractiveness of our equity securities in comparison to other equity securities, including securities issued by other real estate-based companies; 
our underlying asset value; 
investor confidence in the stock and bond markets generally; 
changes in tax laws; 
future equity issuances; 
failure to meet earnings estimates; 
failure to meet and maintain REIT qualifications and requirements; 
low trading volume of our common stock or Series B Participating Preferred Stock; and 
general market and economic conditions, including conditions that are outside of our control, such as the impact of public health and safety concerns, such as the ongoing coronavirus pandemic and efforts to mitigate its spread.

If our Operating Partnership were classified as a “publicly traded partnership” taxable as a corporation for U.S. federal income tax purposes, we would fail to qualify as a REIT and would suffer other adverse tax consequences.

We intend for our Operating Partnership to be treated as a “partnership” for U.S. federal income tax purposes. If the IRS were to successfully assert our Operating Partnership was “publicly traded,” our Operating Partnership could be taxable as a corporation if less than 90% of its gross income consisted of certain qualifying passive income. In such event, we likely would fail to qualify as a REIT for U.S. federal income tax purposes, and the resulting corporate income tax burden would reduce the amount of distributions that our Operating Partnership could make to us. This would substantially reduce the cash available to pay distributions to our stockholders.

Complying with the REIT requirements may cause us to forego otherwise attractive opportunities or sell properties earlier than we wish.

To maintain our qualification as a REIT for U.S. federal income tax purposes, we must continually satisfy tests concerning, among other things, the sources of our income, the nature and diversification of our assets, the amounts we distribute to our stockholders and the ownership of shares of our stock. We may be required to make distributions to our stockholders at disadvantageous times or when we do not have funds readily available for distribution, or we may be required to forego or liquidate otherwise attractive investments in order to comply with the REIT tests. Thus, compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits.

You may be restricted from acquiring or transferring certain amounts of our common stock.

Certain provisions of the Code and the stock ownership limits in our charter may inhibit market activity in our capital stock and restrict our business combination opportunities. In order to maintain our qualification as a REIT, five or fewer individuals, as defined in the Code, may not own, beneficially or constructively, more than 50% in value of our issued and outstanding stock at any time during the last half of a taxable year. Attribution rules in the Code determine if any individual or entity beneficially or constructively owns our capital stock under this requirement. Additionally, at least 100 persons must beneficially own our capital stock during at least 335 days of a taxable year. To help ensure that we meet these tests, our charter restricts the acquisition and ownership of shares of our stock.

Our charter, with certain exceptions, authorizes our Board of Directors to take such actions as are necessary and desirable to preserve our qualification as a REIT. Unless exempted by our Board of Directors, our charter prohibits any person from beneficially or constructively owning more than 9.8% in value or number of shares, whichever is more restrictive, of the outstanding shares of any class or series of our capital stock. Our Board of Directors may not grant an exemption from these restrictions to any proposed transferee whose ownership in excess of such ownership limit would result in our failing to qualify as a REIT.

Dividends paid by REITs generally do not qualify for the favorable tax rates available for some dividends.

The maximum U.S. federal income tax rate applicable to qualified dividend income paid to U.S. stockholders that are individuals, trusts and estates currently is 20%. Dividends paid by REITs generally are not eligible for such reduced tax rate. Instead, our ordinary dividends generally are taxed at the higher tax rates applicable to ordinary income, the current maximum rate of which is 37%. Although the favorable tax rates applicable to qualified dividend income do not adversely affect the taxation of REITs or dividends paid by REITs, such favorable tax rates could cause investors who are individuals, trusts and estates to perceive investments in REITs to be relatively less attractive than investments in the stocks of non-REIT corporations that pay dividends, which could adversely affect the value of the shares of REITs, including our common stock. However, for taxable years prior to 2026, individual stockholders are generally allowed to deduct 20% of the aggregate amount of ordinary dividends distributed by us, subject to certain limitations, which would reduce the maximum marginal effective federal income tax rate for individuals on the receipt of such ordinary dividends to 29.6%.

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Changes to the U.S. federal income tax laws, including the enactment of certain tax reform measures, could have an adverse impact on our business and financial results.

In recent years, numerous legislative, judicial and administrative changes have been made to the U.S. federal income tax laws applicable to investments in real estate and REITs. There can be no assurance that future changes to the U.S. federal income tax laws or regulatory changes will not be proposed or enacted that could impact our business and financial results. The REIT rules are regularly under review by persons involved in the legislative process and by the Internal Revenue Service and the U.S. Treasury Department, which may result in revisions to regulations and interpretations in addition to statutory changes. If enacted, certain of such changes could have an adverse impact on our business and financial results.

We cannot predict whether, when or to what extent any new U.S. federal tax laws, regulations, interpretations or rulings will impact the real estate investment industry or REITs. Prospective investors are urged to consult their tax advisors regarding the effect of potential future changes to the federal tax laws on an investment in our shares.

In the past, securities class action litigation has often been instituted against companies following periods of volatility in the price of their common stock. This type of litigation could result in substantial costs and divert our management's attention and resources, which could have a material adverse effect on us, including our financial condition, results of operations, cash flow and the per share trading price of our common stock.

Our common stock is subject to trading risks created by the spread of false information and manipulative trading.

Our common stock is widely traded and held by a diverse group of investors, including retail investors, and these investors are subject to the influence of information provided by third party investor websites and independent authors distributing information on the internet. This information is often widely distributed, in some cases anonymously, including through platforms that mainly serve as hosts seeking advertising revenue. These sites and internet distribution strategies create opportunities for individuals to pursue both “pump and dump” and “short and distort” strategies. We believe that many of these websites have little or no requirements for authors to have professional qualifications. While these sites sometimes require disclosure of stock positions by authors, as far as we are aware these sites do not audit the accuracy of such conflict of interest disclosures. In addition, we believe that many of these websites have few or lax editorial standards, and thin or non-existent editorial staffs. Despite our best efforts, we may not be able to obtain corrections to information provided on these websites about our Company, and any corrections that are obtained may not be achieved prior to the majority of audience impressions being formed for a given article. These conditions create volatility and risk for holders of our common stock and should be considered by investors. While we have sought to engage regulators to address activities that we believe are intentionally misleading, we can make no guarantees that regulatory authorities will take action on these types of activities, and we cannot guarantee that any action taken by regulators or legislators will timely address damage done by the activities of these websites and authors.

The number of shares of our common stock available for future issuance or sale may have adverse effects on the market price of our common stock.

As of December 31, 2020, approximately 30.6 million shares of our common stock were outstanding. In addition, as of the date of this Annual Report on Form 10-K, other than the Common units held by us, approximately 1.6 million

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Common units in our operating partnership were outstanding, 1.6 million of which currently may be tendered for redemption by the holders, for cash, or at our option, for shares of our common stock, on a one-for-one basis. We have registered the issuance of 1.6 million of the shares issuable upon redemption of Common units, and we intend to register the issuance of additional shares that may be issued upon redemption of Common units so that such shares will be freely tradable under the securities laws.

We cannot predict whether future issuances or sales of shares of our common stock or the availability of shares for resale in the open market will decrease the per share trading price per share of our common stock. The per share trading price of our common stock may decline significantly when we register the shares of our common stock issuable upon redemption of outstanding Common units.

Future offerings of debt, which would be senior to our common stock upon liquidation, our Series B Participating Preferred Stock and other preferred equity securities, which may be senior to our common stock for purposes of dividend distributions or upon liquidation, and Common units in connection with future acquisitions may materially adversely affect us, including the per share trading price of our common stock.

In the future, we may attempt to increase our capital resources by making additional offerings of debt or equity securities (or causing our operating partnership to issue debt securities), including medium-term notes, senior or subordinated notes and classes or series of preferred stock. Upon liquidation, holders of our debt securities and shares of preferred stock, including our Series B Participating Preferred Stock, and lenders with respect to other borrowings will be entitled to receive payments prior to distributions to the holders of our common stock. Additionally, any convertible or exchangeable securities that we issue in the future may have rights, preferences and privileges more favorable than those of our common stock and may result in dilution to owners of our common stock. Holders of our common stock are not entitled to preemptive rights or other protections against dilution. Our Series B Participating Preferred Stock has a preference on liquidating distributions and a preference on dividend payments that could limit our ability to pay dividends to the holders of our common stock, as could any future series of preferred stock. Because our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of our future offerings. Thus, our stockholders bear the risk that our future offerings could reduce the per share trading price of our common stock and dilute their interest in us. In addition, the issuance of Common units in connection with future acquisitions and the redemption of such Common units for common stock may be dilutive to our stockholders and could have an adverse effect on the per share trading price of our common stock.

Our Series B Participating Preferred Stock is subordinate to our existing and future debt and other liabilities, and could be diluted by the issuance of additional preferred stock and by other transactions.

Our Series B Participating Preferred Stock is subordinate to all of our existing and future debt. Our existing debt restricts, and our future debt may include restrictions on, our ability to pay dividends to preferred stockholders in the event of a default under the debt facilities. Additionally, the issuance of additional shares of preferred stock on parity with or senior to the Series B Participating Preferred Stock would dilute the interests of the holders of the Series B Participating Preferred Stock, and any issuance of shares of preferred stock senior to the Series B Participating Preferred Stock or of additional indebtedness could affect our ability to pay dividends on, redeem or pay the liquidation preference on our Series B Participating Preferred Stock.

None of the provisions relating to the Series B Participating Preferred Stock relate to or limit our indebtedness or afford the holders of the Series B Participating Preferred Stock protection in the event of a highly leveraged or other transaction, including a merger or the sale, lease or conveyance of all or substantially all of our assets or business, that might adversely affect the holders of the Series B Participating Preferred Stock.

An increase in market interest rates may have an adverse effect on the market price of our common stock or Series B Participating Preferred Stock

One of the factors that investors may consider in deciding whether to buy or sell our common stock or Series B Participating Preferred Stock is our distribution yield, which is our distribution rate as a percentage of the share price of our common stock or Series B Participating Preferred Stock, relative to market interest rates. If market interest rates increase, prospective investors may desire a higher distribution yield on our common stock or Series B Participating

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Preferred Stock or may seek securities paying higher dividends or interest. The market price of our common stock or Series B Participating Preferred Stock likely will be based primarily on the earnings that we derive from rental income with respect to our properties and our related distributions to stockholders, and not from the underlying appraised value of the properties themselves. As a result, interest rate fluctuations and capital market conditions are likely to affect the market price of our common stock and our Series B Participating Preferred Stock, and such effects could be significant. For instance, if interest rates rise without an increase in our distribution rate, the market price of our common stock or Series B Participating Preferred Stock could decrease because potential investors may require a higher distribution yield on our common stock or Series B Participating Preferred Stock as market rates on interest-bearing securities, such as bonds, rise.

Item 1B.  Unresolved Staff Comments

None.

Item 2. Properties

The information set forth under the caption “Our Properties” in Item 1 of this Annual Report on Form 10-K is incorporated by reference herein.

Item 3. Legal Proceedings

For information regarding legal proceedings as of December 31, 2020, see Note 8 to our Consolidated Financial Statements included in Part IV, Item 8 of this Annual Report on Form 10-K.

Item 4. Mine Safety Disclosures

Not Applicable.

PART II

Item 5. 5

Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

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Item 6

[Reserved]

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Item 7

Management’s Discussion and Analysis of Financial Condition and Results of Operations

45

Item 7A

Quantitative and Qualitative Disclosures About Market Risk

60

Item 8

Financial Statements and Supplementary Data

60

Item 9

Changes and Disagreements with Accountants on Accounting and Financial Disclosure

60

Item 9A

Controls and Procedures

60

Item 9B

Other Information

61

Item 9C

Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

61

PART III

Item 10

Directors, Executive Officers and Corporate Governance

61

Item 11

Executive Compensation

61

Item 12

Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

61

Item 13

Certain Relationships and Related Transactions, and Director Independence

61

Item 14

Principal Accountant Fees and Services

62

PART IV

Item 15

Exhibits and Financial Statement Schedules

62

Item 16

Form 10-K Summary

62

Signatures

66

2

SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS

We make statements in this Annual Report on Form 10-K that are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 (set forth in Section 27A of the Securities Act of 1933, as amended (the “Securities Act”), and Section 21E of the Securities Exchange Act of 1934, as amended (the “Exchange Act”)). These forward-looking statements include, without limitation, statements concerning pending acquisitions and dispositions, projections, predictions, expectations, estimates or forecasts as to our business, financial and operational results, future stock repurchases and other transactions affecting our capitalization, our dividend policy, future economic performance, crop yields and prices and future rental rates for our properties, ongoing litigation, as well as statements of management’s goals and objectives and other similar expressions concerning matters that are not historical facts. When we use the words “may,” “should,” “could,” “would,” “predicts,” “potential,” “continue,” “expects,” “anticipates,” “future,” “intends,” “plans,” “believes,” “estimates” or similar expressions or their negatives, as well as statements in future tense, we intend to identify forward-looking statements. Although we believe that the expectations reflected in such forward-looking statements are based upon reasonable assumptions, beliefs and expectations, such forward-looking statements are not predictions of future events or guarantees of future performance, and our actual results could differ materially from those set forth in the forward-looking statements. Some factors that might cause such a difference include the following: the ongoing war in Ukraine and the conflict in the Middle East and their impact on our tenants’ businesses and the farm economy generally, changes in trade policies in the United States and other countries who import U.S. agricultural products, high inflation and increasing interest rates, the onset of an economic recession in the United States and other countries that impact the farm economy, extreme weather events, such as droughts, tornadoes, hurricanes or floods, the impact of future public health crises on our business and on the economy and capital markets generally, general volatility of the capital markets and the market price of our common stock, changes in our business strategy, availability, terms and deployment of capital, our ability to refinance existing indebtedness at or prior to maturity on favorable terms, or at all, availability of qualified personnel, changes in our industry or the general economy, the degree and nature of our competition, the outcomes of ongoing litigation, our ability to identify new acquisitions or dispositions and close on pending acquisitions or dispositions and the other factors described in the risk factors described in Item 1A, “Risk Factors” of this Annual Report on Form 10-K and in other documents that we file from time to time with the SEC. Given these uncertainties, undue reliance should not be placed on such statements. We assume no obligation to update forward-looking statements to reflect actual results, changes in assumptions or changes in other factors affecting forward-looking statements, except to the extent required by law.

Summary Risk Factors

Our business is subject to a number of risks, including risks that may prevent us from achieving our business objectives or may adversely affect our business, financial condition, results of operations, cash flows and prospects. The following is an overview of the most significant risks to which we are exposed in the normal course of our business and which are discussed more fully in “Item 1A. Risk Factors” herein. These risks include, but are not limited to, the following:

Market Information

Our business is dependent in part upon the profitability of our tenants' farming operations, and a sustained downturn in the profitability of their farming operations could have a material adverse effect on the amount of rent we can collect and, consequently, our cash flow and ability to make distributions to our stockholders.

Our common stock trades on
We have a substantial amount of indebtedness outstanding, which may expose us to the NYSErisk of default under the symbol “FPI.”

our debt obligations, restrict our operations and our ability to grow our business and revenues, and restrict our ability to pay distributions to our stockholders.

Stock Performance Graph

Mortgage debt obligations expose us to the possibility of foreclosure, which could result in the loss of our investment in a property or group of properties subject to mortgage debt.

The following graph compares the total stockholder return
Increases in benchmark interest rates will increase our borrowing costs, which will negatively impact our financial condition, results of our common stock (assuming reinvestment of dividends) against the cumulative returns of the Standard & Poor’s Corporation Composite 500 Indexoperations, growth prospects and the SNL Financial REIT Index, or the SNLUS REITs for the period from April 16, 2014, the date of the initial listing of our common stock on the NYSE MKTability to December 31, 2020. Our common stock began trading on the NYSE on September 8, 2015.

make distributions to stockholders.

38

3

Graphic

Increases in interest rates will increase our tenants’ borrowing costs and may make it more difficult for them to obtain credit.

Period Ending

Index

12/31/15

12/31/16

12/31/17

12/31/18

12/31/19

12/31/20

Farmland Partners Inc.

100.00

106.52

87.51

48.02

73.87

97.58

S&P 500 Index

100.00

111.96

136.40

130.42

171.49

203.04

SNL U.S. REIT Equity Index

100.00

108.88

118.00

112.46

144.54

137.09

SNL U.S. REITs < $250M Implied Cap Index

100.00

118.33

145.11

117.85

81.04

31.67

Global economic conditions, including inflation, supply chain disruptions and trade policies affecting imports and exports, could adversely affect our and our tenants’ operations.

Distribution Information

Approximately 70% of our portfolio is comprised of properties used to grow primary crops such as corn, soybeans, wheat, rice and cotton, which subjects us to risks associated with primary row crops.

Since
Our farms are exposed to the possibility of extreme weather events, such as droughts, tornadoes, hurricanes and floods, which could damage the farmland and equipment, adversely affect crop yields and the ability of farmers to pay rent to us or adversely impact the financing of such properties.

Investments in farmland used for permanent/specialty crops have a different risk profile than farmland used for annual row crops.

Our failure to continue to identify and consummate suitable acquisitions would significantly impede our initial quarter asgrowth and our ability to further diversify our portfolio by geography, crop type and tenant, which could materially and adversely affect our results of operations and cash available for distribution to our stockholders.

We do not intend to continuously monitor and evaluate tenant credit quality, and our financial performance may be subject to risks associated with our tenants' financial condition and liquidity position.

Our short-term leases make us more susceptible to any decreases in prevailing market rental rates than would be the case if we entered into longer-term leases, which could have a publicly traded REIT, we have made regular quarterlymaterial adverse effect on our results of operations and ability to make distributions to our stockholders. We intend to continue to declare quarterly distributions. However, beginning with the third quarter of 2018, we significantly reduced distribution amounts on our common stock, and we cannot provide any assurance as to the amount or timing of future distributions.

Our
We depend on external sources of capital that are outside of our control and may not be available to us on commercially reasonable terms or at all, which could limit our ability to, among other things, acquire additional properties, meet our capital and operating needs or make the cash distributions in the future will depend uponto our actual results of operations and earnings, economic conditions and other factors that could differ materially from our current expectations, including the impact of ongoing litigation. Our actual results of operations will be affected by a number of factors, including the revenue we receive from our properties, our operating expenses, interest expense, the ability of our tenants to meet their obligations and unanticipated expenditures. For more information regarding risk factors that could materially adversely affect our actual results of operations, see "Risk Factors." Any future distributions will be authorized by our Board of Directors in its sole discretion out of funds legally available therefor and will be dependent upon a number of factors, including restrictions under applicable law, the capital requirements of our company and the distribution requirementsstockholders necessary to qualify and maintain our qualification as a REIT.

Laws in certain states where we own property prohibit or restrict the ownership of agricultural land by business entities, which could impede the growth of our portfolio and our ability to diversify geographically.

We may be subject to unknown or contingent liabilities related to acquired properties and properties that we may acquire in the future, which could have a material adverse effect on us.

We may be required to fund distributions from working capitalpermit the owners of certain third-party access rights on our properties to enter and occupy parts of the properties, including owners of mineral rights and power generation and transportation infrastructure, which could materially and adversely impact the rental value of our properties.

We have previously been subject to, and may in the future be subject to, litigation or borrowthreatened litigation, which may require us to providepay damages and expenses or restrict the operation of our business.

39
Conflicts of interest may exist or could arise in the future between the interests of our stockholders and the interests of holders of units in our Operating Partnership, which may impede business decisions that could benefit our stockholders.

4

funds
Our charter contains certain provisions restricting the ownership and transfer of our stock that may delay, defer or prevent a change of control transaction that might involve a premium price for such distributions, or we may choose to make a portion of the required distributions in the form of a taxable stock dividend to preserve our cash balance or reduce our distribution.  No distributions can be paid on our common stock unless we have paid all cumulative dividendsor that our stockholders otherwise believe to be in their best interests.

We could increase the number of authorized shares of stock, classify and reclassify unissued stock and issue stock without stockholder approval, which may delay, defer or prevent a transaction that our stockholders believe to be in their best interests.

Our Board of Directors may change our strategies, policies and procedures without stockholder approval.

Our charter contains provisions that make removal of our directors difficult, which could make it difficult for our stockholders to effect changes to our management.

Failure to maintain qualification as a REIT for U.S. federal income tax purposes would subject us to U.S. federal income tax on our Series A preferred units and Series B Participating Preferred Stock. The distribution preference of our Series A preferred units and Series B Participating Preferred Stock could limittaxable income at regular corporate rates, which would substantially reduce our ability to make distributions to our stockholders.

Complying with the holdersREIT requirements may cause us to forego otherwise attractive opportunities or sell properties earlier than we wish.

We may be unable to make distributions at expected levels, which could result in a decrease in the market price of our common stock.

We are subject to risks associated with public health crises, such as pandemics and epidemics, which may have a material adverse effect on our business. The nature and extent of future impacts are highly uncertain and unpredictable.

5

PART I

Item 1. Business

Our Company

Farmland Partners Inc. (“FPI”), collectively with its subsidiaries, is an internally managed real estate company that owns and seeks to acquire high-quality farmland located in agricultural markets throughout North America. FPI was incorporated in Maryland on September 27, 2013. FPI elected to be taxed as a real estate investment trust (“REIT”) under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with its short taxable year ended December 31, 2014.

FPI is the sole member of the sole general partner of Farmland Partners Operating Partnership, LP (the “Operating Partnership”), which was formed in Delaware on September 27, 2013. All of FPI’s assets are held by, and its operations are primarily conducted through, the Operating Partnership and the wholly owned subsidiaries of the Operating Partnership. As of December 31, 2023, FPI owned a 97.6% interest in the Operating Partnership. See “Note 9—Stockholders’ Equity and Non-controlling Interests” for additional discussion regarding Class A Common units of limited partnership interest in the Operating Partnership (“Common units”), Series A preferred units of limited partnership interest in the Operating Partnership (“Series A preferred units”) and Series B participating preferred units of limited partnership interest in the Operating Partnership (“Series B participating preferred units”). Unlike holders of FPI’s common stock, par value $0.01 per share (“common stock”), holders of the Operating Partnership’s Common units and Series A preferred units generally do not have voting rights or the power to direct the affairs of FPI.

References to the “Company,” “we,” “us,” or “our” mean collectively FPI and its consolidated subsidiaries, including the Operating Partnership.

Our primary strategic objective is to utilize our position as a leading institutional acquirer, owner and manager of high-quality farmland located in agricultural markets throughout North America to deliver strong risk adjusted returns to investors through a combination of cash dividends and asset appreciation. As of December 31, 2023, we owned farms with an aggregate of approximately 132,800 acres in Arkansas, California, Colorado, Florida, Illinois, Indiana, Kansas, Louisiana, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, South Carolina and Texas. In addition, as of December 31, 2023, we owned land and buildings for four agriculture equipment dealerships in Ohio leased to Ag-Pro Ohio, LLC (“Ag Pro”) under the John Deere brand and served as property manager for approximately 38,300 acres, including farms in Iowa (see “Note 4—Related Party Transactions”). As of December 31, 2023, the Operating Partnership owned a 9.97% equity interest in Promised Land Opportunity Zone Farms I, LLC (the “OZ Fund”), an unconsolidated equity method investment, that holds 12 properties (see “Note 1, Convertible Notes Receivable”). As of December 31, 2023, approximately 70% of our owned portfolio (by value) was used to grow primary crops, such as corn, soybeans, wheat, rice and cotton, and approximately 30% was used to produce specialty crops, such as almonds, citrus, blueberries, and vegetables. We believe our portfolio gives investors the economic benefit of increasing global food demand in the face of growing scarcity of high-quality farmland and will continue to reflect the approximate allocation of U.S. agricultural output between primary crops and animal protein (whose production relies principally on primary crops as feed), on one hand, and specialty crops, on the other. 

In addition, we offer a loan program (the “FPI Loan Program”) pursuant to which we make loans to third-party farmers (both tenant and non-tenant) to provide financing for property acquisitions, working capital requirements, operational farming activities, farming infrastructure projects and for other farming and agricultural real estate related projects.

FPI Agribusiness Inc., a wholly owned subsidiary (the “TRS” or “FPI Agribusiness”), is a taxable REIT subsidiary that was formed to provide volume purchasing servicesto the Company’s tenants and to directly operate farms under certain circumstances. As of December 31, 2023, the TRS performed direct farming operations on 2,103 acres of permanent crop farmland owned by the Company located in California.

FPI strategically seeks opportunities to promote environmentally friendly usage of our farmland. We have long-term lease arrangements on certain farm properties pursuant to which operators engage in solar and wind energy production.

6

As of December 31, 2023, 15 of our farms, which collectively comprised approximately 10,150 acres, had leases for operational or under-construction renewable energy production, and 16 of our farms, which collectively comprise approximately 12,875 acres, had options for potential future solar or wind development and operating lease. Refer to “–Sustainability” for more information.

Our principal source of revenue is rent from tenants that conduct farming operations on our farmland pursuant to leases with terms ranging primarily from one to three years. The majority of the leases that are in place as of the date of this Annual Report on Form 10-K have fixed rent payments. Some of our leases have variable rents based on the revenue generated by our farm-operator tenants. We believe that a mix of fixed and variable rents will help insulate us from the variability of farming operations and reduce our credit-risk exposure to farm-operator tenants while making us an attractive landlord in certain regions where variable leases are customary. However, we may be exposed to tenant credit risk and farming operation risks, particularly with respect to leases that do not require advance payment of 100% of the fixed rent, variable rent arrangements and leases with terms greater than one year.

Full Year 2023 Highlights

During 2023:

Net income increased 164.9% from $12.0 million for the year ended December 31, 2022 to $31.7 million for the year ended December 31, 2023;
Adjusted Funds from Operation ("AFFO") decreased 48.4% from $15.8 million for the year ended December 31, 2022 to $8.1 million for the year ended December 31, 2023;
We completed dispositions consisting of 74 properties in the Corn Belt, Delta and South, High Plains, Southeast and West Coast regions. We received $195.5 million in aggregate consideration, including $11.8 million in seller financing, and recognized an aggregate gain on sale of $36.1 million;
We completed acquisitions consisting of four properties in the Corn Belt and Delta and South regions. Aggregate cash consideration for these acquisitions totaled $22.2 million;
We repurchased 6,551,087 shares of our common stock at a weighted average price of $11.00 per share;
Total indebtedness decreased $76.4 million from $439.5 million at December 31, 2022 to $363.1 million at December 31, 2023;
We increased liquidity to $206.6 million as of December 31, 2023, compared to $176.7 million as of December 31, 2022; and
We renewed fixed cash farm leases expiring in 2023 at average rent increases of approximately 20%.

For a definition of AFFO and a reconciliation of net income to AFFO, see “Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations – Non-GAAP Financial Measures.”

Investment Focus

We seek to invest in farmland that will give our stockholders exposure to a well-diversified portfolio of high-quality U.S. farmland, while offering an attractive risk-adjusted combination of stable rental income generation and value appreciation. Our principal investment focus is on farmland located in agricultural markets throughout North America; however, we may seek to acquire farmland outside of North America in the future. We also may acquire real estate assets related to farming, such as grain storage facilities, grain elevators, feedlots, cold storage facilities, controlled environment agriculture facilities, land and facilities leased to agriculture equipment dealerships, processing plants and distribution centers, as well as livestock farms or ranches. In addition, under the FPI Loan Program, we may provide loans to farm operators secured by farmland, properties related to farming, crops (growing or stored), and/or agricultural equipment. We may also invest in other agriculture-related business, typically through our TRS.

7

Crop Categories

Primary vs Specialty Crops

Farm crops generally can be divided into two principal categories: primary crops and specialty crops. Primary crops include, among others, corn, soybeans, wheat, rice and cotton. Primary crops are generally grown in rows and are often referred to as row crops. Specialty crops can be divided into two categories: annual specialty crops (generally vegetables) and permanent specialty crops (fruits and nuts grown on trees, bushes or vines). Over the long term, we expect that our farmland portfolio will continue to be comprised of approximately 70% primary crop farmland and 30% specialty crop farmland by value, which we believe will give investors the economic benefit from increasing global food demand in the face of growing scarcity of high quality farmland and will reflect the approximate allocation of U.S. agricultural output between primary crops and animal protein (whose production relies principally on primary crops as feed), on one hand, and specialty crops, on the other.

Primary Crops

The most widely grown crop in the United States is corn, at approximately 93 million acres. The uses of corn projected for the 2023/2024 marketing year (September 2023 to August 2024) are as follows: animal feed and residual products (34%); ethanol and its animal feed byproducts known as distillers’ dried grains with solubles or DDGS (32%); exports (13%); other sugars, starches, cereals, seeds (8%); and ending stocks or inventory (13%).

The second most widely grown crop in the United States is soybeans, at approximately 83 million acres. The uses of soybeans projected for the 2023/2024 marketing year (September 2023 to August 2024) are as follows: crushings (52%); exports (39%); seed and residual (3%); and ending stocks or inventory (6%). The process of crushing soybean produces soybean oil, soybean meal, hulls and waste. Soybean meal is used as animal feed both domestically and in the export market. Soybean oil is used for food, biofuel, and is exported.

The third most widely grown crop in the United States is wheat, at approximately 51 million acres. The uses of wheat projected for the 2023/2024 marketing year (June 2023 to May 2024) are as follows: food (38%); exports (29%); seed, feed and residual (7%); and ending stocks or inventory (26%).

Annual vs. Permanent Crops

Our portfolio includes farms that produce both annual and permanent crops. Annual crops, such as wheat, corn and soybeans, are planted every year whereas permanent crops, such as trees, bushes and vines, are planted and bear crops over multiple years without replanting. We believe exposure to both annual and permanent crops is an attractive strategy and offers diversification benefits to our portfolio. Annual and permanent crops typically serve different end-markets and generally have uncorrelated pricing.

U.S. Farmland Property

We believe that the United States offers farmland investors exposure to financial benefits driven by the fundamentals of agricultural production and farmland appreciation without many of the risks that come with farmland investments in many other countries. In the United States, the farmland market is relatively liquid and there is virtually no land title risk. As an asset class, United States farmland has lower leverage compared to other real estate sectors. According to the United States Department of Agriculture (“USDA”) forecast data from February 2024, real estate debt on farms is $377 billion, compared to a real estate value of $3.6 trillion, representing a 10% debt-to-equity ratio. The United States has the largest, lowest-cost grain transportation infrastructure in the world, leaving more margin to the grain producer and landowner. Moreover, the United States is one of the largest domestic markets for primary crops, which are typically priced in U.S. dollars. Lastly, we believe that in most major U.S. agricultural markets, multiple quality farm-operator tenants compete for farmland lease opportunities.

We may consider investing in farmland in other countries, such as Canada, Australia or New Zealand, that, like the United States, offer virtually no land title risk, a sophisticated farm-operator tenant environment and attractive rental rates.

8

Leased Properties

The business of farming carries materially more operating risk than owning and leasing farmland to farm operators, although such risk can be mitigated through crop insurance and other risk management tools. We expect to continue to lease a majority of our properties on a fixed-rent basis that does not depend on the success of the tenant's farming operations. Moreover, a majority of the leases in our portfolio provide that at least 50% (and sometimes 100%) of the annual fixed rent is due and payable in advance of each spring planting season, and we expect that a majority of the fixed-rent leases we enter into in the future will have a similar requirement, which reduces our credit-risk exposure in the event of operational issues with the farm-operator tenant. However, to the extent we enter into leases that do not require advance payment of 100% of the annual rent or have terms greater than one year, we may be subject to tenant credit risk and more susceptible to the risks associated with declines in the profitability of tenants’ farming operations, and we take such risk into consideration when evaluating the potential return on a farm. We may use variable-rent leases, which depend in part on crop yields and prices, in regions where such arrangements are prevalent or when we expect that such arrangements will be more profitable to us on a risk-adjusted basis. We also may utilize hybrid lease arrangements that provide for a combination of fixed rent and variable rent.

We expect to continue to lease the majority of our primary crop farmland under leases that require the tenant to either pay or reimburse us for substantially all of the property’s operating expenses, including maintenance, water usage and insurance. Consistent with industry practices, we expect that we will generally be responsible for plantings and associated improvements on our permanent crop farmland while our tenants will be responsible for all operating costs. Many of our leases provide for the reimbursement by the tenant of the property’s real estate taxes that we pay in connection with the farms they rent from us. The rental payments we receive from the farm operators are the primary source of any distributions that we make to our stockholders.

We expect that over time rental income will increase. Most farmland in the areas where we own or intend to acquire land is leased under short-term leases (typically five years or less), and we plan to lease our primary crop properties under short-term leases when possible. By entering into short-term leases, we believe we will be in a position to increase our rental rates when the leases expire. However, we can provide no assurances that we will be able to increase our rental rates, or even maintain them at the same level, when the leases are renewed or the land is re-leased.

We believe quality farmland has a near-zero vacancy rate, and we believe that all high-quality farmland in an area with a competitive tenant environment is generally leased and farmed each year. In the event of a tenant's failure to pay rent due in advance of the spring planting season, we will seek to terminate the lease and rent the property to another tenant that could then plant and harvest a crop that year. As a result, we believe there is a reduced risk of vacancy on our properties when compared to most other types of commercial properties, such as office buildings or retail properties.

Tenants

We believe the areas where we own and intend to acquire farmland are characterized by a competitive farm-operator tenant environment, with multiple experienced farm operators seeking to expand their operations by leasing additional farmland. Farmers have long rented land to increase operations without having to invest the capital required to own the land. USDA data shows that rented land as a percentage of total farmland acres has been in the 35% to 45% range since the 1920s.

Non-Farming Leases

In addition to leases entered into in connection with farming operations, we seek additional sources of income from our properties that are either incremental, such as wind easements and recreational leases, or are higher than farming rents, such as leases for solar power installations. While we do not believe that such non-farming lease income will constitute a significant percentage of our total revenues, they offer opportunities to enhance returns to stockholders at little or no cost to us.

9

Family-Owned Properties

According to America’s Farms and Ranches at a Glance 2023 Edition, a USDA report, family farms accounted for approximately 97% of the total farms in the United States. As shown below, small family farms represent the greatest number of farms and amount of land, while large-scale family farms represent the greatest value of production.

Farm Category

    

Annual Gross Farm Cash Income

    

Number of Farms

    

Percent of Farms

    

Percent of Land Area

    

Value of Production

Small Family Farms

Less than $350,000

1,756,441

88.1

%

46.5

%

18.7

%

Midsize Family Farms

Less than $1,000,000

115,595

5.8

%

21.4

%

19.1

%

Large-Scale Family Farms

Greater than $1,000,000

67,936

3.4

%

24.8

%

51.8

%

Nonfamily Farms

54,450

2.7

%

7.3

%

10.4

%

Total

1,994,422

100.0

%

100.0

%

100.0

%

Farmland leases allow farm operators to unlock personal or family capital/net worth that would otherwise be tied up in land ownership while retaining the ability to conduct their livelihoods on land that is familiar to them. We believe that many farm families and individuals may wish to engage in sale-leaseback transactions to grow their farming operations or in other business endeavors, or for estate planning reasons, providing a continuous pipeline of prospective acquisitions.

As an alternative to selling their farmland to us in an all-cash transaction, we believe that some farm owners may be interested in selling their farmland to us in exchange for Operating Partnership units in order to own a diversified portfolio of agricultural real estate in transactions that may qualify as tax-deferred contributions to a partnership under U.S. federal income tax laws. In addition, because we intend to make cash distributions quarterly or annually, Partnership unit holders would receive regular cash distributions, and their investment would be diversified across a much larger number of properties than the single property in which they were invested before such contribution. Finally, Partnership unit holders would have the flexibility to tender their Partnership units in the future for redemption by us for cash, or, at our election, shares of our common stock that they could then sell in the public market, thereby allowing these sellers to determine the timing of recognizing taxable gain. Because we expect the issuance of Partnership units in exchange for farmland generally will be driven by the desires of prospective sellers, we do not know how frequently we will issue Partnership units in exchange for farmland properties. However, we believe that using Partnership units as acquisition consideration can be a significant part of our property acquisition strategy.

Other Investments

In addition to farmland, we also may acquire real estate assets related to farming, such as grain storage facilities, grain elevators, feedlots, cold storage facilities, controlled environment agriculture facilities, land and facilities leased to agriculture equipment dealerships, processing plants and distribution centers, as well as livestock farms or ranches.

Underwriting Criteria and Due Diligence Process

Identifying and Selecting Attractive Properties

We seek to acquire high-quality farmland that offers an attractive risk-adjusted balance of current income and value appreciation potential. We believe our management team’s deep understanding of agribusiness fundamentals and insight into factors affecting the value of farmland allow us to identify properties consistent with our investment criteria. We believe the following factors are important in the selection of farmland:

Holders
Soil Quality—Soil quality is a fundamental determinant of farmland productivity and therefore of its value. In general, we focus on farmland with average or better-than-average soil. 

Water Availability—Appropriate water availability is an essential input to farming and a key consideration in determining the productivity and value of farmland. We seek to acquire farmland where water availability through precipitation and irrigation meets the agronomic needs of the crops expected to be grown. As part of our Series A preferred units are entitledacquisition due diligence process, we evaluate properties for water availability and any associated ground or surface water rights. Where appropriate, we may also invest in irrigation infrastructure to receive cash distributionsimprove the productivity

10

of properties we own. Occasionally we may acquire farmland at prices that more than compensate us for any potential reduction in water availability, which, in the future, may result in a rateshift to different crops or production systems.

Robust and Competitive Tenant Environment—We focus primarily on farmland located in areas characterized by a robust and competitive tenant environment, with a relatively large population of 3.00% per annum onexperienced farm operators as potential tenants. 

Market Access—Due to the $1,000 liquidation preferencehigher costs of road transportation, the location of primary crop farmland relative to points of demand (e.g., grain elevators, feedlots and ethanol plants) or access to low-cost transportation (e.g., river ports and rail loading facilities) determines the premium or discount in farm-gate commodity prices compared to the general market prices (also known as “basis”), and therefore is one of the Series A preferred units, which is payable annuallyfactors that impacts its value. We focus on acquiring primary crop farmland in arrears on January areas with substantial farming infrastructure and low transportation costs, including markets with access to river and rail transportation.

Climate—Crops have particular climatic growing requirements. Accordingly, we seek to acquire properties in regions with climates conducive to the expected crops. We believe that diversification within and across core farming regions and crop types provides significant annual and long-term risk mitigation to our investors.  Nevertheless, our farmland may experience periodic droughts and other significant weather events, such as tornadoes, hurricanes and floods.

We perform a due diligence review with respect to each potential property acquisition. The due diligence investigation includes both property-specific factors (e.g., soil types and fertility, water availability and rights, topographical characteristics and property taxes) and location-specific factors (e.g., climate, tenant availability and quality, and market access). As part of our due diligence process, we also perform a valuation of each target property and estimate expected lease rates.

Identifying and Selecting Tenants

We intend to continue to focus primarily on farm properties located in areas with a robust and competitive environment of experienced tenants. In general, the tenant selection process focuses primarily on candidates' experience and reputation based upon background and reference checks, as well as their willingness and ability to pay competitive rental rates. In geographic areas where we already own one or more properties, we may give our existing local tenants priority consideration, especially when a tenant sources the property acquisition opportunity. We believe our use of leases pursuant to which at least 50% of the annual rent is typically payable in advance of each spring planting season mitigates the tenant credit risk associated with the variability of farming operations that could be adversely impacted by poor crop yields, weather conditions, mismanagement, undercapitalization or other factors affecting our tenants. Tenant credit risk is further mitigated by the farming industry practice of purchasing crop insurance in almost every circumstance because it is required by lenders who provide working capital financing to our tenants and due to requirements in our leases. In certain cases, the Company perfects its security interest in the crop insurance proceeds and the underlying growing crops using practices applicable in the state where the farm is located. In addition, we monitor our existing tenants by periodically conducting site visits of the farms and meeting with the tenants to discuss their farming operations and the condition of the farms. However, in some circumstances, we may be exposed to tenant credit risk and may be subject to farming operation risks, such as adverse weather conditions and declines in commodity prices, particularly with respect to leases that do not require advance payment of 100% of the annual rent, variable-rent leases for which the rent is based on a percentage of a tenant's farming revenues and leases with terms greater than one year. See “Risk Factors—Risks Related to Our Business and Properties.” We do not intend to continuously monitor and evaluate tenant credit quality and may be subject to risks associated with our tenants' financial condition and liquidity position.

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Complementary Businesses

FPI Loan Program

We believe that our existing systems and personnel are well suited to source, conduct due diligence evaluations with respect to, close and service loans under the FPI Loan Program at little or no additional operating cost to us. We believe that the business of making loans to farm operators secured by farmland, properties related to farmland, crops (growing or stored), and/or agricultural equipment leverages the substantial expertise in agribusiness possessed by the FPI team and is highly complementary to our core business of investing in farmland. We generally find potential borrowers during the process of sourcing farm acquisitions. We conduct due diligence on loan collateral largely the same way we conduct due diligence on potential farm acquisitions, and we screen potential borrowers using criteria similar to those used to screen potential tenants. The FPI Loan Program offering gives us an increased visibility in the marketplace, thereby benefiting our core farmland investing business.

Asset Management for Third Parties

We believe that our existing systems and personnel are well suited to source, conduct due diligence evaluations with respect to, close and manage farmland on behalf of third parties at little or no additional cost to us, generating fee income without capital investment. As of December 31, 2023, we managed approximately 38,300 acres on behalf of third parties.

Brokerage and Auction Services

The acquisition of Murray Wise Associates, LLC (“MWA”) in November 2021 also added brokerage and auction business activities for clients seeking to sell farmland. This increases our breadth of activities in the farmland sector, while adding additional sources of revenue and market insight.

Seasonality

We recognize rental revenue from fixed-rate leases on a pro rata basis over the non-cancellable term of the lease in accordance with accounting principles generally accepted in the United States (“GAAP”). Notwithstanding GAAP accounting requirements to spread rental revenue over the lease term, a significant portion of fixed rent is received in a lump sum before planting season, generally in the first quarter, and after harvest, in the fourth quarter or in the following year. We receive a significant portion of our variable rental payments following harvest in the fourth quarter of each year, with only a portion of such payments being recognized ratably through the year in accordance with GAAP, in relation to crop insurance contracts entered into by our tenants. The highly seasonal nature of the agriculture industry causes seasonality in our business to some extent, with revenue in the first and fourth quarter tending to be meaningfully higher than revenue in the second and third quarters. Our financial performance should be evaluated on an annual basis, which eliminates impacts of seasonality and other similar factors that may cause our quarterly results to vary during the course of the year.

Our Properties

As of December 31, 2023, we owned farms with an aggregate of approximately 132,800 acres in Arkansas, California, Colorado, Florida, Illinois, Indiana, Kansas, Louisiana, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, South Carolina and Texas. In addition, as of December 31, 2023, we owned land and buildings for four agriculture equipment dealerships in Ohio leased to Ag Pro under the John Deere brand and served as property manager for approximately 38,300 acres, including farms in Iowa (see “Note 4—Related Party Transactions”). During the year ended December 31, 2023, the Company completed dispositions, consisting of 74 properties, in the Corn Belt, Delta and South, High Plains, Southeast and West Coast regions. We received $195.5 million in aggregate consideration, including $11.8 million in seller financing, and recognized an aggregate gain on sale of $36.1 million. Also, during the year ended December 31, 2023, the Company completed acquisitions consisting of four properties in the Corn Belt and Delta and South regions. Aggregate cash consideration for these acquisitions totaled $22.2 million. See “Management’s Discussion and Analysis of Financial

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Condition and Results of Operations” for more information about our portfolio. The distribution of farms owned by regions is as follows:

Region (1)

    

Owned Acres

    

Managed Acres

    

Total Acres

Corn Belt (2)

44,527

22,027

66,554

Delta and South

26,427

8,763

35,190

High Plains

21,831

1,380

23,211

Southeast

28,825

6,107

34,932

West Coast

11,189

11,189

132,799

38,277

171,076

(1)Corn Belt includes farms located in Illinois, Indiana, Iowa, Missouri and eastern Nebraska. Delta and South includes farms located in Arkansas, Louisiana, Mississippi and Oklahoma. High Plains includes farms located in Colorado, Kansas and Texas. Southeast includes farms located in Florida, North Carolina and South Carolina. West Coast includes farms located in California.
(2)In addition, we own land and buildings for four agriculture equipment dealerships in Ohio leased to Ag Pro under the John Deere brand.

Tax Status

We elected and qualified to be taxed as a REIT for U.S. federal income tax purposes commencing with our short taxable year ended December 31, 2014. Our qualification as a REIT will depend upon our ability to meet, on a continuing basis, through actual investment and operating results, various complex requirements under the Code, relating to, among other things, the sources of our gross income, the composition and values of our assets, our distribution levels and the diversity of ownership of our capital stock. We believe that we are organized in conformity with the requirements for qualification as a REIT under the Code and that our intended manner of operation will enable us to meet the requirements for qualification and taxation as a REIT for U.S. federal income tax purposes.

As a REIT, we generally are not subject to U.S. federal income tax on our taxable income that we distribute to our stockholders. Under the Code, REITs are subject to numerous organizational and operational requirements, including a requirement that they distribute on an annual basis at least 90% of their REIT taxable income, determined without regard to the deduction for dividends paid and excluding any net capital gains. If we fail to qualify for taxation as a REIT in any taxable year and do not qualify for certain statutory relief provisions, our income for that year will be subject to tax at regular corporate rates, and we would be disqualified from taxation as a REIT for the four taxable years following the year during which we ceased to qualify as a REIT. Even if we qualify as a REIT for U.S. federal income tax purposes, we may still be subject to state and local taxes on our income and assets and to U.S. federal income and excise taxes on our undistributed income. Additionally, any income earned by FPI Agribusiness Inc., our taxable REIT subsidiary, and any other taxable REIT subsidiaries that we form or acquire in the future will be fully subject to U.S. federal, state and local corporate income tax.

Insurance

The Company maintains comprehensive property and casualty and general liability insurance through its relationship with a national insurance brokerage firm with extensive agricultural experience. The Company’s workers’ compensation is provided through a professional employee organization, and the Company maintains liability insurance covering its directors and officers. Certain other insurance programs are maintained as required by contract or deemed necessary by our management team, including crop insurance for farms operated by the Company. Under the terms and conditions of the leases on our current properties, tenants are generally required, at their expense, to obtain and keep in full force during the term of the lease liability insurance and to name us an additional insured party. To the extent required, tenants also maintain workers’ compensation policies for their businesses. These policies include liability coverage for bodily injury and property damage arising out of the ownership, use, occupancy or maintenance of the properties and all of their appurtenant areas. The terms of leases that include variable rent payments generally require the tenant to carry crop insurance protecting against crop failures and/or crop price declines.

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Regulation

Farming Regulations

The farmland that we own and intend to acquire in the future is typically used for growing crops and is subject to the laws, ordinances and regulations of state, local and federal governments, including laws, ordinances and regulations involving land use and usage, water rights, treatment methods, disturbance, the environment and eminent domain.

Farmland is principally subject to environmental and agricultural laws, ordinances and regulations. Each governmental jurisdiction has its own distinct laws, ordinances and regulations governing the use of farmland. Many such laws, ordinances and regulations seek to regulate water usage and water runoff because water can be in limited supply, as is the case where certain of the properties in our portfolio are located.

All of the farms in our portfolio have sources of water, including expected precipitation, existing and planned wells and/or surface water, that currently provide sufficient amounts of water necessary for the current farming operations at each location. However, should the need arise for additional water from wells and/or surface water sources, such permits and approvals may be difficult to obtain in areas with limited supply of available water. We believe that as of the date of this Annual Report on Form 10-K our farms are in compliance with applicable state, county and federal environmental and agricultural regulations.

In addition to the regulation of water usage and water runoff, state, local and federal governments also seek to regulate the type, quantity and method of use of chemicals and materials for growing crops, including fertilizers, pesticides and nutrient rich materials. Such regulations could include restricting or preventing the use of such chemicals and materials near residential housing or near water sources. Further, some regulations have strictly forbidden or significantly limited the use of certain chemicals and materials.

As an owner of farmland, we may be liable or responsible for the actions or inactions of our tenants with respect to these laws, regulations and ordinances.

Real Estate Industry Regulation

Generally, the ownership and operation of real properties is subject to various laws, ordinances and regulations, including regulations relating to zoning, land use, water rights, wastewater, storm water runoff and lien sale rights and procedures. These laws, ordinances or regulations, such as the Comprehensive Environmental Response and Compensation Liability Act (“CERCLA”) and its state analogs, or any changes to any such laws, ordinances or regulations, could result in or increase the potential liability for environmental conditions or circumstances existing, or created by tenants or others, on our properties. Laws related to upkeep, safety and taxation requirements may result in significant unanticipated expenditures, loss of our properties or other impairments to operations, any of which would adversely affect our cash flows from operating activities.

Environmental Matters

As an owner of real estate, we will be subject to various federal, state and local environmental laws, regulations and ordinances and also could be liable to third parties resulting from environmental contamination or noncompliance at our properties. Environmental laws often impose liability without regard to whether the owner or operator knew of or was responsible for the presence of the contaminants. The costs of any required investigation or cleanup of these substances could be substantial. The liability is generally not limited under such laws and could exceed the property’s value and the aggregate assets of the liable party. The presence of contamination or the failure to remediate contamination at our properties also may expose us to third-party liability for personal injury or property damage or adversely affect our ability to lease the real property or to borrow using the real estate as collateral. These and other risks related to environmental matters are described in more detail in “Item 1A. Risk Factors.”

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Sustainability

We believe a strong commitment to multi-faceted sustainability supports our business model and promotes environmental stewardship. Our sustainability policy is founded on the principle of helping feed the world, especially people in poverty, with the least negative environmental impact possible. Sustainability is considered a high priority topic at all levels of our organization, with a commitment formulated by the Board of Directors and senior management team.

Social Impact, Human Rights, and Company Culture

Utilizing land for farming creates a more sustainable future for all by affordably feeding the world’s growing population and supplying food products that support better nutrition. Moreover, we act as a channel to bring capital, and therefore economic activity, to rural communities throughout the United States, supporting farming as a livelihood as it has been for thousands of years. We support the United Nations’ Universal Declaration of Human Rights and are committed to ensuring that human rights are respected throughout our extended community of employees, tenants and suppliers. We require our tenants to comply with all applicable labor and environmental regulations. We foster a company culture based on open communication and professional growth, and support employees engaged with non-profit organizations.

Environmental Sustainability

Farmland is more environmentally friendly than most types of commercial real estate, as agriculture naturally uses solar energy to capture carbon dioxide from the atmosphere and convert it into food, feed, fuel, and fiber. Principles of environmental sustainability are deeply interwoven into modern agricultural practices and are embedded into our farmland acquisition criteria and management practices. We foster long-term relationships with our tenants, who are incentivized to provide good stewardship for the land they rent from us. The use of farmland as a carbon sink to generate carbon credits is a double-impact (environmental and financial) opportunity that we believe will continue to increase in significance in coming years.

Renewable energy generation (wind and solar) is a component of our business model of growing importance. As of December 31, 2023, we leased acres to support 3 solar energy operational projects across 11 farms and 2 wind energy projects across 4 farms, which have the capacity to generate approximately 214 and 30 megawatts of renewable energy, respectively. We own 16 additional farms which have options for future solar projects. We expect to continue to take advantage of opportunities to place solar panels and windmills on farmland owned by FPI.

We place significant emphasis on the support of biodiversity and wildlife. Our portfolio supports biodiversity through the enrollment of acres, in partnership with our tenants, in the U.S. Department of Agriculture’s Conservation Reserve Program (CRP). In exchange for a yearly rental payment, CRP participants agree to remove less-productive land from agricultural production and re-establish native vegetation to improve water quality, prevent erosion, and protect wildlife habitat. We also agreed in 2021 to sell Ducks Unlimited (“DU”) approximately 1,268 acres of farmland in a three-part conservation transaction to support habitat restoration and protection in Virginia. The multi-year, staged sale concluded in November 2023 and was designed to provide DU maximum flexibility to secure capital for the project. Many more of our farms provide habitat for waterfowl and other wildlife.

Competition

Competition to acquire farmland can come from many different sources. Individual farmers are the most active buyers of farmland. Institutional investors, investment funds, other farmland REITs, individual investors and others also compete for farmland acreage. Investment firms that we might compete directly against for investment capital to be deployed in farmland could include agricultural investment firms such as Westchester Agriculture Asset Management (a TIAA company), Manulife Investment Management, International Farming Corporation, Ceres Partners, Gladstone Land Corporation, UBS Agrivest, AgIS Capital, Homestead Capital, and Goldcrest Farm Trust Advisors. These firms engage in the acquisition, asset management, valuation and disposition of farmland properties.

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Human Capital Resources

Our employees are vital to our success. Our goal is to ensure that we have the right talent, in the right place, at the right time. We do that through our commitment to attracting, developing and retaining our employees.

We have designed a compensation structure, including an array of benefit and long-term incentive plans, that we believe is attractive to our current and prospective employees. We also offer employees the opportunity to participate in conferences and continuing education.

We seek to retain our employees by using their feedback to create and continually enhance programs that support their needs. We have a formal performance review process for our employees. We have a values-based culture, an important factor in retaining our employees. We are committed to having a diverse workforce, and an inclusive work environment is a natural extension of our culture.

At December 31, 2023, we had 26 employees, 25 of which are full time. None of our employees are a member of a labor union.

Corporate Information

Our executive offices are located at 4600 South Syracuse Street, Suite 1450, Denver, Colorado 80237. Our telephone number at our executive offices is (720) 452-3100 and our corporate website is www.farmlandpartners.com. The information on, or accessible through, our website is not incorporated into and does not constitute a part of this Annual Report on Form 10-K or any other report or document we file with or furnish to the SEC.

Available Information

We file our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K, and all amendments to those reports with the SEC. You may obtain copies of these documents by accessing the SEC’s website at www.sec.gov. In addition, as soon as reasonably practicable after such materials are furnished to the SEC, we make copies of these documents available to the public free of charge through our website or by contacting our Secretary at the address set forth above under “—Corporate Information.”

Our Corporate Governance Guidelines, Code of Business Conduct and Ethics, and the charters of our audit committee, compensation committee, and nominating and corporate governance committee are all available in the Governance Documents section of the Corporate Information section of our website. The information accessible on our website is not incorporated in, nor should be considered a part of, this Annual Report on Form 10-K.

Financial Information

For required financial information related to our operations, please refer to our consolidated financial statements, including the notes thereto, included within this Annual Report on Form 10-K.

Item 1A. Risk Factors

Set forth below are the risks that we believe are material to our stockholders. You should carefully consider the following risks in evaluating our Company and our business. The occurrence of any of the following factors, events or circumstances described below could materially adversely impact our financial condition, results of operations, cash flow, the market price of shares of our common stock and preferred stock and our ability to, among other things, satisfy our debt service obligations and to make distributions to our stockholders, which in turn could cause our stockholders to lose all or a part of their investment. Some statements in this report including statements in the following risk factors constitute forward-looking statements. Please refer to the section entitled “Special Note Regarding Forward-Looking Statements” at the beginning of this Annual Report on Form 10-K.

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Risks Related to Our Business and Properties

Our business is dependent in part upon the profitability of our tenants' farming operations, and a sustained downturn in the profitability of their farming operations could have a material adverse effect on the amount of rent we can collect and, consequently, our cash flow and ability to make distributions to our stockholders.

We depend on our tenants to operate the farms we own in a manner that generates revenues sufficient to allow them to meet their obligations to us, including their obligations to pay rent and real estate taxes, maintain certain insurance coverage and maintain the properties generally. The ability of our tenants to fulfill their obligations under our leases depends, in part, upon the overall profitability of their farming operations, which could be adversely impacted by, among other things, adverse weather conditions, crop prices, crop disease, pests, and unfavorable or uncertain political, economic, business, trade or regulatory conditions. We are susceptible to any decline in the profitability of our tenants' farming operations, to the extent that it would impact their ability to pay rents. In addition, many farms are dependent on a limited number of key individuals whose injury or death may affect the successful operation of the farm. We can provide no assurances that, if a tenant defaults on its obligations to us under a lease, we will be able to lease or re-lease that farm on economically favorable terms in a timely manner, or at all. In addition, we may experience delays in enforcing our rights as landlord and may incur substantial costs in protecting our investment.

As a result, any downturn in the profitability of the farming operations of our tenants or a downturn in the farming industry as a whole could have a material adverse effect on our financial condition, results of operations, cash flow and ability to make distributions to our stockholders.

We have a substantial amount of indebtedness outstanding, which may expose us to the risk of default under our debt obligations, restrict our operations and our ability to grow our business and revenues and restrict our ability to pay distributions to our stockholders.

As of December 31, 2023, we had approximately $363.1 million of outstanding indebtedness excluding debt issuance costs, most of which is secured by mortgages on our farms. We intend to incur additional debt in connection with refinancing of existing indebtedness, future acquisitions or for other purposes and, if necessary, we may borrow funds to make distributions to our stockholders in order to qualify and maintain our qualification as a REIT for U.S. federal income tax purposes. In addition, we have sold farms in order to repay indebtedness in the past and may do so in the future. Such dispositions may come at inopportune times or on disadvantageous terms, which could result in losses.

In addition, our debt agreements include customary events of default, the occurrence of any of which, after any applicable cure period, would permit the lenders to, among other things, accelerate payment of all amounts outstanding under the loans and to exercise their remedies with respect to the collateral, including foreclosure and sale of the agricultural real estate securing the loans. Certain of our debt agreements also contain cross-default provisions that give the lender the right, in certain circumstances, to declare a default if we are in default under other loans. If any one of these events were to occur, our financial condition, results of operations, cash flow and ability to pay distributions to our stockholders could be materially and adversely affected.

Mortgage debt obligations expose us to the possibility of foreclosure, which could result in the loss of our investment in a property or group of properties subject to mortgage debt.

As of December 31, 2023, we had approximately $363.1 million of outstanding mortgage indebtedness excluding debt issuance costs. We intend to finance future property acquisitions, in part, with mortgage indebtedness. Mortgage and other secured debt obligations increase our risk of property losses because defaults on indebtedness secured by properties may result in foreclosure actions initiated by lenders and ultimately our loss of the property securing any loans for which we are in default. Any foreclosure on a mortgaged property or group of properties could adversely affect the overall value of our portfolio of properties. For tax purposes, a foreclosure on any of our properties that is subject to a nonrecourse mortgage loan would be treated as a sale of the property for a purchase price equal to the outstanding balance of the debt secured by the mortgage. If the outstanding balance of the debt secured by the mortgage exceeds our tax basis in the property, we would recognize taxable income on foreclosure, but would not receive any cash proceeds, which could hinder our ability to meet the REIT distribution requirements imposed by the Code.

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Our debt financing agreements restrict our ability to engage in certain business activities, including our ability to incur additional indebtedness, make capital expenditures and make certain investments.

Our existing debt financing agreements contain, and other debt financing agreements we may enter into in the future may contain customary negative covenants and other financial and operating covenants that, among other things:

restrict our ability to incur additional indebtedness;
restrict our ability to incur additional liens;
restrict our ability to make certain investments (including certain capital expenditures);
restrict our ability to merge with another company;
restrict our ability to sell or dispose of each year.  Holdersassets;
restrict our ability to make distributions to stockholders; and
require us to satisfy minimum financial coverage ratios, minimum tangible net worth requirements and maximum leverage ratios.

Increases in benchmark interest rates will increase our borrowing costs, which will negatively impact our financial condition, results of operations, growth prospects and ability to make distributions to stockholders.

Beginning in 2022, the Board of Governors of the United States Federal Reserve Bank (the “Federal Reserve”) has undertaken a significant tightening of monetary policy, which has increased borrowing costs (through the resulting increase in interest rates) and decreased credit availability. The Federal Reserve has maintained elevated benchmark interest rates during 2022 and 2023 to help curb inflation, and although the Federal Reserve may reduce benchmark interest rates in 2024, there are no assurances that interest rates will be reduced on the anticipated timeline, and interest rates remain high. Future periods of rising interest rates could increase our borrowing costs on our existing floating-rate indebtedness as well as on any future fixed or floating rate indebtedness used to refinance existing indebtedness or to acquire new properties. As of December 31, 2023, $136.0 million of our outstanding indebtedness was subject to interest rates that reset from time to time (excluding our floating rate debt), of which $43.9 million was subject to interest rates that will be reset in 2024. As of December 31, 2023, the weighted average interest rate of the indebtedness subject to interest rate resets in 2024 was 3.07%, which we expect to increase significantly if benchmark interest rate levels remain constant as we expect them to during the course of 2024 (for more information on rate resets see “Note 7—Mortgage Notes, Lines of Credit and Bonds Payable”). Increases in borrowing costs could reduce our income and cash flow and materially and adversely impact our results of operations, financial condition and our ability to make distributions to our stockholders.

Increases in interest rates will increase our tenants’ borrowing costs and make it more difficult for them to obtain credit and may cause land prices to decline.

Increasing interest rates result in higher borrowing costs for farmers and may make it more difficult for farm operators to obtain indebtedness to fund their operations, which could have an adverse impact on our tenants’ ability to make rental payments to us. Higher interest rates also tend to decrease U.S. and world economic growth, thus decreasing the demand for certain agricultural commodities.

All of these consequences could reduce farm income. If increases in interest rates are not accompanied by higher levels of farm income, this could lead to a reduction in our tenants’ profitability, which could have a material adverse effect on our business or results of operations, financial condition, and ability to make distributions to our stockholders.

We have issued Series A preferred units that may be converted to Common units on or after February 10, 2026, which Common units would be immediately redeemable, for cash or shares of common stock at the Company’s option. The conversion of such Series A preferred units and potential redemption of the converted Common units for shares of common stock could have an immediate dilutive effect on the ownership interests of our common stockholders.  

On or after February 10, 2026 (the “Conversion Right Date”), holders of the Series A preferred units have the right to convert each Series A preferred unit into a number of Common units equal to (i) the $1,000 liquidation preference plus all accrued and unpaid distributions, divided by (ii) the volume-weighted average price per share of the Company’s common

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stock for the 20 trading days immediately preceding the applicable conversion date. All Common units received upon conversion may be immediately tendered for redemption for cash or, at the Company’s option, for shares of common stock on a one-for-one basis, subject to the terms and conditions set forth in the Partnership Agreement. Prior to the Conversion Right Date, the Series A preferred units may not be tendered for redemption by the Holder. To the extent the Series A preferred units are converted to Common units and such Common units are redeemed for shares of common stock, our existing common stockholders would experience an immediate, and potentially significant, dilutive effect on their ownership interest in the Company, which could cause the market price of our common stock to be materially adversely affected.  

Global economic conditions, including inflation and supply chain disruptions, could adversely affect our and our tenants’ operations.

General global economic downturns and macroeconomic trends, including heightened inflation, volatility in the capital markets, interest rate and currency rate fluctuations, the war in Ukraine and the ongoing conflict in the Middle East, changes in trade policies among nations that import and/or export agricultural products and economic slowdown or recession, may result in unfavorable conditions that could negatively affect demand for our tenants’ crops and exacerbate some of the other risks that affect our business, financial condition and results of operations. In addition, during 2022 and 2023 the Federal Reserve repeatedly raised interest rates in response to concerns about inflation. Interest rate increases or other government actions taken to reduce inflation could also result in an economic recession.

Our tenants have experienced challenges in their supply chains and related price increases. Continued deterioration in the domestic or international economic environment may cause decreased demand for our tenants’ crops, which could result in lower sales volume and lower prices for their crops, as well as increase the cost of operating their businesses and a corresponding adverse effect on their ability to make rental payments to us, which would adversely impact our financial condition and results of operations.

Approximately 70% of our portfolio is comprised of properties used to grow primary crops such as corn, soybeans, wheat, rice and cotton, which subjects us to risks associated with primary row crops.

By value, approximately 70% of our portfolio is used for primary crops, such ascorn, soybeans, wheat, rice and cotton. As a result, any development or situation that adversely affects the value of properties generally, or the prices of corn, soybeans, wheat, rice or cotton, could have a more significant adverse impact on us than if our portfolio had less exposure to primary crops, which could materially and adversely impact our financial condition, results of operations and ability to make distributions to our stockholders.

Investments in farmland used for permanent/specialty crops have a different risk profile than farmland used for annual row crops.

By value, approximately 30% of our portfolio is used for permanent crops, and, in the future, we may add to our investments in farmland used for permanent crops, as opposed to annual row crops. Permanent crops have plant structures (such as trees, vines or bushes) that produce yearly crops without being replanted. Examples include blueberries, oranges, apples, almonds and grapes. Permanent crops require more time and capital to plant and bear fruit and are more expensive to replace. If a farmer loses a permanent/specialty crop to drought, flooding, fire or disease, there generally would be significant time and capital needed to return the land to production because a tree or vine may take years to grow before bearing fruit.

Permanent crop plantings also reduce a farmer’s ability to adapt to changing market conditions by changing crops. If demand for one type of permanent crop decreases, the permanent crop farmer cannot easily convert the farm to another type of crop because permanent crop farmland is dedicated to one crop during the lifespan of the trees or vines and therefore cannot easily be rotated to adapt to changing environmental or market conditions.

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Our failure to continue to identify and consummate suitable acquisitions would significantly impede our growth and our ability to further diversify our portfolio by geography, crop type and tenant, which could materially and adversely affect our results of operations and cash available for distribution to our stockholders.

Our ability to expand through farmland acquisitions is important to our business strategy and requires that we identify and consummate suitable acquisition or investment opportunities that meet our investment criteria and are compatible with our growth strategy. We compete for the acquisition of farmland and real estate assets related to farming with many other entities engaged in agricultural and real estate investment activities, including individual and family operators of farming businesses, corporate agriculture companies, financial institutions, institutional pension funds, public REITs, other real estate companies, private equity funds and other private real estate investors. These competitors may prevent us from acquiring desirable properties or may cause an increase in the price we must pay for such properties. Our competitors may adopt transaction structures similar to ours, which would decrease our competitive advantage in offering flexible transaction terms. In addition, the number of entities and the amount of funds competing for suitable investment properties may increase, resulting in increased demand and increased prices paid for these properties. If we pay higher prices for properties, our profitability may decrease, and you may experience a lower return on your investment. Our failure to identify and consummate suitable acquisitions would significantly impede our growth, which would adversely affect our results of operations and cash available for distribution to our stockholders.

Failure to succeed in new markets may have adverse consequences.

We intend to continue to acquire properties across the U.S. and may from time to time evaluate potential international acquisitions. When we acquire properties located in new geographic areas in the U.S. or internationally, or properties primarily devoted to a crop or industry with which we are less familiar (such as certain specialty crops, energy production, dairy farms or hog farms), we may face risks associated with a lack of market knowledge or understanding of the local market, including the availability and identity of quality tenants, forging new business relationships in the area, developing an understanding of a crop or industry unfamiliar to us, and unfamiliarity with local or crop-specific government requirements and procedures. Furthermore, the negotiation of a potential expansion into new markets or industries may divert management time and other resources. As a result, we may have difficulties executing our business strategy in these new markets, which could have a negative impact on our results of operations and ability to make distributions to our stockholders.

We do not continuously monitor and evaluate tenant credit quality, and our financial performance may be subject to risks associated with our tenants' financial condition and liquidity position.

Certain of our leases do not require the full payment of rent in cash in advance of the planting season, which subjects us to credit risk exposure to our farm-operator tenants and the risks associated with farming operations, such as weather, commodity price fluctuations and other factors. We also are exposed to these risks with respect to leases for which the rent is based on a percentage of a tenant's farming revenues and leases with terms greater than one year.Because we do not monitor and evaluate the credit risk exposure related to farm-operator tenants on an ongoing basis, we are subject to the risk that our tenants, particularly those that may depend on leverage to finance their operations, could be susceptible to bankruptcy in the event that their cash flows are insufficient to satisfy their financial obligations, including meeting their obligations to us under their leases. As a result, we may not become aware of a tenant's financial distress until the tenant fails to make payments to us when due, which may significantly reduce the amount of time we have to evict the tenant and re-lease the farmland to a new tenant before the start of the spring planting season, and in the event of a tenant bankruptcy we may not be able to terminate the lease. If we are unable to re-lease the farmland on a timely basis, it could have a material adverse effect on our revenues.

Our short-term leases make us more susceptible to any decreases in prevailing market rental rates than would be the case if we entered into longer-term leases, which could have a material adverse effect on our results of operations and ability to make distributions to our stockholders.

Our leases with tenants engaged in farming operations have terms customary in the farming industry, ranging from one to three years, with some extending up to 40 years (e.g., renewable energy leases). We expect that most of the leases we enter into in the future will have two to seven-year terms. As a result, we are required to frequently re-lease our

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properties upon the expiration of our leases, which will make us more susceptible to declines in market rental rates than we would be if we were to enter into longer term leases. As a result, any decreases in the prevailing market rental rates in the geographic areas in which we own properties could have a material adverse effect on our results of operations and ability to make distributions to our stockholders.

We may be unable to collect balances due on our leases from any tenants in financial distress or bankruptcy, which could materially and adversely affect our financial condition, results of operations and cash flow.

We are subject to tenant credit risk. Our tenants, particularly those that may depend on leverage, could be susceptible to defaults under their leases or bankruptcy in the event that their cash flows are insufficient to satisfy their financial obligations. Certain of our tenants have defaulted on their lease payments, and we have been forced to pursue alternative arrangements with those tenants in order to recover amounts due under the leases. In the future, we may be forced to enter into similar alternative arrangements or pursue litigation in order to collect payments from tenants who are unable make their lease payments as they come due. We can provide no assurances that we will be able to collect the full amount due under a particular lease if we are forced to pursue alternative payment arrangements or litigation with any of our tenants.

If a bankrupt tenant rejects a lease with us, any claim we might have for breach of the lease, excluding a claim against collateral securing the lease, would be treated as a general unsecured claim. In the event of a tenant's default under its lease or its rejection of the lease in bankruptcy proceedings, we may be unable to locate a replacement tenant in a timely manner or on comparable or better terms. As a result, our financial condition, results of operations and ability to make distributions to our stockholders could be adversely affected.

We depend on external sources of capital that are outside of our control and may not be available to us on commercially reasonable terms or at all, which could limit our ability to, among other things, acquire additional properties, meet our capital and operating needs or make the cash distributions to our stockholders necessary to maintain our qualification as a REIT.

In order to maintain our qualification as a REIT, we are required under the Code to, among other things, distribute annually at least 90% of our REIT taxable income, determined without regard to the dividends paid deduction and excluding any net capital gain. In addition, we will be subject to income tax at regular corporate rates to the extent that we distribute less than 100% of our REIT taxable income, including any net capital gains. Because of these distribution requirements, we may not be able to fund future capital needs, including acquisition opportunities and principal and interest payments on any outstanding debt, from operating cash flow. Consequently, we rely on third-party sources to fund our capital needs. We may not be able to obtain such financing on favorable terms, in the time period we desire, or at all. Any debt we incur will increase our leverage, expose us to the risk of default and may impose operating restrictions on us, and any additional equity we raise (including the issuance of common or preferred units) could be dilutive to existing stockholders. Our access to third-party sources of capital depends, in part, on:

general market conditions, including conditions that are out of our Series B Participating Preferred Stock are entitledcontrol, such as actions or proposed actions of the current U.S. Presidential administration and the Federal Reserve to receivecurb inflation or the impact of future public health crises;
novel and unforeseen market volatility and trading strategies, such as short squeeze-rallies caused by retail investors on retail trading platforms;
the market’s view of the quality of our assets;
the market’s perception of our growth potential;
our debt levels;
our current and expected future earnings;
our cash dividends at a rate of 6.00% per annum on flow and cash distributions; and
the initial liquidation preferencemarket price per share of $25.00 (equivalentour common stock.

If we cannot obtain capital from third-party sources, we may not be able to acquire properties when strategic opportunities exist, meet the capital and operating needs of our existing properties, satisfy our debt service obligations or make the cash distributions to our stockholders necessary to qualify and maintain our qualification as a REIT.

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Illiquidity of real estate investments could significantly impede our ability to respond to adverse changes in the performance of our properties and harm our financial condition.

The real estate investments made, and to be made, by us may be difficult to sell quickly. As a result, our ability to promptly sell one or more properties in our portfolio in response to liquidity needs, changing economic, financial and investment conditions may be limited or we may have to sell properties at a loss. In addition, we seek to opportunistically dispose of properties when we are able to do so at a price we consider attractive and/or recognize a gain on sale. Return of capital and realization of gains, if any, from an investment generally will occur upon disposition or refinancing of the underlying property. We have used dispositions of assets in the past in order to meet our liquidity requirements. If we are required to dispose of additional assets for liquidity purposes, we may be unable to realize our investment objectives by sale, other disposition or refinancing at attractive prices within any given period of time or may otherwise be unable to complete any exit strategy. Opportunities to dispose of assets at a gain may not be available to us, which would reduce our cash on hand for stock repurchases, distributions to stockholders, or for any other purpose. In particular, weakness in or even the lack of an established market for a property, changes in the financial condition or prospects of prospective purchasers, changes in national or international economic conditions and changes in laws, regulations or fiscal policies of jurisdictions in which the property is located, in each case may limit our ability to dispose of a property.

In addition, the Code imposes restrictions on a REIT’s ability to dispose of properties that are not applicable to other types of real estate companies. In particular, the tax laws applicable to REITs effectively require that we hold our properties for investment, rather than primarily for sale in the ordinary course of business, which may cause us to forego or defer sales of properties that otherwise would be in our best interests. Moreover, if we acquire properties from C corporations (i.e., corporations generally subject to full corporate-level tax) in certain non-taxable transactions, as we have done in the past, built-in gain recognized on the non-taxable disposition of such properties within 5 years of our acquisition will be subject to tax at the highest applicable U.S. federal corporate income tax rate. Therefore, we may not be able to vary our portfolio in response to economic or other conditions promptly or on favorable terms.

Some state laws prohibit or restrict the ownership of agricultural land by business entities, which could impede the growth of our portfolio and our ability to diversify geographically.

Certain states, including Iowa, North Dakota, South Dakota, Minnesota, Oklahoma, Wisconsin, Missouri and Kansas, in which a substantial amount of primary crop farmland is located, have laws that prohibit or restrict to varying degrees the ownership of agricultural land by corporations or business entities like us. As of December 31, 2023, we owned 320 acres of farmland in Kansas, 815 acres in Missouri and 2,114 acres in Oklahoma, and our ownership of those farms may be challenged under Kansas, Missouri or Oklahoma law, in which case we may be required to sell those farms at an unfavorable time and on unfavorable terms. Additional states may, in the future, pass similar or more restrictive laws, and we may not be legally permitted, or it may become overly burdensome or expensive, to acquire properties in these states, which could impede the growth of our portfolio and our ability to diversify geographically in states that might otherwise have attractive investment opportunities.

Our farms are subject to adverse weather conditions, seasonal variability, crop disease and other contaminants, natural disasters and other natural conditions, including the effects of climate change and water availability, which may adversely affect the amount of variable rent or income from direct operations and/or our tenants' ability to pay fixed or variable rent and thereby have a material adverse effect on our results of operations, financial condition, and our ability to make distributions to stockholders.

Crops are vulnerable to adverse weather conditions, including windstorms, tornados, floods, drought and temperature extremes, which are common but difficult to predict, and may occur with higher frequency or be even less predictable in the future due to the effects of climate change. Unfavorable growing conditions can reduce both crop yield and quality. Seasonal factors, including supply and consumer demand, may also have an effect on the value of crops grown by our tenants. In extreme cases, entire harvests may be lost in some geographic areas.

In addition, crops are vulnerable to disease and pests. Damages to tenants’ crops may vary in severity and effect, depending on the stage of production at the time of infection or infestation, the type of treatment applied and climatic conditions. The costs to control these infestations vary depending on the severity of the damage and the extent of the

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plantings affected. These infestations can increase the costs and decrease the revenues of our tenants. Tenants may also incur losses from product recalls, fines or litigation due to other contaminants that may cause food borne illness. It is difficult to predict the occurrence or severity of such product recalls, fines or litigation as well as their impact upon our tenants.

We are particularly susceptible to adverse weather conditions (such as windstorms, tornados, floods, drought, hail and temperature extremes), transportation conditions (including navigation of the Mississippi River), crop disease, pests and other adverse growing conditions in California, Illinois, North Carolina, Colorado and Arkansas, which generate a significant portion of our revenues.

While many of our leases are on a fixed-rent basis that does not change based on the success of the farming operations, we also utilize variable-rent leases pursuant to which the amount of the rent depends on crop yields and prices in regions where such arrangements are prevalent. Adverse weather conditions, seasonal variability, crop disease, pests and contaminants, natural disasters and other natural conditions, including the effects of climate change, could adversely affect the value of production on properties. This could impact our variable rent proceeds and our tenants' ability to continue to meet their obligations to us. This could have a material adverse effect on the value of our properties, our results of operations, financial condition, and our ability to make distributions to our stockholders.

The market prices of the crops that our tenants may produce on our agricultural properties have exhibited periods of volatility, which may affect our tenants' ability to pay rent and thereby have a material adverse effect on our results of operations and our ability to make distributions to stockholders.

The value of a crop is affected by many factors that can differ on a yearly basis. The unpredictability of weather and crop yields in the major crop production regions worldwide creates a significant risk of price volatility, which may either increase or decrease the value of the crops that our tenants produce each year. Other material factors adding to the volatility of crop prices are changes in government regulations and policy, fluctuations in global prosperity, fluctuations in foreign trade and export markets, and eruptions of military conflicts or civil unrest. Although rental payments under the majority of our leases typically are not based on the quality or profitability of our tenants' harvests, any of these factors could adversely affect our tenants' ability to meet their obligations to us and our ability to lease or re-lease properties on favorable terms, or at all, which could have a material adverse effect on the value of our properties, our results of operations and our ability to make distributions to our stockholders.

The impacts of trade disputes and geopolitical conflicts, such as the ongoing war in Ukraine and in the Middle East, could adversely affect the profitability of our tenants’ farming operations, which could have a material adverse effect on our results of operations, financial condition, ability to make distributions to our stockholders and the value of our properties.

The potential for trade disputes between the United States and its primary agricultural trade partners has increased in recent years. This impacts the volatility of the market prices of certain crops that our tenants grow on our properties. There can be no assurances as to the impact of any change in trade policy on market prices of crops.

Similarly, our and our tenants’ operations are subject to risks stemming from geopolitical conflicts, such as the ongoing war in Ukraine and the conflict in the Middle East. Food prices were at near record highs before the beginning of the war in Ukraine and have increased as a result of the war. U.S. farmers have seen increased profitability as a result of rising prices. However, we can provide no assurances that this increased profitability is sustainable in light of inflationary pressures on farming costs, rising interest rates and other economic factors or that such increase will result in commensurate increases in rental rates.

A reduction in crop prices could adversely affect the profitability of our tenants and negatively impact their ability to make rental payments as they come due. If we are unable to recover the rental payments, our results of operations, financial condition and ability to make distributions to our stockholders could be materially and adversely affected. If we are required to remove a tenant, we may not be able to re-lease the property at current rental rates or at all. Furthermore, prolonged trade disputes or geopolitical conflicts that lead to a continuation of depressed crop prices could materially and adversely affect the underlying value of our properties.

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Adverse changes in government policies related to farming could affect the prices of crops and the profitability of farming operations, which could materially and adversely affect the value of our properties and our results of operations.

There are a number of government programs that directly or indirectly affect the profitability of farm operators. These include marketing, export, renewable fuel and insurance policies and programs. Significant changes to or the elimination of programs and policies could adversely affect crop prices and the profitability of farming operations, which could materially and adversely impact the value of our farms and our ability to lease them on favorable terms, or at all, which would have a material adverse effect on our results of operations.

We may be subject to unknown or contingent liabilities related to acquired properties and properties that we may acquire in the future, which could have a material adverse effect on us.

Properties that we have acquired, and properties that we may acquire in the future, may be subject to unknown or contingent liabilities (for example, environmental or related liabilities or liabilities related to water usage) for which we may have no recourse, or only limited recourse, against the sellers. In general, the representations and warranties provided under the transaction agreements related to the purchase of properties that we acquire may not survive the completion of the transactions. Furthermore, indemnification under such agreements may be limited and subject to various materiality thresholds, a significant deductible or an aggregate cap on losses. As a result, there is no guarantee that we will recover any amounts with respect to losses due to breaches by the sellers of their representations and warranties. In addition, the total amount of costs and expenses that may be incurred with respect to liabilities associated with these properties may exceed our expectations, and we may experience other unanticipated adverse effects, all of which may materially and adversely affect us.

The loss of key management personnel, particularly Paul A. Pittman and Luca Fabbri, could have a material adverse effect on our ability to implement our business strategy and to achieve our investment objectives.

Our future success depends to a significant extent on the continued service and coordination of our senior management team. We can provide no assurances that any of our key personnel will continue their employment with us. In particular, the loss of the services of Mr. Paul A. Pittman, our Executive Chairman of the Board of Directors, or Mr. Luca Fabbri, our President, Chief Executive Officer and a member of our Board of Directors, could have a material adverse effect on our ability to implement our business strategy and to achieve our investment objectives.

Joint venture investments could be adversely affected by our lack of sole decision-making authority, our reliance on co-venturers’ financial condition and disputes between us and our co-venturers.

We have entered into joint investments (including our ownership interest in the OZ Fund) and may in the future, co-invest with third parties through partnerships, joint ventures or other entities, acquiring noncontrolling interests in or sharing responsibility for developing properties and managing the affairs of a property, partnership, joint venture or other entity. With respect to our ownership interest in the OZ Fund and any similar arrangements that we may enter into in the future, we are not, and in the future may not be, in a position to exercise any decision-making authority regarding the property, partnership, joint venture or other entity. Such joint investments in partnerships, joint ventures or other entities may, under certain circumstances, involve risks not otherwise present with a direct investment in farmland properties, including the possibility that partners or co-venturers might become bankrupt or fail to fund their share of required capital contributions. Partners or co-venturers may have economic or other business interests or goals which are inconsistent with our business interests or goals and may be in a position to take actions contrary to our policies or objectives, and they may have competing interests in our markets that could create conflicts of interest. Such investments may also have the potential risk of impasses on decisions, such as a sale or financing, because neither we nor the partner(s) or co-venturer(s) would have full control over the partnership or joint venture. In addition, a sale or transfer by us to a third party of our interests in the joint venture may be subject to consent rights or rights of first refusal, in favor of our joint venture partners, which would in each case restrict our ability to dispose of our interest in the joint venture. Where we are a limited partner or non-managing member in any partnership or limited liability company, if such entity takes or expects to take actions that could jeopardize our status as a REIT or require us to pay tax, we may be forced to dispose of our interest in such entity. Disputes

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between us and partners or co-venturers may result in litigation or arbitration that would increase our expenses and prevent our officers and directors from focusing their time and effort on our business. Consequently, actions by or disputes with partners or co-venturers might result in subjecting properties owned by the partnership or joint venture to additional risk. In addition, we may in certain circumstances be liable for the actions of our third-party partners or co-venturers. Our joint ventures may be subject to debt and, during periods of volatile credit markets, the refinancing of such debt may require equity capital calls.

We may fail to realize some or all of the anticipated benefits of our ownership interest in the OZ Fund, our long-term management agreement with the OZ Fund, the acquisition of MWA and the launch of a joint asset management platform with MWA, or those benefits may take longer to realize than expected. We may also encounter significant difficulties in managing the business and operations of OZ Fund and MWA client properties. The future results of our Company will suffer if we do not effectively manage properties on behalf of the OZ Fund and MWA clients.

Our ability to realize the anticipated benefits of our ownership interest in the OZ Fund, our long-term management agreement with the OZ Fund, the acquisition of MWA and the asset management platform within MWA depends, in part, on our ability to successfully manage the business and operations of OZ Fund and MWA client properties. Following the consummation of the long-term management agreement with the OZ Fund and the acquisition of MWA, the number of acres of third-party farmland under our management increased significantly. If we fail to operate these business lines successfully, we may suffer losses.

Furthermore, our ownership interest in the OZ Fund, the acquisition of MWA and our management of OZ Fund and MWA client properties could expose us to unknown or contingent liabilities that were not discovered during the course of due diligence. These liabilities could include exposure to unexpected environmental problems, compliance and regulatory violations, key employee and client retention problems and other problems that could result in significant costs to us. Many of these factors are outside our control, and any one of them could result in increased costs and liabilities, decreases in the amount of expected revenues, earnings and cash flows, and diversion of management’s time and energy, which could have a material adverse effect on the business of the OZ Fund, MWA and/or us. All of these factors could negatively impact the asset management fees we expect to earn from the management of OZ Fund and MWA client properties and the returns we anticipate receiving from our ownership interest in the OZ Fund and the acquisition of MWA, all of which could negatively impact the price of our common stock, or have a material adverse effect on our business, financial condition and results of operations.

We are exposed to risks associated with the management of third-party owned farmland and ancillary agricultural business activities and failure to succeed in new markets and these new lines of business may have adverse consequences.

Through our long-term management agreement with the OZ Fund, property management business activity within MWA and our November 2022 purchase of land and buildings for four agriculture equipment dealerships in Ohio leased to Ag Pro under the John Deere brand, we engage in property management activities on behalf of third-party property owners and lease out new agricultural-related properties, and may continue to pursue similar strategic activities if appropriate opportunities arise. Our historical experience in our existing markets in acquiring, owning and leasing farmland does not ensure that we will be able to operate successfully in new markets or in new lines of business. We may be exposed to a variety of risks when we enter a new market, property management opportunity or ancillary agricultural business activity, including an inability to accurately evaluate local market conditions and a lack of familiarity with local tenants. We may be unsuccessful in managing farmland properties on behalf of third-parties or leasing out agricultural equipment dealerships, which could have a material adverse effect on our results of operations and we may be liable and/or our status as a REIT may be jeopardized if the third-party farmland management or agricultural equipment dealership facilities cause us to fail to comply with various tax or other regulatory matters.

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If we fail to maintain effective internal controls over financial reporting, we may not be able to accurately report our financial results, which may adversely affect investor confidence in our Company and, as a result, the value of our common stock.

Our management is responsible for establishing and maintaining adequate internal controls over financial reporting. While our Annual Report on Form 10-K for the year ended December 31, 2019 contained an independent auditor’s attestation report pursuant to Section 404(b) of the Sarbanes-Oxley Act of 2002, as amended (the “Sarbanes-Oxley Act”), we are not required to include such an audit report in this Annual Report. We have identified material weaknesses in the past. While we believe we have remediated all past material weaknesses, we cannot give any assurances that other material weaknesses will not be identified in the future in connection with our compliance with the provisions of Section 404 of the Sarbanes-Oxley Act. The existence of any material weakness would preclude a conclusion by management and our independent auditors that we maintained effective internal control over financial reporting. Our management may be required to devote significant time and expense to remediate any material weaknesses that may be discovered and may not be able to remediate any material weakness in a timely manner. The existence of any material weakness in our internal control over financial reporting could also result in errors in our financial statements that could require us to restate our financial statements, cause us to fail to meet our reporting obligations and cause investors to lose confidence in our reported financial information, all of which could lead to a decline in the per-share trading price of our common stock. In addition, at the time we no longer qualify as a smaller reporting company, we will be required to include an auditor attestation report pursuant to Section 404 of the Sarbanes Oxley Act, which will cause us to incur additional expenses, which may be significant.

Under the FPI Loan Program, we provide loans to third-party farmers, which exposes us to risks associated with being a lender, including the risk that borrowers default on their obligations to us, which could adversely affect our results of operations and financial condition.

Under the FPI Loan Program, we make loans to third-party farmers (both tenant and non-tenant) to provide financing for borrowers’ working capital requirements and operational farming activities, farming infrastructure projects, and for other farming and agricultural real estate related purposes. As of December 31, 2023, we have made loans to twelve distinct borrowers with original principal amounts totaling $36.7 million. These loans consist of: 15 loan agreements which were originally secured by senior first-lien mortgage loans secured against farmland; one loan is secured by a second mortgage secured against farmland and a personal guaranty; three loan agreements which were originally secured by working capital assets of the borrower; and one loan agreement which was originally secured by equipment of the borrower. As of December 31, 2023, the remaining loan balances total $13.9 million (representing 1% of our total assets as of December 31, 2023), of which $13.4 million were secured by senior first-lien mortgages and $0.5 million was secured by a second mortgage. We intend to make similar loans under the FPI Loan Program in the future. Payments on such loans depend on the profitable operation or management of the farmland or farmland-related property securing the loan or the maintenance of any equipment, or other assets securing the loan. The success of the farmland or farm-related property may be affected by many factors outside the control of the borrower, including adverse weather conditions that prevent the planting of a crop or limit crop yields, declines in market prices for agricultural products (both domestically and internationally) and the impact of government regulations (including changes in price supports, subsidies and environmental regulations). In addition, many farms are dependent on a limited number of key individuals whose injury or death may significantly affect the successful operation of the farm. If the cash flow from a farming operation is diminished, the borrower's ability to repay the loan may be impaired. If a borrower defaults under a loan for which we are the lender, we may attempt to foreclose on the collateral securing the loan, including by acquiring title to the subject property, crops, or equipment, to protect our investment. In response, the defaulting borrower may contest our enforcement of foreclosure or other available remedies, seek bankruptcy protection against our exercise of enforcement or other available remedies, or bring claims against us for lender liability. If a defaulting borrower seeks bankruptcy protection, the automatic stay provisions of the U.S. Bankruptcy Code would preclude us from enforcing foreclosure or other available remedies against the borrower unless relief is first obtained from the court with jurisdiction over the bankruptcy case. In addition, we may be subject to intercreditor agreements that delay, impact, govern or limit our ability to foreclose on a lien securing a loan or otherwise delay or limit our pursuit of our rights and remedies. Any such delay or limit on our ability to pursue our rights or remedies could adversely affect our business, results of operations and ability to make distributions to our stockholders. In the event of a foreclosure, we may assume direct ownership of the underlying farm. Even if we successfully foreclose on the collateral securing our mortgage loans, foreclosure-related costs, high loan-to-value ratios or

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declines in property values could prevent us from realizing the full amount of our mortgage loans, and we could be required to record a valuation allowance for such losses.

Liability for uninsured or underinsured losses could materially and adversely affect our financial condition and cash flow.

Our properties may be damaged by adverse weather conditions and natural disasters, such as earthquakes, floods and tornadoes. Our insurance may not be adequate to cover all damages or losses from these events, or we may view it as not economically prudent to purchase insurance for certain types of losses. Should an uninsured loss occur, we could lose our capital investment or anticipated profits and cash flows from one or more properties. If any such loss is insured, we may be required to pay a significant deductible on any claim for recovery of such a loss prior to our insurer being obligated to reimburse us for the loss, or the amount of the loss may exceed our coverage for the loss, which could have an adverse effect on our cash flow.

We have previously been subject to, and may in the future be subject to, litigation or threatened litigation, which may require us to pay damages and expenses or restrict the operation of our business.

We have previously been subject to, and may be subject in the future, to litigation or threatened litigation, including claims relating to the actions of our tenants, claims brought by stockholders, and otherwise in the ordinary course of business. In particular, we are subject to the risk of complaints by our tenants involving premises liability claims and alleged violations of landlord-tenant laws, which may give rise to litigation or governmental investigations, as well as claims and litigation relating to real estate rights or uses of our properties. Additionally, whether or not any dispute actually proceeds to litigation, we may be required to pay damages or expenses, which may be significant, or involve our agreement with terms that restrict the operation of our business. We generally intend to vigorously defend ourselves; however, we cannot be certain of the ultimate outcomes of pending claims against the Company or of those claims that may arise in the future. Resolution of these types of matters against us may result in our having to pay significant fines, judgments, or settlements, which, if uninsured, or if the fines, judgments, and settlements exceed insured levels, could adversely impact our earnings and cash flows, thereby having an adverse effect on our financial condition, results of operations, cash flows and our ability to pay distributions on, and the per share trading price of, our common stock. Certain litigation or the resolution of certain litigation may affect the availability or cost of some of our insurance coverage and could expose us to increased risks that would be uninsured, and/or adversely impact our ability to attract officers and directors, which could adversely impact our results of operations, cash flows and our ability to pay distributions on, and the value of, our common and preferred stock. For more information about our resolved and ongoing legal proceedings see “Note 8—Commitments and Contingencies” to our Consolidated Financial Statements included in Part IV, Item 8 of this Annual Report on Form 10-K.

We may incur significant unrecoverable costs if we are not successful in connection with the litigation we have filed against Sabrepoint.

As described in further detail in “Note 8—Commitments and Contingencies” to our Consolidated Financial Statements included in Part IV, Item 8 of this Annual Report on Form 10-K, on July 2, 2021, the Company filed a complaint against First Sabrepoint Capital Management, LP, Sabrepoint Capital Partners, LP, Sabrepoint Capital Participation, LP, George Baxter, and Donald Marchiony (collectively, “Sabrepoint”) seeking relief for Sabrepoint’s alleged role in a “short and distort scheme” to profit from an artificial decline in the Company’s stock price stemming from an article posted on Seeking Alpha, which contained numerous false statements about the Company. On December 17, 2021, the Company's claims against Sabrepoint were dismissed by the court , which granted (i) Sabrepoint's motion for summary judgment on collateral estoppel grounds, and (ii) motion to dismiss pursuant to the Texas Citizens Participation Act (“TCPA”). On March 21, 2022, after the Company filed a notice signaling an intent to appeal both orders, the Court of Appeals for the Fifth District of Texas (the “Court of Appeals”) entered an order declaring the trial court's TCPA order “VOID because the motion was denied by operation of law….” Accordingly, the Company narrowed its appeal to the trial court's grant of summary judgment. On January 26, 2022, Sabrepoint filed a motion for attorney's fees relating to the defense of that action. The trial court granted the motion for certain fees claimed by Sabrepoint as relating to its pursuit of its TCPA motion, but as noted above, the Court of Appeals subsequently overturned the TCPA order that formed the basis of Sabrepoint’s fee request, mooting the motion and the Court’s order on the same. On June 30, 2023, the Court of Appeals granted the

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Company’s appeal, determining that the Company’s claims against Sabrepoint are not barred, reversing the trial court and remanding the case for further proceedings on the merits. On October 13, 2023, Sabrepoint filed a Petition for Review with the Texas Supreme Court, requesting the court to review the Court of Appeals’ decision. The Company filed a response to the Sabrepoint Petition for Review with the Texas Supreme Court on December 27, 2023, and on February 16, 2024, the Texas Supreme Court requested a briefing on the merits. The petition is now fully briefed and pending a decision from the court. For more information see “Note 8—Commitments and Contingencies” to our Consolidated Financial Statements included in Part IV, Item 8 of this Annual Report on Form 10-K. We may not be successful in this litigation, in which case we would have incurred significant costs and expenses. Even if we are successful, there can be no assurance that we will be able to recover damages. To the extent that any such adverse effects exceed any benefits we may realize from pursuing this litigation, our business, prospects, financial condition and results of operations may suffer materially.

A cybersecurity incident and other technology disruptions could result in a violation of law or negatively impact our reputation and relationships with our tenants, any of which could have a material adverse effect on our results of operations and our financial condition.

Information and security risks have generally increased in recent years due to the rise in new technologies and the increased sophistication and activities of perpetrators of cyber-attacks. We use computers in substantially all aspects of our business operations, and we also use mobile devices and other online activities to connect with our employees and tenants. Such uses give rise to cybersecurity risks, including security breach, espionage, system disruption, theft and inadvertent release of information. We have in the past experienced cyberattacks on our computers and computer networks, and, while none to date have been material, we expect that additional cyberattacks will occur in the future. Our business involves the storage and transmission of numerous classes of sensitive and/or confidential information and intellectual property, including tenants’, suppliers’ and employees’ personally identifiable information and financial and strategic information about us.

If we fail to assess and identify cybersecurity risks associated with our operations, we may become increasingly vulnerable to such risks. Even the most well protected information, networks, systems and facilities remain potentially vulnerable because the techniques used in such attempted security breaches evolve and generally are not recognized until launched against a target, and in some cases are designed not to be detected and, in fact, may not be detected. Accordingly, we and our suppliers may be unable to anticipate these techniques or to implement adequate security barriers or other preventative measures, and thus it is impossible for us and our suppliers to entirely mitigate this risk. Further, in the future we may be required to expend additional resources to continue to enhance information security measures and/or to investigate and remediate any information security vulnerabilities. We can provide no assurances that the measures we have implemented to prevent security breaches and cyber incidents will be effective in the event of a cyber-attack.

The theft, destruction, loss, misappropriation or release of sensitive and/or confidential information or intellectual property, or interference with our information technology systems or the technology systems of third-parties on which we rely, could result in business disruption, negative publicity, violation of privacy laws, loss of tenants, potential liability and competitive disadvantage, any of which could result in a material adverse effect on financial condition or results of operations.

For more information on cybersecurity, see “Item 1C. Cybersecurity Disclosure.”

Potential liability for environmental matters could materially and adversely affect our results of operations and financial condition.

We are subject to the risk of liabilities under federal, state and local environmental laws applicable to agricultural properties, including those related to wetlands, groundwater and water runoff. Some of these laws could subject us to:

responsibility and liability for the cost of removal or remediation of hazardous substances released on our properties, generally without regard to our knowledge of or responsibility for the presence of the contaminants;
liability for the costs of investigation, removal or remediation of hazardous substances or chemical releases at disposal facilities for persons who arrange for the disposal or treatment of these substances; and

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potential liability for claims by third parties for damages resulting from environmental contaminants.

Environmental site assessments were not conducted on all the farms in our portfolio and we do not expect to conduct environment site assessments on all farms we acquire in the future. Our costs of investigation, remediation or removal of hazardous substances may be substantial. In addition, the presence of hazardous substances on one of our properties, or the failure to properly remediate a contaminated property, could adversely affect our ability to sell or lease the property or to borrow using the property as collateral. We may be subject to common law claims by third parties based on damages and costs resulting from environmental contamination emanating from the property. Additionally, we could become subject to new, stricter environmental regulations, which could diminish the utility of our properties and have a material adverse impact on our results of operations and financial condition.

We may be required to permit the owners of certain third-party access rights on our properties to enter and occupy parts of the properties, including owners of mineral rights and power generation and transportation infrastructure, which could materially and adversely impact the rental value of our properties.

Although we own the surface rights to our farms and expect to own the surface rights to properties that we acquire in the future, other persons or entities may own third-party access rights on our properties based upon their ownership of certain minerals, power generation and transportation infrastructure or similar property rights. Some of these third-party access rights, such as those related to oil, water or natural gas may be located under the surfaces of these properties, while others, particularly those third-party access rights related to power generation and transportation infrastructure such as wind turbines or oil pipelines, may be located on or above the surfaces of these properties. For example, in connection with our acquisition of a group of farms in Colorado and Kansas, the seller retained 50% of the mineral rights related to the farm. Currently there is no mineral development or significant power generation and transportation infrastructure on the farms in our portfolio other than on properties for which we own the rights, but we can provide no assurances that third parties will not assert claims for mineral rights, third-party access rights related to power generation and transportation infrastructure and other related property rights on the farms in our portfolio or that farmland that we acquire in the future will not be subject to these third-party access rights. To the extent that third parties have third-party rights on farmland that we currently own or acquire in the future, we expect that we would be required to permit third parties to enter our properties for the purpose of such activities as drilling and operating oil or gas wells, operating and maintaining oil pipelines and operating and maintaining wind turbines on the premises. We may also be required to set aside a reasonable portion of the surface area of our properties to accommodate these operations. The devotion of a portion of our properties to these operations would reduce the amount of the surface available for farming or farm-related uses. Such activities might also disrupt the productivity of the farmland or property related to farming or increase the risk of environmental liabilities, any of which could adversely impact the rents that we receive from leasing these properties.

We are subject to risks associated with public health crises, such as pandemics and epidemics which may have a material adverse effect on our business. The nature and extent of future impacts are highly uncertain and unpredictable.

We are subject to risks associated with public health crises, such as pandemics and epidemics. Our rental revenue and operating results depend significantly on the ability of our tenants to meet their rent and other obligations to us. If the impacts of a future public health crisis continue for an extended period of time, we expect that certain tenants may experience financial distress, which could result in late payments, requests for rental relief, business closures, rent concessions or other accommodations, as applicable. In some cases, we may have to restructure tenants’ long-term rent obligations and may not be able to do so on terms that are as favorable to us as those currently in place.

The scope and duration of any future public health crisis, including the potential emergence of new variants of the COVID-19 virus, the pace at which government restrictions are imposed and lifted, the scope of additional actions taken to mitigate the spread of disease, global vaccination and booster rates, the speed and extent to which global markets and utilization rates for our products fully recover from the disruptions caused by such a public health crisis, and the impact of these factors on our business, financial condition and results of operations, will depend on future developments that are highly uncertain and cannot be predicted with confidence.

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To the extent public health crises adversely affect our operations and global economic conditions more generally, it may also have the effect of heightening many of the other risks described herein.

Risks Related to Our Organizational Structure

Conflicts of interest may exist or could arise in the future between the interests of our stockholders and the interests of holders of units in our Operating Partnership, which may impede business decisions that could benefit our stockholders.

Although holders of our Common units do not have voting rights or the power to direct the Company’s affairs, there could be potential conflicts, conflicts of interest may exist or could arise in the future as a result of the relationships between us and our affiliates, on the one hand, and our Operating Partnership or any partner thereof.

Our directors and officers have duties to our company under Maryland law in connection with their management of our Company. At the same time, our wholly owned subsidiary, Farmland Partners OP GP, LLC, as the general partner of our Operating Partnership, has fiduciary duties and obligations to our Operating Partnership and its limited partners under Delaware law and the partnership agreement in connection with the management of our Operating Partnership. The general partner's fiduciary duties and obligations as the general partner of our Operating Partnership may come into conflict with the duties of our directors and officers to our Company. These conflicts of interest could lead to decisions that are not in the best interests of the Company and its stockholders.

Unless otherwise provided for in a partnership agreement, Delaware law generally requires a general partner of a Delaware limited partnership to adhere to fiduciary duty standards under which it owes its limited partners the highest duties of good faith, fairness and loyalty and which generally prohibit such general partner from taking any action or engaging in any transaction as to which it has a conflict of interest. The partnership agreement provides that, in the event of a conflict between the interests of the limited partners of our Operating Partnership, on the one hand, and the separate interests of our stockholders, on the other hand, the general partner, in its capacity as the general partner of our Operating Partnership, shall act in the interests of our stockholders and is under no obligation to consider the separate interests of the limited partners of our Operating Partnership in deciding whether to cause our Operating Partnership to take or not to take any actions. The partnership agreement further provides that any decisions or actions not taken by the general partner in accordance with the partnership agreement will not violate any duties, including the duty of loyalty, that the general partner, in its capacity as the general partner of our Operating Partnership, owes to our Operating Partnership and its partners.

Additionally, the partnership agreement provides that the general partner will not be liable to our Operating Partnership or any partner for monetary damages for losses sustained, liabilities incurred or benefits not derived by our Operating Partnership or any limited partner unless the general partner acted in bad faith and the act or omission was material to the matter giving rise to the loss, liability or benefit not derived. Our Operating Partnership must indemnify the general partner, us, our directors and officers, officers of our Operating Partnership and others designated by the general partner from and against any and all claims that relate to the operations of our Operating Partnership, unless (1) an act or omission of the indemnified person was material to the matter giving rise to the action and either was committed in bad faith or was the result of active and deliberate dishonesty, (2) the indemnified person actually received an improper personal benefit in money, property or services or (3) in the case of a criminal proceeding, the indemnified person had reasonable cause to believe that the act or omission was unlawful. Our Operating Partnership must also pay or reimburse the reasonable expenses of any such person upon its receipt of a written affirmation of the person's good faith belief that the standard of conduct necessary for indemnification has been met and a written undertaking to repay any amounts paid or advanced if it is ultimately determined that the person did not meet the standard of conduct for indemnification. Our Operating Partnership will not indemnify or advance funds to any person with respect to any action initiated by the person seeking indemnification without our approval (except for any proceeding brought to enforce such person's right to indemnification under the partnership agreement) or if the person is found to be liable to our Operating Partnership on any portion of any claim in the action. No reported decision of a Delaware appellate court has interpreted provisions similar to the provisions of the partnership agreement that modify and reduce our fiduciary duties or obligations as the sole member of the general partner or reduce or eliminate our liability for money damages to our Operating Partnership and its partners, and we have not obtained an opinion of counsel as to the enforceability of the provisions set forth in the partnership

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agreement that purport to modify or reduce the fiduciary duties that would be in effect were it not for the partnership agreement.

Our charter contains certain provisions restricting the ownership and transfer of our stock that may delay, defer or prevent a change of control transaction that might involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests.

Our charter contains certain ownership limits with respect to our stock. Our charter, among other restrictions, prohibits the beneficial or constructive ownership by any person of more than 9.8% in value or number of shares, whichever is more restrictive, of the outstanding shares of any class or series of our stock, excluding any shares that are not treated as outstanding for U.S. federal income tax purposes. Our Board of Directors, in its sole and absolute discretion, may exempt a person, prospectively or retroactively, from this ownership limit if certain conditions are satisfied. This ownership limit as well as other restrictions on ownership and transfer of our stock in our charter may:

discourage a tender offer or other transactions or a change in management or of control that might involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests; and
result in the transfer of shares acquired in excess of the restrictions to a trust for the benefit of a charitable beneficiary and, as a result, the forfeiture by the acquirer of certain of the benefits of owning the additional shares.

We could increase the number of authorized shares of stock, classify and reclassify unissued stock and issue stock without stockholder approval, which may delay, defer or prevent a transaction that our stockholders believe to be in their best interests.

Our Board of Directors, without stockholder approval, has the power under our charter to amend our charter to increase or decrease the aggregate number of shares of stock or the number of shares of stock of any class or series that we are authorized to issue. In addition, under our charter, our Board of Directors, without stockholder approval, has the power to authorize us to issue authorized but unissued shares of our common stock or preferred stock and to classify or reclassify any unissued shares of our common stock or preferred stock into one or more classes or series of stock and set the preference, conversion or other rights, voting powers, restrictions, limitations as to dividends and other distributions, qualifications or terms or conditions of redemption for such newly classified or reclassified shares. As a result, we may issue series or classes of common stock or preferred stock with preferences, dividends, powers and rights, voting or otherwise, that are senior to, or otherwise conflict with, the rights of holders of our common stock. Although our Board of Directors has no such intention at the present time, it could establish a class or series of preferred stock that could, depending on the terms of such series, delay, defer or prevent a transaction or a change of control that might involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests.

Certain provisions of Maryland law could inhibit changes in control, which may discourage third parties from conducting a tender offer or seeking other change of control transactions that could involve a premium price for our common stock or that our stockholders otherwise believe to be in their best interests.

Certain provisions of the Maryland General Corporation Law (the “MGCL”) may have the effect of inhibiting a third party from making a proposal to acquire us or of impeding a change of control under certain circumstances that otherwise could provide the holders of shares of our common stock with the opportunity to realize a premium over the then-prevailing market price of such shares, including:

“business combination” provisions that, subject to limitations, prohibit certain business combinations between us and an “interested stockholder” (defined generally as any person who beneficially owns 10% or more of the voting power of our outstanding voting stock or any affiliate or associate of ours who, at any time within the two-year period immediately prior to the fixed annual ratedate in question, was the beneficial owner of $1.50 per share). Beginning10% or more of the voting power of our then outstanding stock) or an affiliate thereof for five years after the most recent date on September 30, 2024, dividends will accrue which the stockholder becomes an interested stockholder and thereafter impose fair price and/or supermajority voting requirements on these combinations; and 
“control share” provisions that provide that “control shares” of our Company (defined as shares which, when aggregated with other shares controlled by the stockholder, except solely by virtue of a revocable proxy, entitle

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the stockholder to exercise one of three increasing ranges of voting power in electing directors) acquired in a “control share acquisition” (defined as the direct or indirect acquisition of ownership or control of issued and outstanding “control shares”) have no voting rights with respect to their control shares except to the extent approved by our stockholders by the affirmative vote of at least two-thirds of all the votes entitled to be paidcast on the matter, excluding all interested shares.

By resolution of our Board of Directors, we have opted out of the business combination provisions of the MGCL and provided that any business combination between us and any other person is exempt from the business combination provisions of the MGCL, provided that the business combination is first approved by our Board of Directors (including a majority of directors who are not affiliates or associates of such persons). In addition, pursuant to a provision in our bylaws, we have opted out of the control share provisions of the MGCL. However, our Board of Directors may by resolution elect to opt in to the business combination provisions of the MGCL and we may, by amendment to our bylaws, opt in to the control share provisions of the MGCL in the future.

Additionally, certain provisions of the MGCL permit our Board of Directors, without stockholder approval and regardless of what is currently provided in our charter or our bylaws, to implement takeover defenses, some of which (for example, a classified board) we do not currently employ. These provisions may have the effect of inhibiting a third party from making an acquisition proposal for our Company or of delaying, deferring, or preventing a change in control of our Company under circumstances that otherwise could provide the holders of our common stock with the opportunity to realize a premium over the then-current market price. Our charter contains a provision whereby we elect to be subject to the provisions of Title 3, Subtitle 8 of the MGCL relating to the filling of vacancies on our Board of Directors.

Our charter, our bylaws and Maryland law also contain other provisions, including the provisions of our charter on removal of directors and the advance notice provisions of our bylaws, that may delay, defer, or prevent a transaction or a change of control that might involve a premium price for our common stock or otherwise be in the best interest of our stockholders.

Certain provisions in the partnership agreement may delay or prevent unsolicited acquisitions of us.

Provisions in the partnership agreement may delay, or make more difficult, unsolicited acquisitions of us or changes of our control. These provisions could discourage third parties from making proposals involving an unsolicited acquisition of us or change of our control, although some of our stockholders might consider such proposals, if made, desirable. These provisions include, among others:

redemption rights;
a requirement that the general partner may not be removed as the general partner of our Operating Partnership without our consent;
transfer restrictions on Common units;
our ability, as general partner, in some cases, to amend the partnership agreement and to cause our Operating Partnership to issue units with terms that could delay, defer or prevent a merger or other change of control of us or our Operating Partnership without the consent of the limited partners; and
the right of the limited partners to consent to direct or indirect transfers of the general partnership interest, including as a result of a merger or a sale of all or substantially all of our assets, in the event that such transfer requires approval by our common stockholders.

Our Board of Directors may change our strategies, policies and procedures without stockholder approval.

Our investment, financing, leverage and distribution policies, and our policies with respect to all other activities, including growth, capitalization and operations, are determined exclusively by our Board of Directors, and may be amended or revised at any time by our Board of Directors without notice to or a vote of our stockholders. This could result in us conducting operational matters, making investments or pursuing different business or growth strategies than those contemplated in this Annual Report on Form 10-K. Further, our charter and bylaws do not limit the amount or percentage of indebtedness, funded or otherwise, that we may incur. Our Board of Directors may alter or eliminate our current policy on borrowing at any time without stockholder approval. If this policy changed, we could become more highly leveraged

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which could result in an increase in our debt service. Higher leverage also increases the risk of default on our obligations. In addition, a change in our investment policies, including the manner in which we allocate our resources across our portfolio or the types of assets in which we seek to invest, may increase our exposure to interest rate risk, real estate market fluctuations and liquidity risk. Changes to our policies with regards to the foregoing could materially adversely affect our financial condition, results of operations and cash flow.

Our rights and the rights of our stockholders to take action against our directors and officers are limited, which could limit your recourse in the event that we take certain actions which are not in our stockholders' best interests.

Maryland law provides that a director or officer has no liability in that capacity if he or she performs his or her duties in good faith, in a manner that he or she reasonably believes to be in our best interests and with the care that an ordinarily prudent person in a like position would use under similar circumstances. Under the MGCL, directors are presumed to have acted with this standard of care. As permitted by Maryland law, our charter eliminates the liability of our directors and officers to us and our stockholders for money damages, except for liability resulting from:

actual receipt of an improper benefit or profit in money, property or services; or
active and deliberate dishonesty by the director or officer that was established by a final judgment as being material to the cause of action adjudicated.

Our charter and bylaws obligate us to indemnify each present and former director or officer, to the maximum extent permitted by Maryland law, in the defense of any proceeding to which he or she is made, or threatened to be made, a party by reason of his or her service to us. In addition, we may be obligated to advance the defense costs incurred by our directors and officers. We also have entered into indemnification agreements with our officers and directors granting them express indemnification rights. As a result, we and our stockholders may have more limited rights against our directors and officers than might otherwise exist absent the current provisions in our charter, bylaws and indemnification agreements or that might exist for other public companies.

Our charter contains provisions that make removal of our directors difficult, which could make it difficult for our stockholders to effect changes to our management.

Our charter contains provisions that make removal of our directors difficult, which could make it difficult for our stockholders to effect changes to our senior management and may prevent a change in control of our Company that is in the best interests of our stockholders. Our charter provides that a director may only be removed for cause upon the affirmative vote of holders of two-thirds of all the votes entitled to be cast generally in the election of directors. Vacancies may be filled only by a majority of the remaining directors in office, even if less than a quorum. These requirements make it more difficult to change our senior management by removing and replacing directors and may prevent a change in control of our Company that is in the best interests of our stockholders.

Our Operating Partnership may issue additional Common units or one or more classes of preferred units to third parties without the consent of our stockholders, which would reduce our ownership percentage in our Operating Partnership and could have a dilutive effect on the amount of distributions made to us by our Operating Partnership and, therefore, the amount of distributions we can make to our stockholders.

As of December 31, 2023, we owned approximately 97.6% of the outstanding Common units in our Operating Partnership (on a fully diluted basis). Since our initial public offering, we have issued a total of 8.0 million Common units and a total of 117,000 Series A preferred units as consideration in connection with our acquisition of properties, and we may issue additional Common units and Series A preferred units of one or more classes in connection with our acquisition of properties, as compensation or otherwise. Such issuances would reduce our ownership percentage in our Operating Partnership and could affect the amount of distributions made to us by our Operating Partnership and, therefore, the amount of distributions we can make to our stockholders. Our common stockholders do not have any voting rights with respect to any such issuances or other partnership level activities of our Operating Partnership.

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Certain aspects of our Series A preferred units may limit our ability to make distributions to our common stockholders.

The distribution rate on our Series A preferred units is fixed, and no distributions can be paid to our common stockholders unless we have paid all cumulative dividends on our Series A preferred units. The distribution preference of our Series A preferred units could materially and adversely affect our cash flow and ability to make distributions to our common stockholders.

U.S. Federal Income Tax Risks

Failure to maintain qualification as a REIT for U.S. federal income tax purposes would subject us to U.S. federal income tax on our taxable income at regular corporate rates, which would substantially reduce our ability to make distributions to our stockholders.

We elected to be taxed as a REIT for U.S. federal income tax purposes beginning with our short taxable year ended December 31, 2014. To maintain qualification as a REIT, we must meet various requirements set forth in the Code concerning, among other things, the ownership of our outstanding stock, the nature of our assets, the sources of our income and the amount of our distributions. The REIT qualification requirements are extremely complex, and interpretations of the U.S. federal income tax laws governing qualification as a REIT are limited. We believe that our current organization and method of operation will enable us to continue to qualify as a REIT. However, at any time, new laws, interpretations or court decisions may change the U.S. federal tax laws relating to, or the U.S. federal income tax consequences of, qualification as a REIT. It is possible that future economic, market, legal, tax or other considerations may cause our Board of Directors to determine that it is not in our best interest to qualify as a REIT and to revoke our REIT election, which it may do without stockholder approval.

If we fail to qualify as a REIT for any taxable year, we will be subject to U.S. federal income tax on our taxable income at regular corporate rates. In addition, we generally would be disqualified from treatment as a REIT for the four taxable years following the year in which we lost our REIT status. Losing our REIT status would reduce our net earnings available for investment or distribution because of the additional tax liability. In addition, distributions would no longer qualify for the dividends paid deduction, and we would no longer be required to make distributions. If this occurs, we might be required to borrow funds or liquidate some investments in order to pay the applicable tax.

As a result of all these factors, our failure to qualify as a REIT could impair our ability to expand our business and raise capital, and would substantially reduce our ability to make distributions to our stockholders.

To qualify as a REIT and to avoid the payment of U.S. federal income and excise taxes, we may be forced to borrow funds, use proceeds from the issuance of securities, pay taxable dividends of our stock or debt securities or sell assets to make distributions, which may result in our distributing amounts that may otherwise be used for our operations.

To obtain the favorable tax treatment accorded to REITs, we normally are required each year to distribute to our stockholders at least 90% of our REIT taxable income, determined without regard to the deduction for dividends paid and by excluding net capital gains. We will be subject to U.S. federal income tax on our undistributed taxable income and net capital gain and to a 4% nondeductible excise tax on any amount by which distributions we pay with respect to any calendar year are less than the sum of (1) 85% of our ordinary income, (2) 95% of our capital gain net income and (3) 100% of our undistributed income from prior years. These requirements could cause us to distribute amounts that otherwise would be spent on acquisitions of properties and it is possible that we might be required to borrow funds, use proceeds from the issuance of securities, pay taxable dividends of our stock or debt securities or sell assets in order to distribute enough of our taxable income to maintain our qualification as a REIT and to avoid the payment of U.S. federal income and excise taxes.

Future sales of properties may result in penalty taxes or may be made through TRSs, each of which would diminish the return to you.

It is possible that one or more sales of our properties may be “prohibited transactions” under provisions of the Code. If we are deemed to have engaged in a “prohibited transaction” (i.e., we sell a property held by us primarily for sale in the ordinary course of our trade or business), all income that we derive from such sale would be subject to a 100% tax. The

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Code sets forth a safe harbor for REITs that wish to sell property without risking the imposition of the 100% tax. A principal requirement of the safe harbor is that the REIT must hold the applicable property for not less than two years prior to its sale for the production of rental income. It is entirely possible that a future sale of one or more of our properties will not fall within the prohibited transaction safe harbor.

If we acquire a property that we anticipate will not fall within the safe harbor from the 100% penalty tax upon disposition, we may acquire such property through a TRS in order to avoid the possibility that the sale of such property will be a prohibited transaction and subject to the 100% penalty tax. If we already own such a property directly or indirectly through an entity other than a TRS, we may contribute the property to a TRS. Though a sale of such property by a TRS likely would mitigate the risk of incurring a 100% penalty tax, the TRS itself would be subject to regular corporate income tax at the U.S. federal level, and potentially at the state and local levels, on the gain recognized on the sale of the property as well as any income earned while the property is operated by the TRS. Such tax would diminish the amount of proceeds from the sale of such property ultimately distributable to our stockholders. Our ability to use TRSs in the foregoing manner is subject to limitation. Among other things, the value of our securities in TRSs may not exceed 20% of the value of our assets and dividends from our TRSs, when aggregated with all other non-real estate income with respect to any one year, generally may not exceed 25% of our gross income with respect to such year. No assurances can be provided that we would be able to successfully avoid the 100% penalty tax through the use of TRSs.

In addition, if we acquire any asset from a C corporation (i.e., a corporation generally subject to full corporate-level tax) in a merger or other transaction in which we acquire a basis in the asset determined by reference either to the C corporation’s basis in the asset or to another asset, we will pay tax, at the highest U.S. federal corporate income tax rate, on any built-in gain recognized on a taxable disposition of the asset during the 5-year period after its acquisition. As a result of the manner in which we acquired the Hudye Farm in 2014, a subsequent taxable disposition by us of any such assets generally would be subject to the foregoing built-in gain rules.

In certain circumstances, we may be subject to U.S. federal and state income taxes as a REIT, which would reduce our cash available for distribution to our stockholders.

Even if we qualify as a REIT, we may be subject to U.S. federal income taxes or state taxes. As discussed above, net income from a “prohibited transaction” will be subject to a 100% penalty tax and built-in gain recognized on the taxable disposition of assets acquired from C corporations in certain non-taxable transactions will be subject to tax at the highest applicable U.S. federal corporate income tax rate. To the extent we satisfy the distribution requirements applicable to REITs, but distribute less than 100% or our taxable income, we will be subject to U.S. federal income tax at regular corporate rates on our undistributed income. We may not be able to make sufficient distributions to avoid excise taxes applicable to REITs. We may also decide to retain capital gains we earn from the sale or other disposition of our properties and pay income tax directly on such income. In that event, our stockholders would be treated as if they earned that income and paid the tax on it directly. However, our stockholders that are tax-exempt, such as charities or qualified pension plans, would have no benefit from their deemed payment of such tax liability. We may also be subject to state and local taxes on our income or property, either directly or at the level of the companies through which we indirectly own our assets. Any U.S. federal or state taxes we pay will reduce our cash available for distribution to our stockholders.

The ability of our Board of Directors to revoke or otherwise terminate our REIT qualification without stockholder approval may cause adverse consequences to our stockholders.

Our charter provides that our Board of Directors may revoke or otherwise terminate our REIT election, without the approval of our stockholders, if it determines that it is no longer in our best interest to continue to qualify as a REIT. If we cease to qualify as a REIT, we would become subject to U.S. federal income tax on our taxable income at regular corporate rates and would no longer be required to distribute most of our taxable income to our stockholders, which may have adverse consequences on our total return to our stockholders.

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If our Operating Partnership were classified as a “publicly traded partnership” taxable as a corporation for U.S. federal income tax purposes, we would fail to qualify as a REIT and would suffer other adverse tax consequences.

We intend for our Operating Partnership to be treated as a “partnership” for U.S. federal income tax purposes. If the IRS were to successfully assert our Operating Partnership was “publicly traded,” our Operating Partnership could be taxable as a corporation if less than 90% of its gross income consisted of certain qualifying passive income. In such event, we likely would fail to qualify as a REIT for U.S. federal income tax purposes, and the resulting corporate income tax burden would reduce the amount of distributions that our Operating Partnership could make to us. This would substantially reduce the cash available to pay distributions to our stockholders.

Complying with the REIT requirements may cause us to forego otherwise attractive opportunities or sell properties earlier than we wish.

To maintain our qualification as a REIT for U.S. federal income tax purposes, we must continually satisfy tests concerning, among other things, the sources of our income, the nature and diversification of our assets, the amounts we distribute to our stockholders and the ownership of shares of our stock. We may be required to make distributions to our stockholders at disadvantageous times or when we do not have funds readily available for distribution, or we may be required to forego or liquidate otherwise attractive investments in order to comply with the REIT tests. Thus, compliance with the REIT requirements may hinder our ability to operate solely on the basis of maximizing profits.

You may be restricted from acquiring or transferring certain amounts of our common stock.

Certain provisions of the Code and the stock ownership limits in our charter may inhibit market activity in our capital stock and restrict our business combination opportunities. In order to maintain our qualification as a REIT, five or fewer individuals, as defined in the Code, may not own, beneficially or constructively, more than 50% in value of our issued and outstanding stock at any time during the last half of a taxable year. Attribution rules in the Code determine if any individual or entity beneficially or constructively owns our capital stock under this requirement. Additionally, at least 100 persons must beneficially own our capital stock during at least 335 days of a taxable year. To help ensure that we meet these tests, our charter restricts the acquisition and ownership of shares of our stock.

Our charter, with certain exceptions, authorizes our Board of Directors to take such actions as are necessary and desirable to preserve our qualification as a REIT. Unless exempted by our Board of Directors, our charter prohibits any person from beneficially or constructively owning more than 9.8% in value or number of shares, whichever is more restrictive, of the outstanding shares of any class or series of our capital stock. Our Board of Directors may not grant an exemption from these restrictions to any proposed transferee whose ownership in excess of such ownership limit would result in our failing to qualify as a REIT.

Dividends paid by REITs generally do not qualify for the favorable tax rates available for some dividends.

The maximum U.S. federal income tax rate applicable to qualified dividend income paid to U.S. stockholders that are individuals, trusts and estates currently is 20%. Dividends paid by REITs generally are not eligible for such reduced tax rate. Instead, our ordinary dividends generally are taxed at the higher tax rates applicable to ordinary income, the current maximum rate of which is 37%. Although the favorable tax rates applicable to qualified dividend income do not adversely affect the taxation of REITs or dividends paid by REITs, such favorable tax rates could cause investors who are individuals, trusts and estates to perceive investments in REITs to be relatively less attractive than investments in the stocks of non-REIT corporations that pay dividends, which could adversely affect the value of the shares of REITs, including our common stock. However, for taxable years prior to 2026, individual stockholders are generally allowed to deduct 20% of the aggregate amount of ordinary dividends distributed by us, subject to certain limitations, which would reduce the maximum marginal effective federal income tax rate for individuals on the receipt of such ordinary dividends to 29.6%.

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Changes to the U.S. federal income tax laws, including the enactment of certain tax reform measures, could have an adverse impact on our business and financial results.

In recent years, numerous legislative, judicial and administrative changes have been made to the U.S. federal income tax laws applicable to investments in real estate and REITs. There can be no assurance that future changes to the U.S. federal income tax laws or regulatory changes will not be proposed or enacted that could impact our business and financial results. The REIT rules are regularly under review by persons involved in the legislative process and by the Internal Revenue Service and the U.S. Treasury Department, which may result in revisions to regulations and interpretations in addition to statutory changes. If enacted, certain of such changes could have an adverse impact on our business and financial results.

We cannot predict whether, when or to what extent any new U.S. federal tax laws, regulations, interpretations or rulings will impact the real estate investment industry or REITs. Prospective investors are urged to consult their tax advisors regarding the effect of potential future changes to the federal tax laws on an investment in our shares.

Risks Related to the Market for Our Capital Stock

We may be unable to make distributions at expected levels, which could result in a decrease in the market price of our common stock.

We intend to continue to pay regular quarterly distributions to our stockholders. However, we significantly reduced the amount of distributions on our common stock beginning in the third quarter of 2018, and we may be required to reduce our distributions further in the future. All distributions will be made at the discretion of our Board of Directors and will be based upon, among other factors, our historical and projected results of operations, financial condition, cash flows and liquidity, maintenance of our REIT qualification and other tax considerations, capital expenditure and other expense obligations, debt covenants, contractual prohibitions or other limitations and applicable law and such other matters as our Board of Directors may deem relevant from time to time. If sufficient cash is not available for distribution from our operations, we may have to fund distributions from working capital, borrow to provide funds for such distributions, or reduce the amount of such distributions. To the extent we borrow to fund distributions, our future interest costs would increase, thereby reducing our earnings and cash available for distribution from what they otherwise would have been. If cash available for distribution generated by our assets is less than our current estimate, or if such cash available for distribution decreases in future periods from expected levels, our inability to make the expected distributions could result in a decrease in the market price of our common stock.

Continued increases in market interest rates may have an adverse effect on the market price of our common stock.

One of the factors that investors may consider in deciding whether to buy or sell our common stock is our distribution yield, which is our distribution rate as a percentage of the share price of our common stock, relative to market interest rates. If market interest rates continue to stay elevated or increase further, prospective investors may desire a higher distribution yield on our common stock or may seek securities paying higher dividends or interest. The market price of our common stock is driven partly by the earnings that we derive from rental income with respect to our properties and our related distributions to stockholders, and also from the current market value of the properties themselves. As a result, interest rate fluctuations and capital market conditions are likely to affect the market price of our common stock and such effects could be significant.

The market price and trading volume of our common stock may be highly volatile and low, respectively.

The stock markets, including the New York Stock Exchange (the “NYSE”), on which our common stock is listed, historically have experienced significant price and volume fluctuations. As a result, the market price of our common stock is likely to be similarly volatile, and investors in our common stock may experience a decrease in the value of their shares, including decreases unrelated to our operating performance or prospects. The price of our common stock could be subject

37

to wide fluctuations in response to a number of factors, including those listed in this “Risk Factors” section of this Annual Report on Form 10-K and others such as:

actual or anticipated variations in our quarterly results of operations or dividends;
changes in our funds from operations or earnings estimates;
changes in government regulations or policies affecting our business or the farming business; 
publication of research reports about us or the real estate or farming industries; 
sustained decreases in agricultural commodity and crop prices; 
increases in market interest rates that lead purchasers of our common stock to demand a higher yield;
changes in market valuations of similar companies; 
adverse market reaction to any FVA Amount. See “Risk Factors—additional debt we incur in the future;
additions or departures of key management personnel; 
actions by institutional stockholders; 
speculation in the press or investment community; 
the realization of any of the other risk factors presented in this Annual Report on Form 10-K; 
the extent of investor interest in our securities; 
the general reputation of REITs and the attractiveness of our equity securities in comparison to other equity securities, including securities issued by other real estate-based companies; 
our underlying asset value; 
investor confidence in the stock and bond markets generally; 
changes in tax laws; 
future equity issuances; 
failure to meet earnings estimates; 
failure to meet and maintain REIT qualifications and requirements; 
low trading volume of our common stock; and 
general market and economic conditions, including conditions that are outside of our control, such as the impact of public health and safety concerns.

In the past, securities class action litigation has often been instituted against companies following periods of volatility in the price of their common stock. This type of litigation could result in substantial costs and divert our management's attention and resources, which could have a material adverse effect on us, including our financial condition, results of operations, cash flow and the per share trading price of our common stock.

Our common stock is subject to trading risks created by the spread of false information and manipulative trading.

Our common stock is widely traded and held by a diverse group of investors, including retail investors, and these investors are subject to the influence of information provided by third party investor websites and independent authors distributing information on the internet. This information is often widely distributed, in some cases anonymously, including through platforms that mainly serve as hosts seeking advertising revenue. These sites and internet distribution strategies create opportunities for individuals to pursue both “pump and dump” and “short and distort” strategies. We believe that many of these websites have little or no requirements for authors to have professional qualifications. While these sites sometimes require disclosure of stock positions by authors, as far as we are aware these sites do not audit the accuracy of such conflict of interest disclosures. In addition, we believe that many of these websites have few or lax editorial standards, and thin or non-existent editorial staffs. Despite our best efforts, we may not be able to obtain corrections to information provided on these websites about our Company, and any corrections that are obtained may not be achieved prior to the majority of audience impressions being formed for a given article. These conditions create volatility and risk for holders of our common stock and should be considered by investors. While we have sought to engage regulators to address activities that we believe are intentionally misleading, we can make no guarantees that regulatory authorities will take action on these types of activities, and we cannot guarantee that any action taken by regulators or legislators will timely address damage done by the activities of these websites and authors.

38

The number of shares of our common stock available for future issuance or sale may have adverse effects on the market price of our common stock.

As of December 31, 2023, approximately 48.0 million shares of our common stock were outstanding. In addition, as of December 31, 2023, other than the Common units held by us, approximately 1.2 million Common units in our Operating Partnership were outstanding, 1.2 million of which currently may be tendered for redemption by the holders, for cash, or at our option, for shares of our common stock, on a one-for-one basis. We have registered the issuance of 1.2 million of the shares issuable upon redemption of Common units, and we intend to register the issuance of additional shares that may be issued upon redemption of Common units so that such shares will be freely tradable under the securities laws.

We cannot predict whether future issuances or sales of shares of our common stock or the availability of shares for resale in the open market will decrease the per share trading price per share of our common stock. The per share trading price of our common stock may decline significantly when we register the shares of our common stock issuable upon redemption of outstanding Common units.

Future offerings of debt, which would be senior to our common stock and any outstanding preferred equity securities upon liquidation, which may be senior to our common stock for purposes of dividend distributions or upon liquidation, and Common units in connection with future acquisitions may materially adversely affect us, including the per share trading price of our common stock.

In the future, we may attempt to increase our capital resources by making additional offerings of debt or equity securities (or causing our Operating Partnership to issue debt securities), including medium-term notes, senior or subordinated notes and classes or series of preferred stock. Upon liquidation, holders of our debt securities, shares of preferred stock and lenders with respect to other borrowings will be entitled to receive payments prior to distributions to the holders of our common stock. Additionally, any convertible or exchangeable securities that we issue in the future may have rights, preferences and privileges more favorable than those of our common stock and may result in dilution to owners of our common stock. Holders of our common stock are not entitled to preemptive rights or other protections against dilution. Any future series of preferred stock could have a preference on liquidating distributions and a preference on dividend payments that could limit our ability to pay dividends to the holders of our common stock. Because our decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, we cannot predict or estimate the amount, timing or nature of our future offerings. Thus, our stockholders bear the risk that our future offerings could reduce the per share trading price of our common stock and dilute their interest in us. In addition, the issuance of Common units in connection with future acquisitions and the redemption of such Common units for common stock may be dilutive to our stockholders and could have an adverse effect on the per share trading price of our common stock.

Item 1B. Unresolved Staff Comments

None.

Item 1C. Cybersecurity

The Company assesses cybersecurity risk and exposure on an ongoing basis and implements tools that are commensurate with the risks that the Company faces. In light of the Company’s relatively small size and personnel, it relies heavily on reputable third-party vendors to mitigate key cybersecurity risks and exposures. While the nature of the Company’s business and the data it processes inherently limit the Company’s exposure to cybersecurity risk, the Company has implemented and maintains controls, policies, procedures and safeguards to maintain and protect confidential information as well as the integrity, continuous operation, redundancy and security of all information technology systems and data used in connection with the Company’s business. The Company generally approaches cybersecurity threats through a comprehensive approach, with the specific goals of: (i) identifying, preventing and mitigating cybersecurity threats to the Company; (ii) preserving the confidentiality, security and availability of the information that we collect and store to use in our business; (iii) protecting the Company’s intellectual property; (iv) maintaining the confidence of our customers, clients and business partners; and (v) providing appropriate public disclosure of cybersecurity risks and incidents when required.

39

Risk Management and Strategy

Consistent with overall risk management policies and practices, the Company’s cybersecurity program focuses on the following areas:

Vigilance: The Company employs tools to identify, prevent and mitigate cybersecurity threats and respond to cybersecurity incidents in accordance with our internal cybersecurity policies and controls.
Systems Safeguards: The Company and its third party vendors deploy systems safeguards that are designed to protect the Company’s information systems from cybersecurity threats, including firewalls, intrusion prevention and detection systems, anti-malware functionality and access controls, which are evaluated and improved on an ongoing basis.
Third-Party Risk Management: The Company ensures that all third party vendors that process or have access to sensitive information have appropriate cybersecurity risk controls in place.
Training: The Company communicates regularly with employees to increase awareness around phishing and spoofing attempts and other cybersecurity schemes. Employees are encouraged to report suspicious emails or incidents to the General Counsel or the President and Chief Executive Officer.
Incident Response Policies: The Company has established and maintains incident response policies that address the Company’s response to a cybersecurity incident.
Communication, Coordination and Disclosure: The Company promotes awareness and surveillance over cybersecurity risk at all levels of the organization, including staff, senior management and the Board.

Governance

The Board oversees the management of risks from cybersecurity threats, including the policies, standards, processes and practices that the Company’s management implements to address risks from cybersecurity threats. The Board receives presentations on cybersecurity issues and developments as needed. The Board also will receive prompt and timely information regarding any cybersecurity incident that meets established reporting materiality thresholds, as well as ongoing updates regarding such incident until it has been addressed. The Company evaluates the materiality of a cybersecurity incident based on the overall impact of the event, which depends on a number of factors including, but not limited to, the financial impact of the incident and the type of information involved. At least once each year, the Board discusses the Company’s approach to cybersecurity risk management with the Company’s President and Chief Executive Officer and General Counsel.

The Company’s President and Chief Executive Officer, Luca Fabbri, is the member of the Company’s management that is principally responsible for overseeing the Company’s cybersecurity risk management program and incident reporting, in partnership with other business leaders across the Company. In the event there is a material cybersecurity breach or incident, Mr. Fabbri works in coordination with the Company’s General Counsel, Christine Garrison, to assess and respond, including by reporting this incident to the Board and/or applicable regulatory authorities, as necessary or required. Mr. Fabbri has a high level of exposure to cybersecurity oversight through his current and previous work in the technology sector. Mr. Fabbri has served in various roles in information technology and information security for over 30 years, including serving as a consultant with Elk Creek Ventures Inc. from 2003 to 2012, through which he provided consulting services in technology, and serving as co-founder and vice president of engineering of Co3 Systems Inc., an enterprise software company in the cybersecurity space that is now part of IBM, from 2010 to 2011. Mr. Fabbri also co-founded a software company called HomeSphere, for which he served as senior vice president and chief financial officer from 2000 to 2002, and currently serves on the board of directors of Basil Systems Inc., a healthcare software company. Mr. Fabbri, Ms. Garrison and the Company’s Chief Financial Officer each hold degrees in their respective fields, and each have over 15 years of experience with managing risks at the Company and in environments similar to the Company’s, including risks arising from cybersecurity threats.

40

Mr. Fabbri, in coordination with the Board, works collaboratively across the Company to implement a program designed to protect the Company’s information systems from cybersecurity threats and to promptly respond to any cybersecurity incidents. Mr. Fabbri and Ms. Garrison monitor the prevention, detection, mitigation and remediation of cybersecurity incidents in real time, and report such incidents to the Board and applicable regulatory authorities when appropriate.

The Company has in the past experienced cyberattacks on its computer networks and, although none to date have been material, the Company expects that additional cyberattacks will occur in the future. Cybersecurity threats, including as a result of any previous cybersecurity incidents, have not materially affected and are not reasonably likely to affect the Company, including its business strategy, results of operations, or financial condition.

Item 2. Properties

The information set forth under the caption “Our Properties” in Item 1 of this Annual Report on Form 10-K is incorporated by reference herein.

Item 3. Legal Proceedings

For information regarding legal proceedings as of December 31, 2023, see “Note 8—Commitments and Contingencies” to our Consolidated Financial Statements included in Part IV, Item 8 of this Annual Report on Form 10-K.

Item 4. Mine Safety Disclosures

Not Applicable.

PART II

Item 5. Market For Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

Our common stock trades on the NYSE under the symbol “FPI.”

41

Stock Performance Graph

The following graph compares the total stockholder return of our common stock (assuming reinvestment of dividends) against the cumulative returns of the Standard & Poor’s Corporation Composite 500 Index and the Dow Jones Equity All REIT Index for the past five years. Our common stock began trading on the NYSE on September 8, 2015 and was previously traded on the NYSE MKT following our initial public offering on April 19, 2014.

Graphic

Period Ending

Index

12/31/2018

12/31/2019

12/31/2020

12/31/2021

12/31/2022

12/31/2023

Farmland Partners Inc.

100.00

153.84

203.17

283.83

301.19

313.12

S&P 500 Index

100.00

131.47

155.65

200.29

163.98

207.04

Dow Jones Equity All REIT Index

100.00

128.74

122.57

173.07

129.79

144.46

Distribution Information

Since our initial quarter as a publicly traded REIT, we have made regular quarterly distributions to our stockholders. We intend to continue to declare quarterly distributions, but we cannot provide any assurance as to the amount or timing of future distributions.

Our ability to make distributions in the future will depend upon our actual results of operations and earnings, economic conditions and other factors that could differ materially from our current expectations, including the impact of ongoing litigation. Our actual results of operations will be affected by a number of factors, including the revenue we receive from our properties, our operating expenses, interest expense, the ability of our tenants to meet their obligations and unanticipated expenditures. For more information regarding risk factors that could materially adversely affect our actual results of operations, see “Risk Factors.” Any future distributions will be authorized by our Board of Directors in its sole discretion out of funds legally available therefor and will be dependent upon a number of factors, including restrictions under applicable law, the capital requirements of our Company and the distribution requirements necessary to qualify and maintain our qualification as a REIT. We may be required to fund distributions from working capital or borrow to provide funds for such distributions, or we may choose to make a portion of the required distributions in the form of a taxable stock dividend to preserve our cash balance or reduce our distribution. No distributions can be paid on our common stock

42

unless we have paid all cumulative dividends on our Series A preferred units. The distribution preference of our Series A preferred units could limit our ability to make distributions to the holders of our common stock.

Holders of our Series A preferred units are entitled to receive cash distributions at a rate of 3.00% per annum on the $1,000 liquidation preference of the Series A preferred units, which is payable annually in arrears on January 15 of each year. See “Risk Factors — Certain aspects of our Series A preferred units and Series B Participating Preferred Units may limit our ability to make distributions to our common stockholders.”

In order to maintain qualification as a REIT, we must distribute to our stockholders, on an annual basis, at least 90% of our REIT taxable income, determined without regard to the deduction for dividends paid and excluding net capital gains. In addition, we will be subject to U.S. federal income tax at regular corporate rates to the extent that we distribute less than 100% of our net taxable income (including net capital gains) and will be subject to a 4% nondeductible excise tax on the amount by which our distributions in any calendar year are less than a minimum amount specified under applicable U.S. federal income tax laws. We intend to distribute our net income to our stockholders in a manner intended to satisfy the REIT 90% distribution requirement and to avoid any U.S. federal income tax liability on our income and the 4% nondeductible excise tax. We anticipate that our estimated cash available for distribution will exceed the annual distribution requirements applicable to REITs. However, under some circumstances, we may be required to use cash reserves, incur debt or liquidate assets at rates or times that we regard as unfavorable or make a taxable distribution of our shares in order to satisfy the REIT 90% distribution requirement and to avoid U.S. federal income tax and the 4% nondeductible excise tax.

We anticipate that, from time to time, our distributions will exceed our then current and accumulated earnings and profits for the relevant taxable year, as determined for U.S. federal income tax purposes, due to non-cash expenses such as certain stock-based compensation and depreciation and amortization. Therefore, a portion of our distributions may represent a return of capital for U.S. federal income tax purposes. The extent to which our distributions exceed our current and accumulated earnings and profits may vary substantially from year to year. To the extent a distribution is treated as a return of capital for U.S. federal income tax purposes, it will reduce a stockholder's adjusted tax basis in the holder's shares and, to the extent it exceeds the holder's adjusted tax basis, will be treated as gain resulting from a sale or exchange of such shares. As a result, the gain (or loss) recognized on a sale of that common stock or upon our liquidation would be increased (or decreased) accordingly.

Stockholder Information

As of March 15, 2021,February 23, 2024, there were approximately 4453 direct holders of record of our common stock. However, because many shares of our common stock are held by brokers and other institutions on behalf of stockholders, we believe there are substantially more beneficial holders of our common stock than record holders. As of March 15, 2021,February 23, 2024, there were approximately 1211 holders (other than our company and management)Company) of our Common units. Our Common units are redeemable for cash or, at our election, for shares of our common stock, on a one-for-one basis. As of March 15, 2021,February 23, 2024, there were sixfive holders of our Series A preferred units. As of March 15, 2021, there was one holder of record of our Series B Participating Preferred Stock. However, because many shares of our Series B Participating Preferred Stock are held by brokers and other institutions on behalf of stockholders, we believe there are substantially more beneficial holders of our Series B Participating Preferred Stock than record holders.

40

Issuer Purchases of Equity Securities

Share Repurchase Program

On March 15, 2017, our Board of Directors approved a program to repurchase up to $25$25.0 million in shares of our common stock. Repurchases under this program may be made from time to time, in amounts and prices as we deem appropriate. Repurchases may be made in open market or privately negotiated transactions in compliance with Rule 10b-18 under the Exchange Act, subject to market conditions, applicable legal requirements, trading restrictions under our insider trading policy and other relevant factors. In November 2017, our Board of Directors approved repurchases of our Series B participating preferred stock from time to time under the share repurchase program. This share repurchase program does not obligate us to acquire any particular amount of common stock or Series B participating preferred stock, and it may be modified or suspended at any time at our discretion. We expect to fund repurchases under the program using cash on our balance sheet. Our repurchase activity for the three months ended December 31, 2020 under the share repurchase program is presented in the following table. On August 1, 2018, our Board of Directors increased the authority under the share repurchase program to $38.5 million. On November 7, 2019, the Board of Directors approved an additional $50 million under the share repurchase program. On May 3, 2023, our Board of Directors approved a $75.0 million increase resulting in total availability under the share repurchase program of approximately $88.0 million as of such date. On

43

November 1, 2023, our Board of Directors approved a $40.0 million increase in the total authorization available under the program, increasing the total availability under the share repurchase program to approximately $85.0 million as of such date. Our repurchase activity for the three months ended December 31, 2023 under the share repurchase program is presented in the following table. As of the date of this report,December 31, 2023, we had $41.1$83.3 million of availability under the program.

Total Number

Approximate

of Shares

Dollar Value of

Purchased as

Shares that May

Part of

Yet Be

Total

Publically

Purchased

Total

Average

Preferred

Announced

Under the Share

Common Shares

Price Paid

Shares

Average Price

Plans or

Repurchase

(in thousands except per share amounts)

    

Purchased

    

per Share

Repurchased

Paid Per Share

    

Programs

    

Program

    

Total Number of Common Shares Purchased ¹

    

Average Price Paid per Share

    

Total Number of Preferred Shares Purchased

    

Average Price Paid per Share

    

Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs

    

Approximate Dollar Value of Shares that May Yet be Purchased Under the Share Repurchase Program

October

$

$

$

41,357

November

30

$

8.37

$

30

41,106

December

$

$

41,106

October 1, 2023 - October 31, 2023

152

$

10.28

$

152

$

45,459

November 1, 2023 - November 30, 2023

186

11.72

185

83,283

December 1, 2023 - December 31, 2023

83,283

Total

30

$

8.37

$

30

$

41,106

338

$

11.07

$

337

⁽¹⁾  The total number of shares purchased includes shares of our common stock transferred to us in order to satisfy tax withholding obligations incurred upon the vesting of restricted stock awards held by our employees.

From January 1, 2021 through the date of this report, the CompanySubsequent to December 31, 2023, we did not repurchase any shares of common or preferred stock.

Item 6. [Reserved]

Item 6. Selected Financial Data

Not applicable.

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Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following analysis of our financial condition and results of operations should be read in conjunction with ourthe consolidated financial statements and the notes thereto containedincluded elsewhere in this Annual Report on Form 10-K.

Overview and Background

We are an internally managed real estate company that ownsOur primary strategic objective is to utilize our position as a leading institutional acquirer, owner and seeks to acquiremanager of high-quality farmland located in agricultural markets throughout North America.America to deliver strong risk adjusted returns to investors through a combination of cash dividends and asset appreciation. As of the date of this Annual Report on Form 10-K,December 31, 2023, we ownowned farms with an aggregate of approximately 150,000132,800 acres in Alabama, Arkansas, California, Colorado, Florida, Georgia, Illinois, Indiana, Kansas, Louisiana, Michigan, Mississippi, Missouri, Nebraska, North Carolina, Oklahoma, South Carolina South Dakota, and Virginia.Texas. In addition, as of December 31, 2023, we owned land and buildings for four agriculture equipment dealerships in Ohio leased to Ag Pro under the John Deere brand and served as property manager for approximately 38,300 acres, including farms in Iowa. As of the date of this Annual Report on Form 10-K,December 31, 2023, approximately 70% of our portfolio (by value) iswas used to grow primary crops, such as corn, soybeans, wheat, rice and cotton, with the balanceand approximately 30% was used to produce specialty crops, such as almonds, citrus, blueberries, vegetables, citrus, nuts and edible beans.vegetables. We believe our portfolio gives investors exposure to the economic benefit of increasing global food demand trend in the face of growing scarcity of high qualityhigh-quality farmland and will continue to reflect the approximate breakdownallocation of U.S. agricultural output between primary crops and animal protein (whose production relies principally on primary crops as feed), on one hand, and specialty crops, on the other. 

In addition, under the FPI Loan Program, we make loans to third-party farmers (both tenant and non-tenant) to provide financing for property acquisitions, working capital requirements, and operational farming activities, farming infrastructure projects and for other farming and agricultural real estate related purposes. As of the first quarter of 2021 we are also engaged in farmland asset management on behalf of third parties.projects.

We wereFPI was incorporated in Maryland on September 27, 2013, and we areis the sole member of the sole general partner of the Operating Partnership, which is a Delaware limited partnership that was formed on September 27, 2013. All of ourFPI’s assets are held by, and ourits operations are primarily conducted through, the Operating Partnership and its wholly owned subsidiaries. As of the date of this Annual Report on Form 10-K we own 95.4%December 31, 2023, FPI owned 97.6% of the Class A Common units of limited partnership interest in the Operating Partnership (“Common units”), and none of the Series A preferred units of limited partnership interestunits. See “Note 9—Stockholders’ Equity and Non-controlling Interests” within the notes to the consolidated financial statements included in this Annual Report on Form 10-K for additional information regarding the Operating Partnership (“Series A preferred units”) or shares of our 6.00% Series B Participating Preferred Stock (the “Series B Participating Preferred Stock”).non-controlling interests.

As of December 31, 2020, we owned 94.9% of the Common units in the Operating Partnership.

WeFPI has elected and qualified to be taxed as a REIT for U.S. federal income tax purposesunder Sections 856 through 860 of the Internal Revenue Code of 1986, as amended, commencing with ourits short taxable year ended December 31, 2014.

Recent Developments

2020 Completed Acquisitions and2023 Dispositions

During 2020,2023, we completed three asset acquisitions. Aggregate consideration for the three acquisitions totaled $1.4 million and consisted of cash and reduction of notes receivable. No intangible assets were acquired through these acquisitions. We also completed seven dispositions consisting of eleven farms for total74 properties in the Corn Belt, Delta and South, High Plains, Southeast and West Coast regions. We received $195.5 million in aggregate consideration, including $11.8 million in seller financing, and recognized an aggregate gain on sale of $20.5 million for a total$36.1 million. In connection with the foregoing seller-financed transactions, we deferred an additional net gain over net book valueon sale of $3.2 million, or 15.6%.$2.1 million.  The deferred gain will be recognized at such time as we consider collection of the seller-financed portion of the sale price to be probable under applicable accounting standards.

StockShare Repurchases

During 2020,the year ended December 31, 2023, we repurchased an aggregate6,551,087 shares of 1,034,167 shares ofour common stock at a weighted average price of $11.00 per shareshare. As of $6.59December 31, 2023, the Company had approximately $83.3 million of capacity remaining under the stock repurchase plan. In addition, the Company redeemed 34,000 Common units in exchange for a total costcash of $6.8 million and aggregate of 140,189 shares of Series B preferred stock at a weighted average price per share of $22.08 for a total cost of $3.1approximately $0.4 million.

Opportunity Zone Agreement

On January 20, 2021, we entered into an agreement with Promised Land Opportunity Zone Farms I, LLC (the “OZ Fund”) to sell, throughout 2020, twelve farms located in opportunity zones as designated by the Tax Cuts and Jobs Act of

4245

2017,Deleveraging and Maintained Liquidity Position

During the year ended December 31, 2023, we reduced our overall indebtedness by $76.4 million, largely with proceeds from the asset dispositions described above, resulting in an increase in liquidity.

As of December 31, 2023, we had access to provideliquidity of $206.6 million, consisting of $5.5 million in cash and $201.1 million in undrawn availability under our credit facilities with Federal Agricultural Mortgage Corporation and its wholly owned subsidiary, Farmer Mac Mortgage Securities Corporation (collectively, “Farmer Mac”), Metropolitan Life Insurance Company (“MetLife”), and Rutledge Investment Company (“Rutledge”) compared to cash of $7.7 million and $169.0 million in undrawn availability under our credit facilities as of December 31, 2022. For more information on our deleveraging efforts and liquidity please see “Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources”.

Lease Renewals

During the year ended December 31, 2023, we renewed fixed cash farm management services on the farms for the Promised Land Opportunity Zone Farmsleases expiring in exchange for management fees going forward.2023 at average rent increases of approximately 20%.

Impact of COVID-19 on Our Businessthe War in Ukraine

AsFood prices were near record highs even before the vaccine forinvasion of Ukraine. Ukraine and the coronavirus (“COVID-19”) is beginning to be widely distributed among the population most at risk, we are gainingRussian Federation represent large portions of global trade in a better understandingvariety of the impactagricultural products (e.g., 34% of the COVID-19 pandemic on our business, particularly with regardglobal wheat exports, according to the 2020 crop marketing cycle. We expectInternational Food Policy Research Institute). The disruption in farming operations in Ukraine, and trade from the impactBlack Sea region has stressed the food supply for many countries that depend on imports of agricultural products from the COVID-19 pandemic to lessen in the 2021 crop marketing cycle. However, we are unable to fully quantify what the ultimate impact of the pandemic on our business will be, as there are still significant uncertainties around the social and economic impact of the pandemic, and the size and timing of additional economic relief measures.

So far, the pandemic has significantly affected only certain sectors of the U.S. agricultural industry,region, such as fresh food production marketed to the hospitality industry, and meat packing. In particular, we have experienced a decrease in demand – and therefore price – for lemons and blueberries, among other crops. Related revenue declines have had a transient yet significant impact on our profitability. Other permanent crops in our farm portfolio – almonds in particular – have suffered in 2020 due to a mix of the COVID-19 pandemic and trade war related disruptions, which caused a combination of price weakness and longer sales cycles. Lower gasoline demand has affected demand for ethanol and therefore corn, however the negative impact on commodity prices was offset by a recent tightening of supply. We expect that the impact of the COVID-19 pandemic on our profitability will be temporary, but not necessarily limited to 2020; for example, we do not expect that the demand from the bar and restaurant trade will approach pre-pandemic levels until mid- to late-2021 at the earliest.

Despite short and medium-term disruptions in the U.S. agricultural industry, we do not expect global demandEgypt (wheat for food feed, fuelproducts) and fiber to be materially affected by the COVID-19 pandemic and the related economic turmoil. We expect the industry to experience some degree of long term transformation, but to survive relatively unscathed compared to other industries. As of the date of this Annual Report, farm values have largely held, and probably increased portfolio-wide, throughout the pandemic. As owners of essential long-term assets in an essential industry, we also expect our business to perform relatively well, although the demand and pricing disruption in selected specialty crops that we have seen so far might not be the only negative impact of the pandemic on our business. We expect certain farmers’ profitability to be impacted, however a combination of the high quality of our tenant base and the financial support measures implemented by the U.S. federal government should prevent a material degradation in our tenants’ creditworthiness. So far, the impact of the pandemic on our financial performance has been largely limited to our exposure to the pricing of certain permanent crops through participating leases and direct operation of farms, as our tenants have been able to maintain their financial commitments.China (corn for livestock).

The directRussian Federation is also a major exporter of fertilizers and trade restrictions have hampered the flow of fertilizers to countries dependent on imports from the Black Sea region. United States farmers, including our tenants, however, generally source fertilizers from the United States and Canada.

We anticipate that U.S. farmers will continue to be an important contributor to global food imports as Russia continues its aggression against Ukraine, and high demand for primary crops, which are the core of our business, together with high commodity prices, will sustain high levels of profitability for U.S. farmers. We can provide no assurances as to whether this anticipated increase in profitability will have an impact on rental rates in the regions in which we operate.

Inflation and Interest Rates

Most of our farming leases have lease terms of three years for row crops and up to seven years for permanent crops, pursuant to which each tenant is responsible for substantially all of the COVID-19 pandemic on our operations has been limited as ofoperating expenses related to the date of this Annual Report. Even though we operate in an essential industryproperty, including maintenance, water usage and therefore have been largely exempted from stay-at-home orders, we have prioritized the health and well-being of our employees. We asked our office staff to work from home whenever possible even before the City and County of Denver and the State of Colorado implemented stay-at-home orders. Our technology infrastructure was already well suited to remote working conditions, and the layout of our offices allows us to substantially observe social distancing guidelines when staff need to be present in the office. We have asked our field personnel to limit travel to only those trips required to monitor and maintain the farms we already own, and to substantially lessen direct contact with our tenants and suppliers.insurance. As a result, we believe that the effect on us of these worker health measures,inflationary increases in operating expenses are borne largely by our tenants under the terms of their leases. We believe that inflationary increases in farmer profitability will continue to impact lease renegotiations upon renewals, as we have experienced a perceptible degradationseen in operating efficiency, but not to such an extent as to materially affect our financial results or internal controls. Asthe most recent renewal cycle in late 2023. Furthermore, high levels of inflation have prompted the Board of Governors of the first quarter of 2021, both in-person office attendanceFederal Reserve to increase the Federal Reserve’s discount rate, which has led to a significant increase in market short- and frequency of travel have increased as compared tolong-term interest rates since the beginning of 2022. This increase in rates has significantly increased the pandemic,cost of our floating rate debt and are expected to return to pre-pandemic levels later inhas also significantly increased the year. We do not expectcost of certain of our MetLife debt with interest rates that have been reset since the pandemic will have a material impact on our business and operations going forward, especially as broader segmentsbeginning of 2022. The Federal Reserve may continue this policy of maintaining elevated rates, which would further increase interest expense for many businesses, including the U.S. population are becoming eligible to be vaccinated.Company.

Factors That May Influence Future Results of Operations and Farmland Values

The principal factors affecting our operating results and the value of our farmland include long-term global demand for food relative to the global supply of food,food; farmland fundamentals and economic conditions in the markets in which we own

43

farmland, farmland; and our ability to increase or maintain rental revenues while controlling expenses. We are currently in an

46

environment of appreciating land values, driven by, among other things, inflation, strong commodity prices (further exacerbated by the war in Ukraine) and an outlook for high levels of farmer profitability. Sustained high interest rates can serve as a counter-balancing external factor to this favorable environment. Each year additional farmland in various portions of the world, including the United States, is repurposed for commercial development, thus decreasing the land acreage available for production of grains, oil seeds, permanent and specialty crops necessary to feed the world’s growing population. Although farmland prices may show a decline from time to time, we believe that any reduction in U.S. farmland values overall is likely to be short-lived as global demand for food and agricultural commodities typically exceeds global supply. In addition, although prices for many crops experienced significant declines in 2014supply and 2015, in late 2020 and early 2021 they have rebounded to or near prior highs, driven by increased demand expectations from China and modest weather issues around the world. We believe that the combination of long-term growth trends in global population and GDP per capita and steadily increasing yields will result in stable or increased prices and increased revenue per acre for primary crops over time.quality farmland becomes scarcer.

Food Demand

Notwithstanding any impacts from the ongoing COVID-19 pandemic, weWe expect that global demand for food, driven primarily by significant increases in the gross domestic product (“GDP”) per capita and global population, and GDP per capita, will continue to be the key driver of farmland values. We further expect that global demand for most crops will continue to grow to keep pace with global population growth, which we anticipate will lead to either higher prices and/or higher yields and, therefore, higher rental rates on our farmland, as well as sustained growth in farmland values over the long term.growth. We also believe that growth in global GDP per capita, particularly in developing nations, will contribute significantly to increasing demand for primary crops. As global GDP per capita increases, the composition of daily caloric intake is expected to shift away from the direct consumption of primary crops toward more fruits, vegetables and animal-based proteins, which is expected to result in increased demand for primary crops as feed for livestock. According to the United Nations’ Food and Agriculture Organization (“UN FAO”), these factors are expected to require more than one billion additional tons of global annual grain production by 2050, a 43% increase from 2005-2007 levels and more than two times the 446 million tons of grain produced in the United States in 2014.  Furthermore, weWe believe that, as GDP per capita grows, a significant portion of additional household income is allocated to food and that once individuals increase consumption of and spending on, higher quality food, they will strongly resist returning to their former dietary habits, resulting in greater inelasticity in the demand for food. As a result, we believe that, as global demand for food increases,We anticipate these factors will lead to either higher crop prices and/or higher yields and, therefore, higher rental rates on our farmland, and the value of ouras well as sustained growth in farmland will increasevalues over the long term. Global

In addition, global demand for corn and soybeans as inputs in the production of biofuels such as ethanol and soysoy-based diesel also could impact the prices of corn and soybeans, which, in the long term, could impact our rental revenues and our results of operations. However, the success of our long-term business strategy is not dependent on growth in demand for biofuels, and we do not believe that demand for corn and soybeans as inputs in the production of biofuels will materially impact our results of operations or the value of our farmland, primarily because we believe that growth in global population and GDP per capita and global population will be more significant drivers of global demand for primary crops over the long term.

Despite advances in income, according to “The State of Food Security and Nutrition in the World 2023,” a report by the UN FAO, 2.4 billion people were facing moderate to severe food insecurity in 2022. The ongoing war in Ukraine has disrupted supply chains and affected the prices of grain, fertilizer, and energy, further stressing food supplies for developing countries that are dependent on food imports.

Farmland Supply

Global supply of agricultural commodities is drivenAccording to the World Bank Group arable land per capita has decreased by two primary factors,approximately 50% from 1961 to 2021, further exacerbated by international conflicts, such as the number of tillable acres available for crop production and the productivity of the acres being farmed. Although the amount of global croplandongoing war in use has gradually increased over time, growth has plateaued over the last 20 years.Ukraine. Typically, additions to cropland are in areas of marginal productivity, while cropland loss, driven by urban development, tends to affect primarily highly productive areas. Cropland area continues to increase in developing countries, but after accounting for expected continuing cropland loss, the UN FAO projects only 173 million acres will be added from 2005-2007 to 2050, an approximate 5% increase. In comparison, world population is expected to grow over the same period to 9.1 billion, a nearly 40% increase. According to the World Bank Group, arable land per capita has decreased by approximately 50% from 1961 to 2015. While we expect growth in the global supply of arable land, we also expect that landowners will only put that land into production if increases in commodity prices and the value of farmland cause landowners to benefit economically from using the land for farming rather than alternative uses. We also believe that decreases in the amount of arable land in the United States and globally as a result of increasing urbanization will partially offset the impact of additional supply of farmland. Additionally, we believe that farmland lost to urban development disproportionately impacts higher quality farmland. According to a study published in 2017 in the Proceedings of the National Academy of Sciences, urban expansion is expected to take place on cropland that is 1.77 times more productive than the global average.Theaverage. The global supply of food is also impacted by the productivity per acre of tillablearable land. Historically, productivity gains (measured by average crop yields) have been driven by advances in seed technology, farm equipment, irrigation techniques, and improvements in soil health, chemical nutrients and chemical fertilizers and pesticides. Furthermore,pest control. On the other hand, we expect the increasing shortage of water in many irrigated growing regions in the United States and other growing regions around the globe, often as a result of new water restrictions

44

imposed by laws or regulations, to lead to decreased productivity growth on many acres and, in some cases, cause yields to decline on those acres.

Conditions in Our Existing Markets

Our portfolio spansis broadly diversified across numerous farmland markets and crop types, which provides us broad diversification across conditions in these markets.types. Across all regions, farmland acquisitions continue to be dominated by buyers who are existing farm owners and operators;operators, whereas institutional and investor acquirors remaininvestors constitute a small fraction of the industry.industry (less than 5% of total farmland in the United States). We generally see firm demand for high quality properties across all regions and crop types.

Farmland values are typically very stable, often showing modest increases even in years of commodity price weakness. We expect this trend to continue, with modest but consistent annual increases compoundingthat compound into significant appreciation

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in the long termterm. Under certain market conditions, as in 2021, 2022 and 2023, with strong commodity prices and farmer profitability, there are periods of accelerating appreciation in farmland values. Leases renegotiated under the robust market conditions experienced in 2021, 2022, and 2023 reflected significant rent increases. While the pace of appreciation and transaction volume slowed in 2023, these metrics remain strong relative to long-term trends.

With regard to leasing dynamics, weWe believe quality farmland in the United States has a near-zero vacancy rate as a result of the supply and demand fundamentals discussed above. We believe that due to the relatively high fixed costs associated with farming operations (including equipment, labor and knowledge), many farm operators choose to rent additional acres of farmland when it becomes available in order to allocate their fixed costs over additional acres. Our view is that rental rates for farmland are a function of farmland operators’ view of the long-term profitability of farmland, and that many farm operators will compete for farmland even during periods of decreased profitability due to the scarcity of farmland available to rent. In particular, we believe that due to the relatively high fixed costs associated with farming operations (including equipment, labor and knowledge), many farm operators in some circumstances will rent additional acres of farmland when it becomes available in order to allocate their fixed costs over additional acres. Furthermore, because it is generally customary in the industry to provide the existing tenant with the opportunity to re-lease the land at the end of each lease term, we believe that many farm operators will rent additional land that becomes available in order to control the ability to farm that land in future periods. As a result, in our experience, many farm operators will aggressively pursue rental opportunities in their operable geographic area, even when the farmer anticipates lower currentprofits returns or even short-term losses.

In our primary row crop farmland, we see modestly higher rent rates in connection with 2021 lease renewals, and we expect to continue seeing rent growth into 2022. This is consistent with robust prices in primary crop markets and tenant demand for leasing high quality farmland. Across specialty crops, operator profitability is under some pressure. Participating lease structures are common in many specialty crops, and base lease rates are consistent with or somewhat lower than 2020.  

Lease Expirations

Farm leases are often short-termgenerally one to three years in nature among row crop farms, and longer term in nature among permanent crop farms in our portfolio.duration. As of December 31, 2020,2023, our portfolio had the following lease expirations as a percentage of approximate acres leased and annualizedannual minimum cashfixed rents:

    

    

    

    

 

% of

% of

($ in thousands)

Approximate

Approximate

Annual

Annual

Year Ending December 31,

    

Acres

    

Acres

    

    

Cash Rents

    

Cash Rents

2021

 

46,695

33.9

%  

$

10,780

40.5

%

2022

32,554

23.6

%  

7,249

27.2

%

2023

 

33,024

23.9

%  

5,236

19.7

%

2024

 

9,038

6.6

%  

736

2.8

%

2025

8,502

6.1

%  

885

3.3

%

2026 and beyond

8,126

5.9

%  

1,716

6.5

%

 

137,939

100.0

%  

$

26,602

100.0

%

As of the date of this report, 1,862 total acres are unleased and we are currently negotiating leases for all of them.

($ in thousands)

 

Year Ending December 31,

    

Approximate Acres

    

% of Approximate
Acres

    

Annual Fixed
Rents

    

% of Annual
Fixed Rents

 

2024

38,961

29.3

%  

$

12,017

 

36.1

%

2025

 

28,066

21.1

%  

7,124

 

21.4

%

2026

 

32,625

24.6

%  

6,432

 

19.3

%

2027

19,519

14.7

%  

4,751

 

14.3

%

2028

143

0.1

%  

59

0.2

%

Thereafter

13,485

10.2

%  

2,888

8.7

%

 

132,799

100.0

%  

$

33,271

100.0

%

Rental Revenues

Our revenues are primarily generated from renting farmland to operators of farming businesses. Our leases generally have terms ranging from one to 25three years, with three being the most common.some extending up to 40 years (e.g., renewable energy leases). Although the majority of our leases do not provide the tenant with a contractual right to renew the lease upon its expiration, we believe it is customary to provide the existing

45

tenant with the opportunity to renew the lease, subject to any increase in the rental rate that we may establish. If the tenant elects not to renew the lease at the end of the lease term, the land will be offered to a new tenant. As discussed above, the vacancy rate for quality U.S. farmland is near-zero and there is often competition among prospective tenants for quality farmland; accordingly, we do not believe that re-leasing farmland upon the expiration of existing leases is a significant risk for the Company.

The leases for the majority of the row-crop properties in our portfolio provide that tenants must pay us, at leasttypically, 50% of the annualtheir fixed farm rent in advance of each spring planting season. As a result, we collect a significant portion of total annual rents in the first calendar quarter of each year.  Weyear, which we believe our use of leases pursuant to which at least 50% of the annual rent is payable in advance of each spring planting season mitigates the tenant credit risk associated with the variability of farming operations that could be adversely impacted by poor crop yields, weather conditions, mismanagement, undercapitalization or other factors affecting our tenants. Tenant credit risk is further mitigated by requiring thatthe farming industry practice of purchasing crop insurance in almost every circumstance because it is required by lenders who provide working capital financing to our tenants maintain crop insurance and bydue to requirements in our claim on a portion ofleases. In certain cases, the related proceeds, if any, as well as by ourCompany perfects its security interest in the crop insurance proceeds and the underlying growing crop.crops using practices applicable in the state where the farm is located. Prior to acquiring farmland property, we take into consideration the competitiveness of the local farm-operator tenant environment in order to enhance our ability to quickly replace a tenant that is unwilling to renew a lease or is unable to pay a rent payment when it is due. SomeMany of our leases provide for athe reimbursement by the tenant of the propertyproperty’s real estate taxes that we pay.

As described above, we are assessingpay in connection with the impact, if any, on our ability to collectfarms they rent from our tenants as a resultus.

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Expenses

Substantially all of our farm leases are structured in such a way that we are responsible for major maintenance expenses, certain liability and casualty insurance and taxes (which are sometimes reimbursed to us by our tenants), while our tenant is responsible for operating expenses, minor maintenance, water usage and all of the additional input costs related to farming operations on the property, such as seed, fertilizer, labor and fuel. We expect that substantially all of the leases for farmland we acquire in the future will continuecontain similar features related to be structured in a manner consistent with substantially all of our existing leases.expenses. As the owner of the land, we generally only bear costs related to major capital improvements permanently attached to the property, such as irrigation systems, drainage tile, grain storage facilities, permanent plantings or other physical structures customary for farms. In cases where capital expenditures are necessary, we typically seek to offset, over a period of multiple years, the costs of such capital expenditures by increasing rental rates. We also incur the costs associated with maintaining liability and casualty insurance.

We incur costs associated with running a public company, including, among others, costs associated with employing our personnel, Board of Directors, compliance, legal and compliance costs. We incur costs associated withaccounting, due diligence and acquisitions including,(including, among others, travel expenses and consulting fees, and legal and accounting fees. fees). Inflation in personnel costs, which is impacting many United States businesses, is also likely to impact our expenses.

We also incur costs associated with managing our farmland.farmland assets. The management of our farmland, generally, is not labor or capital intensive becausehas significant economies of scale, as farmland generally has minimal physical structures that require routine inspection and maintenance, and our leases, generally, are structured to require the tenant to pay many of the costsoperating expenses associated with the property. Furthermore, we believe that our platform is scalable, and weWe do not expect the expenses associated with managing our portfolio of farmland to increase significantly as the number of farm properties we own increases over time.

Crop Prices

WeWhile many people assume that short-term crop prices have a great impact on farm values, we believe short-termthat long-term farmer profitability and revenue per acre, expressed as crop prices multiplied by crop yield, is a much more significant driver of farm value. Crop yield trends in corn and soybeans have been steadily increasing over the last thirty years. After yields for the 2022/2023 marketing year (September 2022 to August 2023) decreased slightly for both corn and soybeans compared to the previous year, the U.S. Department of Agriculture projects yields to increase slightly for the 2023/2024 marketing year (September 2023 to August 2024). Short-term crop price changes have had little effect historically on farmland values. They also have a limited impact on our rental revenue, as most of our leases provide for a fixed cash rental rate,farm rents, a common approach in agricultural markets, especially with respect to row crops, for several reasons.  This approach recognizes that the value of leased land to a tenant is more closely linked to the total revenue produced on the property, which is driven by crop yield and crop price. This approachcrops. Fixed farm rent significantly simplifies the administrative requirements for the landlord and the tenant, significantly. This approach supports the tenants’ desire to maintain access to their leased farms, which are in short supply, a concept expanded upon below, by providing the landlord consistent rents. Crop price exposure is also limited because tenants alsoas farmers benefit from the fundamental revenue hedging that occurs when large crop yields mitigate the effect of lower crop prices. Similarly, lower crop yields have a tendency to trigger higher crop prices and help increase revenue even when confronted by lower crop yields. Such hedging effect also limits the impact of short-term crop price changes on revenues generated by leases with a bonusvariable rent component based on farm revenues. Further risk mitigation is available to tenants, and indirectly to us, via crop insurance and hedging programs implemented by tenants. Our TRS also takes advantage of these risk mitigation programs and strategies.

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We believe quality farmland in the United States has a near-zero vacancy rate as a result of supply and demand fundamentals. Our view is that rental rates for farmland are a function of farmland operators’ view of the long-term profitability of farmland and that many farm operators will compete for farmland even during periods of decreased profitability duestrategies with respect to the scarcity of farmland available to rent. In particular, we believe that due to the relatively high fixed costs associated with farming operations (including equipment, labor and knowledge), many farm operators in some circumstances will rent additional acres of farmland when they become available in order to allocate their fixed costs over additional acres. Furthermore, becauseproperties it is generally customary in the industry to provide the existing tenant with the opportunity to re-lease the land at the end of each lease term, we believe that many farm operators will rent additional land that becomes available in order to control the ability to farm that land in future periods. As a result, in our experience, many farm operators will aggressively pursue rental opportunities in their operable geography, even when the farmer anticipates lower current returns or short-term losses.directly operates.

The value of a crop is

Crop prices are affected by many factors that can differ on a yearly basis. Weather conditions and crop diseases in major crop production regions worldwidecan create a significant risk of price volatility, which may either increase or decrease the value of the crops that our tenants produce each year. Other material factors adding to the volatility of crop prices are changesvolatility. Changes in government regulations and policy, fluctuations in global prosperity, fluctuations in foreign trade and export markets and eruptions of military conflicts, such as the war in Ukraine, or civil unrest. In addition, although prices for many crops experienced significant declines in 2014 and 2015, in late 2020 and early 2021 they have rebounded to or near prior highs, driven by increased demand expectations from China and modest weather issues around the world. We expect that continued long-term growth trends in global population and GDP per capita will result in increased revenue per acre for primary crops over time. Furthermore, the COVID-19 pandemic has impacted certain specialty crops. We do not believe such declines represent a trend over the long term, but rather a reaction to the decline in economic activity as a result of the pandemic. We expect pricing across specialty crops to strengthen in 2021 as economic disruptions due to the COVID-19 pandemic gradually abate. Although annual rental payments under the majority of our leases are not based expressly on the quality or profitability of our tenants’ harvests, any of these factors could adversely affect our tenants’ ability to meet their obligations to us and our ability to lease or re-lease properties on favorable terms.unrest also impact crop prices.

Interest Rates

The Federal Reserve has engaged in a series of significant increases in the discount rate, which is the rate the Federal Reserve charges member banks for overnight funds. These increases affect all borrowing rates, and for variable rate debt and debt with rates that reset periodically, such increases have a direct and relatively immediate impact.

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As of December 31, 2023, $136.0 million of our outstanding indebtedness was subject to interest rates that reset before maturity (excluding our floating rate debt), of which $43.9 million was subject to interest rates that will be reset in 2024. As of December 31, 2023, the weighted average interest rate of the indebtedness subject to interest rate resets in 2024 was 3.07%.

At December 31, 2023, $80.5 million, or 22.2%, of our debt had variable interest rates, however, as stated in “Note 10—Hedge Accounting” to the accompanying consolidated financial statements, the Company has an interest rate swap with Rabobank for $33.2 million, which reduces floating rate exposure to $47.3 million. After adjusting the $33.2 million of swapped Rabobank debt as fixed rate debt, the ratio of floating rate debt to total debt decreased to 13.0%. Assuming no increase in the level of our variable rate debt spreads, if SOFR increased by 1.0%, our cash flow would decrease by approximately $0.5 million per year, and if SOFR decreased by 1.0%, our cash flow would increase approximately $0.5 million per year.

We expect that future changes in interest rates will impact our overall operating performance by, among other things, affecting our borrowing costs.costs and borrowing costs of our tenants. While we may seek to manage our exposure to future changes in rates through interest rate swap agreements or interest rate caps, portions of our overall outstanding debt will likely remain at floating rates.rates or subject to interest rates that reset periodically. In addition, a sustained material increase in interest rates may cause farmland prices to decline if the rise in real interest rates (which is defined as nominal(nominal interest rates minus the inflation rate) is not accompanied by rises in the general levels of inflation. However, our business model anticipates that over time the value of our farmland will increase, as it has in the past, at a rate that is equal to or greater than the rate of inflation, which may in part offset the impact of rising interest rates on the value of our farmland, but there can be no guarantee that this appreciation will occur to the extent that we anticipate or at all.

International Trade

FollowingAfter a 33% decrease in exports of corn for the trade tensions between China and2022/2023 marketing year (September 2022 to August 2023), the U.S. that started developingUSDA estimates corn exports will be up 26% for the 2023/2024 marketing year (September 2023 to August 2024). After a 7% decrease in 2018,exports of soybeans for the two countries reached a "Phase 1" trade deal in late 2019. At this point, we believe that China and2022/2023 marketing year, the U.S.USDA estimates soybean exports will endeavorbe down 12% for the 2023/2024 marketing year, due to largely comply with the Phase 1 trade deal, leading to increased purchases by China of many U.S. agricultural exports. While logistical disruptions introduced by the COVID-19 pandemic have slowed China’s compliance with its Phase 1 commitments, U.S. agricultural exports to China have been supported by a combination of tighter global supplies of agricultural commodities and an increase in demand to replenish China’s strategic reserves.lower production.

Trade tensions have impacted our business mostly in the area of tree nuts – especially almonds, a crop of which we have significant acreage and to which we are exposed through participating rents. For example, a combination of trade tensions and logistical disruptions caused by the COVID-19 pandemic have affected the timing of pricing and sale of the 2020 almond crop, leading to a shift of revenuesAccording to the followingUSDA Outlook for Agricultural Trade, the top three export countries from the United States are China, Mexico, and Canada. Exports to China for fiscal year 2023 (October 2022 to September 2023) were $33.7 billion, down 7% from 2022. Exports to Canada were $27.9 billion, down 3% from 2022. Exports to Mexico were $28.2 billion, up 1% from 2022. Exports to China for fiscal year 2024 are forecast to decrease to $30 billion, while exports to Mexico and potentially lower overall revenues.Canada are expected to decrease slightly to $27.9 billion and $27.7 billion, respectively.

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Critical Accounting Policies and Estimates

The preparation of financial statements in conformity with GAAP requires that management to make estimates and assumptions that affect the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of our financial statements and the reported amounts of revenues and expenses during the reporting period. Actual amounts may differ significantly from these estimates and assumptions. We have provided a summary of our significant accounting policies in the notes to the historical consolidated financial statements included elsewhere in this filing. We have set forth below those accounting policies that we believe require material subjective or complex judgments and have the most significant impact on our financial condition and results of operations. We evaluate our estimates, assumptions and judgments on an ongoing basis, based on information that is then available to us, our experience and various matters that we believe are reasonable and appropriate for consideration under the circumstances.

Real Estate Acquisitions

When we acquire farmland where substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset or group of similar identifiable assets it is not considered a business. As such, we account for these types of acquisitions as asset acquisitions. When substantially all of the fair value of the gross assets acquired is not concentrated in a single identifiable asset or a group of similar assets and contains acquired inputs, processes and outputs, these acquisitions are accounted for as a business combination.

We consider single identifiable assets as tangible assets that are attached to and cannot be physically removed and used separately from another tangible asset without incurring significant cost or significant diminution in utility or fair value. We consider similar assets as assets that have a similar nature and risk characteristics.

Whether our acquisitions are treated as an asset acquisition under ASC 360 or a business combination under ASC 805, the fair value of the purchase price is allocated among the assets acquired and any liabilities assumed by valuing the property as if it was vacant.  The “as-if-vacant” value is allocated to land, buildings, improvements, permanent plantings and any liabilities, based on management’s determination of the relative fair values of such assets and liabilities as of the date of acquisition.

Upon acquisition of real estate, we allocateallocating the purchase price of properties acquired using the real estate based upon therelative fair value, a number of the assetssignificant assumptions can be used by management. We may utilize various sources, including third-party appraisals, our own analysis of recently acquired or developed properties and liabilities acquired, which historically have consisted of land, drainage improvements, irrigation improvements, groundwater, permanent plantings (bushes, shrubs, vines, and perennial crops), and grain facilities, and may also consist of intangible assets including in-place leases, above market and below market leases, and tenant relationships. We allocate the purchase price to the fair value of the tangible assets by valuing the land as if it were unimproved. We value improvements, including permanent plantings and grain facilities, at replacement cost, adjusted for depreciation.

Our estimates of land value are made using aexisting comparable sales analysis. Factors considered by usproperties in our analysis of land value includeportfolio, other market data and property specific characteristics such as soil types, and water availability and the sales pricesexistence of comparable farms. Our estimates of groundwater value are made using historical information obtained regarding the applicable aquifer.  Factors considered by us in our analysis of groundwater value are related to the location of the aquifer and whether or not the aquifer is a depletable resource or a replenishing resource.  If the aquifer is a replenishing resource, no value is allocated to the groundwater.  We include an estimate of property taxes in the purchase price allocation of acquisitions to account for the expected liability that was assumed. 

When above or below market leases are acquired we value the intangible assets based on the present value of the difference between prevailing market rates and the in-place rates measured over a period equal to the remaining term of the lease for above market leases and the initial term plus the term of any below market fixed rate renewal options for below market leases that are considered bargain renewal options. The above market lease values will be amortized as a reduction of rental income over the remaining term of the respective leases. The fair value of acquired below market leases, included in deferred revenue on the accompanying consolidated balance sheets, is amortized as an increase to rental income on a straight-line basis over the remaining non-cancelable terms of the respective leases, plus the terms of any below market fixed rate renewal options that are considered bargain renewal options of the respective leases.

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The purchase price is allocated to in-place lease values and tenant relationships, if they are acquired, based on our evaluation of the specific characteristics of each tenant’s lease, availability of replacement tenants, probability of lease renewal, estimated down time, and our overall relationship with the tenant. The value of in-place lease intangibles and tenant relationships will be included as an intangible asset and will be amortized over the remaining lease term (including expected renewal periods of the respective leases for tenant relationships) as amortization expense. If a tenant terminates its lease prior to its stated expiration, any unamortized amounts relating to that lease, including (i) above and below market leases, (ii) in-place lease values, and (iii) tenant relationships, would be recorded to revenue or expense as appropriate.

We capitalize acquisition costs and due diligence costs if the asset is expected to qualify as an asset acquisition. If the asset acquisition is abandoned, the capitalized asset acquisition costs will be expensed to acquisition and due diligence costs in the period of abandonment. Costs associated with a business combination are expensed to acquisition and due diligence costs as incurred.

Total consideration for acquisitions may include a combination of cash and equity securities.  When equity securities are issued, we determine the fair value of the equity securities issued based on the number of shares of common stock and Common units issued multiplied by the stock price on the date of closing in the case of common stock and Common units and by liquidation preference in the case of preferred stock and preferred units.

Using information available at the time of a business combination, we allocate the total consideration to tangible assets and liabilities and identified intangible assets and liabilities.  During the measurement period, which may be up to one year from the acquisition date, the Company may adjust the preliminary purchase price allocations after obtaining more information about assets acquired and liabilities assumed at the date of acquisition. 

Real Estate

Our real estate consists of land, groundwater, permanent crops (consisting of trees and vines) and improvements made to the land consisting of grain facilities, irrigation improvements, other assets and drainage improvements. We record real estate at cost and capitalize improvements and replacements when they extend the useful life or improve the efficiency of the asset. We expense costs of repairs and maintenance as such costs are incurred.  We begin depreciating assets when the asset is ready for its intended use.  We compute depreciation and depletion for assets classified as improvements using the straight-line method over the estimated useful life of 10-40 years for grain facilities, 2-40 years for irrigation improvements, 20-65 for drainage improvements, 3-50 years for groundwater, 13-40 years for permanent plantings, and 5-40 years for other assets acquired. We periodically evaluate the estimated useful lives for groundwater based on current state water regulations and depletion levels of the aquifers.  

When a sale occurs, we recognize the associated gain when all consideration has been transferred, the sale has closed, and there is no material continuing involvement. If a sale is expected to generate a loss, we first assess it through the impairment evaluation process. See ‘‘—Impairment of Real Estate Assets’’ below

Impairment of Real Estate Assets

We evaluate our tangible and identifiable intangible real estate assets for impairment indicators whenever events such as declines in a property’s operating performance, deteriorating market conditions, or environmental or legal concerns bring recoverability of the carrying value of one or more assets into question. If such events are present, we project the total undiscounted cash flows of the asset, including proceeds from disposition, and compare it to the net book value of the asset. If this evaluation indicates that the carrying value may not be recoverable, an impairment loss is recorded in earnings equal to the amount by which the carrying value exceeds the fair value of the asset. There have been no impairments recognized on real estate assets in the accompanying financial statements.

Inventory of our TRS

The costs of growing crop are accumulated until the time of harvest at the lower of cost or net realizable value and are included in inventory in our consolidated financial statements. Costs are allocated to growing crops based on a percentage of the total costs of production and total operating costs that are attributable to the portion of the crops that remain in

49

inventory at the end of the year.  Growing crop consists primarily of land preparation, cultivation, irrigation and fertilization costs incurred by FPI Agribusiness. Growing crop inventory is charged to cost of products sold when the related crop is harvested and sold.

Harvested crop inventory includes costs accumulated during both the growing and harvesting phases and is stated at the lower of those costs or the estimated net realizable value, which is the market price, based upon the nearest market in the geographic region, less any cost of disposition.  Cost of disposition includes broker’s commissions, freight and other marketing costs.  

Revenue Recognition

Rental income includes rents that each tenant pays in accordance with the terms of its lease. Minimum rents pursuant to leases are recognized as revenue on a straight-line basis over the lease term, including renewal options in the case of bargain renewal options. Deferred revenue includes the cumulative difference between the rental revenue recorded on a straight-line basis and the cash rent received from tenants in accordance with the lease terms. Acquired below market leases are included in deferred revenue on the accompanying consolidated balance sheets, which are amortized into rental income over the life of the respective leases, plus the terms of the below market renewal options, if any.

Farm leases in place as of December 31, 2020 had terms ranging from one to forty years. As of December 31, 2020, we had 99 leases over 209 properties with rent escalations. The majority of our leases provide for a fixed annual or semi-annual cash rent payment. Tenant leases on acquired farms generally require the tenant to pay us rent for the entire initial year regardless of the date of acquisition, if the acquisition is closed prior to, or shortly after, planting of crops. If the acquisition is closed later in the year, we typically receive a partial rent payment or no rent payment at all.

Certain of our leases provide for a portion of the rent determined as a percentage of the gross farm proceeds. Revenue under leases providing for a payment equal to a percentage of the gross farm proceeds are recorded at the guaranteed crop insurance minimums and recognized ratably over the lease term during the crop year. Upon notification from the grain or packing facility that a future contract for delivery of the harvest has been finalized or when the tenant has notified us of the total amount of gross farm proceeds, revenue is recognized for the excess of the actual gross farm proceeds and the previously recognized minimum guaranteed insurance. Revenue derived from a percentage of the farm gross proceeds that is over and above the crop insurance minimums is recognized once crop price and quantity are known (typically at or after the time the crops are harvested). As a result, we are only able to recognize revenue from such leases once annually.

Certain of our leases provide for minimum cash rent plus a bonus based on gross farm proceeds. Revenue under this type of lease is recognized on a straight-line basis over the lease term based on the minimum cash rent. Bonus rent is recognized upon notification from the grain or packing facility that a future contract for delivery of the harvest has been finalized or when the tenant has notified us of the total amount of gross farm proceeds

Tenant reimbursements include reimbursements for real estate taxes that each tenant pays in accordance with the terms of its lease. When leases require that the tenant reimburse us for property taxes paid by us, the reimbursement is reflected as tenant reimbursement revenue on the statements of operations, as earned, and the related property tax as property operating expense, as incurred.

We recognize interest income on notes receivable on an accrual basis over the life of the note. Direct origination costs are netted against loan origination fees and are amortized over the life of the note using the straight-line method, which approximates the effective interest method, as an adjustment to interest income which is included in other revenue in the Company’s Consolidated Statements of Operations for the years ended December 31, 2020 and 2019.

Crop sales revenue

We record revenue from the sale of harvested crops when the harvested crop has been contracted to be delivered to a grain or packing facility and title has transferred. Harvested crops delivered under marketing contracts are recorded using the fixed price of the marketing contract at the time of delivery to a grain or packing facility. Harvested crops delivered without a marketing contract are recorded using the market price at the date the harvested crop is delivered to the grain or

50

packing facilitythe acquisition. The allocations of purchase price are sensitive and title has transferred.involve a degree of uncertainty due to the nature of the inputs and judgements, as well as the number, magnitude and complexity of these inputs and judgements made by management. See “Note 5—Real Estate” for additional discussion regarding acquisitions completed by the Company.

Other revenueImpairment of Real Estate Assets

We recognize interest incomeAssessing impairment can be complex and involves a high degree of subjectivity in determining if impairment indicators are present and in estimating the future undiscounted cash flows or the fair value of an asset. In particular, these estimates are sensitive to significant assumptions, including the estimation of future rental revenues, operating expenses, discount and capitalization rates and our intent and ability to hold the related asset, all of which could be affected by our expectations about future market or economic conditions. Assumptions are primarily subject to property-specific characteristics, especially with respect to our intent and ability to hold the related asset. While these property-specific assumptions can have a significant impact on notes receivable on an accrual basis over the lifeundiscounted cash flows or estimated fair value of a particular asset, our evaluation of the note. Direct origination costs are netted against loan origination feesreported carrying values of long-lived assets during the current year were not particularly sensitive to external or market assumptions. There was $5.8 million and are amortized over the life$0.0 million of the note using the straight-line method, which approximates the effective interest method, as an adjustment to interest income which is included in other revenueimpairment recognized on real estate assets in the Company’s Consolidated Statements of Operations foraccompanying financial statements during the years ended December 31, 20202023 and 2019.2022, respectively.

Income TaxesImpairment of Goodwill and Intangible Assets with Indefinite Lives

As a REIT,Goodwill is not amortized, but rather tested for income tax purposes we are permitted to deduct dividends paid to our stockholders, thereby eliminating the U.S. federal taxation of income represented by such distributions at the Company level, provided certain requirements are met. REITs are subject to a number of organizational and operational requirements. If we fail to qualify as a REIT in any taxable year, we will be subject to U.S. federal income tax (including, for periods prior to 2018, any applicable alternative minimum tax) on our taxable income at regular corporate tax rates.

The Operating Partnership leases certain of its farms to the TRS, which is subject to federal and state income taxes.  We account for income taxes using the asset and liability method under which deferred tax assets and liabilities are recognized for temporary differences between the financial reporting basis of assets and liabilities and their respective income tax basis and for operating loss, capital loss and tax credit carryforwards based on enacted income tax rates expected to be in effect when such amounts are realized or settled.  However, deferred tax assets are recognized only to the extent that it is more likely than not they will be realized on consideration of available evidence, including future reversals of existing taxable temporary differences, future projected taxable income and tax planning strategies. There was $(1.9) million in taxable income from the TRS for the year ended December 31, 2020, and $(0.2) million in taxable income for the year ended December 31, 2019.

We perform an annual review for any uncertain tax positions and, if necessary, will record future tax consequences of uncertain tax positionsimpairment annually in the financial statements.  An uncertain tax position is defined as a position takenfourth quarter and when events or expected to be takenchanges in a tax returncircumstances indicate that is not based on clear and unambiguous tax law and which is reflected in measuring current or deferred income tax assets and liabilities for interim or annual periods. At December 31, 2020, we did not identify any uncertain tax positions.

When we acquire a property in a business combination, we evaluate such acquisition for any related deferred tax assets or liabilities and determine if a deferred tax asset or liability should be recorded in conjunction with the purchase price allocation.  If a built-in gain is acquired, we evaluate the required holding period (generally 5 years) and determine if we have the ability and intent to hold the underlying assets for the necessary holding period.  If we have the ability to hold the underlying assets for the required holding period, no deferred tax liability will be recorded with respect to the built-in gain. We determined that no deferred tax assets or liabilities were recorded through acquisition activity that we undertook during the year ended December 31, 2020.

Derivatives and Hedge Accounting

We manage economic risks, including interest rate, liquidity, and credit risk, by managing the amount, sources, duration and interest rate exposure of our funding. We may also use interest rate derivative financial instruments, namely interest rate swaps.

We enter into marketing contracts to sell commodities. Derivatives and hedge accounting guidance requires us to evaluate these contracts to determine whether the contracts are derivatives. Certain contracts that meet the definition of a derivative may be exempt from derivative accounting if designated as normal purchase or normal sales. We evaluate all contracts at inception to determine if they are derivatives and if they meet the normal purchase and normal sale designation requirements. All contracts entered into during the year ended December 31, 2020 met the criteria to be exempt from derivative accounting and were designated as normal purchase and sales exceptions for hedge accounting.

51

We have in place one interest rate swap agreement with Rabobank to add stability to interest expense and to manage our exposure to interest rate movements. This agreement qualifies as a cash flow hedge and is actively evaluated for its effectiveness (see Note 12 – “Hedge Accounting”). The entire change in the fair value of our designated cash flow hedges is recorded to accumulated other comprehensive income, a component of shareholders’ equity in our consolidated balance sheets.

Additionally, we assesses whether the derivative used in our hedging transaction is expected to be highly effective in offsetting changes inreporting unit with goodwill has been reduced below its carrying value. Assessing the fair value orof a reporting unit involves a high degree of subjectivity. Significant assumptions include future cash flows offlow, discount rates and future capital requirements. If the hedged item. We discontinue hedge accounting when it is determined that a derivative has ceased to be or is not expected to be highly effective as a hedge, and then reflect changes in fair value of the derivativereporting unit is less than its carrying value, an impairment expense is recognized. Intangible assets with indefinite lives is not amortized, but rather tested for impairment annually in earnings after terminationthe fourth quarter and when events or changes in circumstances indicate that the fair value of the hedge relationship.asset is below its carrying value. Assessing the fair value of the asset involves a high degree of subjectivity regarding the significant assumptions including future cash flow and the discount rate. There have been no goodwill or intangible asset impairments recognized in the accompanying financial statements during the years ended December 31, 2023 and 2022.

New or Revised Accounting Standards

For a summary of the new or revised accounting standards please refer to “Note 1 – Organization and Significant Accounting Policies” within the notes to the combined consolidated financial statements included elsewhere in this Annual Report on Form 10-K.

Results of Operations

This section of this Annual Report on Form 10-K generally discusses 20202023 and 20192022 items and year-to-year comparisons between 20202023 and 2019.2022. Year-to-year comparisons between 20192022 and 20182021 that are not included in this Form 10-K can be found in “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in Part II, Item 7 of the Company’s Annual Report on Form 10-K for the fiscal year ended December 31, 2019.2022.

51

Comparison of the year ended December 31, 20202023 to the year ended December 31, 20192022

For the year ended December 31,

 

For the years ended December 31,

 

($ in thousands)

    

2020

    

2019

    

$ Change

    

% Change

 

    

2023

    

2022

    

$ Change

    

% Change

OPERATING REVENUES:

Rental income

$

43,693

$

48,119

$

(4,426)

 

(9.2)

%

$

49,185

$

48,879

$

306

 

0.6

%

Tenant reimbursements

 

3,637

 

3,146

 

491

 

15.6

%

Crop Sales

1,902

978

924

94.5

%

Crop sales

2,257

5,372

(3,115)

(58.0)

%

Other revenue

 

1,457

 

1,321

 

136

 

10.3

%

 

6,024

 

6,959

 

(935)

 

(13.4)

%

Total operating revenues

 

50,689

 

53,564

 

(2,875)

 

(5.4)

%

 

57,466

 

61,210

 

(3,744)

 

(6.1)

%

OPERATING EXPENSES:

Depreciation and depletion

 

7,972

 

8,320

 

(348)

 

(4.2)

%

OPERATING EXPENSES

Depreciation, depletion and amortization

 

7,499

 

6,960

 

539

 

7.7

%

Property operating expenses

 

7,350

 

7,897

 

(547)

 

(6.9)

%

 

8,660

 

8,190

 

470

 

5.7

%

Cost of goods sold

3,387

927

2,460

NM

4,754

5,966

(1,212)

(20.3)

%

Acquisition and due diligence costs

 

11

 

6

 

5

 

83.3

%

 

17

 

111

 

(94)

 

(84.7)

%

General and administrative expenses

 

5,896

 

6,102

 

(206)

 

(3.4)

%

 

11,274

 

12,005

 

(731)

 

(6.1)

%

Legal and accounting

 

3,742

 

3,971

 

(229)

 

(5.8)

%

 

1,279

 

2,874

 

(1,595)

 

(55.5)

%

Impairment of assets

 

5,840

 

 

5,840

 

NM

Other operating expenses

2

4

(2)

NM

144

130

14

10.8

%

Total operating expenses

 

28,360

 

27,227

 

1,133

 

4.2

%

 

39,467

 

36,236

 

3,231

 

8.9

%

OPERATING INCOME

 

22,329

 

26,337

 

(4,008)

 

(15.2)

%

OTHER (INCOME) EXPENSE:

Other income

111

(260)

371

(142.7)

%

Gain on sale of assets

(2,989)

(7,841)

4,852

NM

Other (income)

(39)

(663)

624

(94.1)

%

(Income) from equity method investment

(1)

(52)

51

(98.1)

%

(Gain) on disposition of assets, net

(36,133)

(2,641)

(33,492)

NM

Interest expense

 

17,677

 

19,588

 

(1,911)

 

(9.8)

%

 

22,657

 

16,143

 

6,514

 

40.4

%

Total other expense

 

14,799

 

11,487

 

3,312

 

28.8

%

 

(13,516)

 

12,787

 

(26,303)

 

NM

Net income before income tax expense

7,530

14,850

(7,320)

(49.3)

%

Net income before income tax (benefit) expense

31,515

12,187

19,328

158.6

%

Income tax expense

NM

Income tax (benefit) expense

(166)

227

(393)

NM

NET INCOME

$

7,530

$

14,850

$

(7,320)

 

(49.3)

%

$

31,681

$

11,960

$

19,721

 

164.9

%

NM = Not Meaningful

Our net income for the year ended December 31, 2023 was affected partially by acquisitions and dispositions that occurred since December 31, 2022, as well as lower crop sales, cost of goods sold, auction and brokerage revenue, legal and accounting expense, higher interest expense and the impairment of certain properties.

Rental income increased $0.3 million, or 0.6%, for the year ended December 31, 2023 compared to the year ended December 31, 2022, resulting primarily from increased fixed farm rent, solar rent and revenue recognized from tenant reimbursements, partially offset by lower variable rent.

Crop sales decreased $3.1 million, or 58.0%, for the year ended December 31, 2023 compared to the year ended December 31, 2022. This decrease was the result of a lower volume of crop sold on citrus farms and the conversion of blueberry farms from direct operations to third party leases.

Other revenue decreased $0.9 million, or 13.4%, for the year ended December 31, 2023 compared to the year ended December 31, 2022. This decrease was primarily due to a decrease of $1.6 million in auction and brokerage income, and a decrease of $0.3 million in crop insurance proceeds, partially offset by an increase of $1.0 million in management fees and interest income.

52

Our rental income for 2020 was impacted by the two acquisitionsDepreciation, depletion and four dispositions that took place in 2019, in addition to the three acquisitions and seven dispositions, consisting of eleven farms, that took place in 2020. To highlight the effect of changes in our rental income due to acquisitions, we have separately discussed the rental income for the same-property portfolio, which includes only properties owned and operated for the entirety of both periods presented. The same-property portfolio for the year ended December 31, 2020 includes approximately 145,000 acres, representing 94% of our current portfolio on an acreage basis. Total rental income under leases for the same-property portfolio decreased $3.2amortization increased $0.5 million, or 7.12%, from $45.4 million for the year ended December 31, 2019 to $42.2 million for the year ended December 31, 2020, largely due to a decrease in crop share revenue in the permanent crop portfolio as a result of a decrease in demand for lemons and blueberries, and delayed and weak pricing of the 2020 almond crop as a result of the COVID-19 pandemic and trade war related disruptions.

Rental income decreased $4.4 million, or 9.2%7.7%, for the year ended December 31, 2020 as2023 compared to the prior year, as a result of the impact of the COVID-19 pandemic on the demand for lemons and blueberries, the impact of international trade disruptions on the pricing of almonds (resulting in potentially both a delay and reduction of related revenues), the impact of low cyclical yields of pistachios, and asset dispositions.

Revenues recognized from tenant reimbursement of property taxes increased $0.5 million, or 15.6%, during the year ended December 31, 2020 as compared to the prior year. The2022. This increase in tenant reimbursements was the result of an increasedriven by non-recurring adjustments in the numbersecond and third quarters of leases in place under which we were reimbursed for property taxes, as well as a general overall increase in property tax expense on a same property basis for which we were reimbursed.2023 and more depreciable assets placed into service, partially offset by asset dispositions and more assets becoming fully depreciated.

Crop salesProperty operating expenses increased $0.9$0.5 million, or 94.5%5.7%, for the year ended December 31, 2020 as2023 compared to the prior year. The increase is the result of a larger number of properties directly operated by the Company.

Other revenues increased $0.1 million, or 10.3%, for the year ended December 31, 2020 as compared to the prior year. This change was largely due to2022, resulting from higher tax, insurance, and cost sharing on a $0.5 million increase in crop insurance proceeds during 2020,West Coast farm, partially offset by lower interest income on loans receivable.

Depreciation, depletion and amortization expense decreased $0.3 million, or 4.2%, for the year ended December 31, 2020 as compared to the prior year as a result of selling approximately $3.1 million in depreciable assets in 2020.

Property operating expenses decreased $0.5 million, or 6.9%, for the year ended December 31, 2020 as compared to the prior year. The decrease primarily relates to the initial accounting of a sales-type equipment lease in the third quarter of 2019 that was terminated in the first quarter of 2020, as well as an overall net reduction in acreage due to asset sales in 2020.utilities expense.

Cost of goods sold increased $2.5decreased $1.2 million, or 20.3%, for the year ended December 31, 2020 as2023 compared to the prior year.year ended December 31, 2022. This increasedecrease was largely due tothe result of a higherlower volume of crop sold on citrus farms and the conversion of blueberry farms from direct operations to third party leases, partially offset by an increase in 2020 aswalnuts in the Company direct operated more acres in 2020 than in 2019.year ended December 31, 2023 compared to the year ended December 31, 2022.

Acquisition and due diligence costs were negligible and remained relatively consistent in 2020 compared toflat at $0.0 million and $0.1 million for the prior year.years ended December 31, 2023 and 2022, respectively.

General and administrative expenses declined by $0.2decreased $0.7 million, or 3.4%6.1%, for the year ended December 31, 2020 as2023 compared to the prior year. Theyear ended December 31, 2022. This decrease is largely due towas primarily driven by lower overallbonus, stock-based compensation and travel expense partially offset by higher payroll costs for employees and lower travel expenses in 2020 due to the COVID-19 pandemic.costs.

Legal and accounting expenses decreased $0.2$1.6 million, or 5.8%55.5%, for the year ended December 31, 20202023 compared to the year ended December 31, 2022, due primarily to the successful defense and termination of the stockholder class action litigation that was pending against the Company from July 2018 until dismissal of the litigation by a federal judge on April 6, 2022.

Impairment of assets increased $5.8 million for the year ended December 31, 2023 compared to the year ended December 31, 2022. This increase was the result of certain properties being written down to their estimated fair value.

Other operating expenses remained flat at $0.1 million for each of the years ended December 31, 2023 and 2022.

Other income decreased $0.6 million, or 94.1%, for the year ended December 31, 2023 compared to the year ended December 31, 2022. This decrease is primarily due to proceeds from a property insurance claim received during the year ended December 31, 2022, due to weather-related damage, partially offset by loss on early extinguishment of debt during the year ended December 31, 2022.

Income from equity method investment remained relatively flat at $0.0 million and $0.1 million for the year ended December 31, 2023 and 2022, respectively.

Gain on disposition of assets, net increased $33.5 million for the year ended December 31, 2023 compared to the year ended December 31, 2022, primarily due the appreciation of farmland value on properties sold relative to book value as well as a greater number of property dispositions during the year ended December 31, 2023 as compared to the prior year.year ended December 31, 2022. In connection with the sale of two farms in December 2023 pursuant to which we provided $9.5 million of seller financing, we deferred an additional net gain on sale of $2.1 million. The changedeferred gain will be recognized at such time as we consider collection of the seller-financed portion of the sale price to be probable under applicable accounting standards.

Interest expense increased $6.5 million, or 40.4%, for the year ended December 31, 2023 compared to the year ended December 31, 2022. This increase was primarily athe result of an increase in interest rates, partially offset by a slight decrease in legal fees incurred in relationlower average balance on outstanding debt.

Income tax (benefit) changed from income tax expense of $0.2 million for the year ended December 31, 2022 to a “short and distort” attack againstincome tax benefit of $0.2 million for the Company conducted by parties under the pseudonym Rota Fortunae, as discussed below under Note 8year ended December 31, 2023. This change is due to our Consolidated Financial Statements included in Part IV, Item 8tax adjustments of this Annual Report on Form 10-K. The Company is pursuing litigation against Rota Fortunae and is defending stockholder class action lawsuits that are related to the claims made by Rota Fortunae. The Company has not recognized any receivable for insurance recoveries that the Company believes it will be entitled to. The Company does not expect insurance proceeds to cover a substantial portionprior period estimates.

53

of the costs related to the lawsuit it filed against Rota Fortunae. Additionally, the Company received $0.5 million in insurance proceeds related to the Rota Fortunae litigation that were used to offset legal fees. There was no impact on reported earnings as a result.

Other operating expenses were negligible and remained relatively consistent in 2020 compared to the prior year.

Other income totaled $(0.1) million during the year ended December 31, 2020 compared to $0.3 million during the prior year. The change is largely attributable to lower interest income and increased losses on commodity trading.

The gain / loss on disposition of assets decreased $4.9 million for the year ended December 31, 2020 as compared to the prior year due primarly to larger gains on sales of properties in the Corn Belt and the Southeast regions in 2019.

Interest expense decreased $1.9 million, or 9.8%, for the year ended December 31, 2020 as compared to the prior year. This decrease is related to lower interest rates and paydown of debt principal in 2020.

Liquidity and Capital Resources

Overview

Liquidity is a measure of our ability to meet potential cash requirements, including ongoing commitments to repay any outstanding borrowings, fund and maintain our assets and operations, acquire new properties, make distributions to our stockholders and to Common unitholders, and fund other general business needs.

Our short-termHigh levels of inflation have prompted the Federal Reserve to increase interest rates which has resulted in, and may continue to result in, increased interest expense. We expect to meet our liquidity requirements consist primarily of funds necessary to acquire additional farmland, make other investments consistent with our investment strategy, make principal and interest payments on outstanding borrowings, make distributions on our Series A preferred units and Series B Participating Preferred Stock, make distributions necessary to qualify for taxation as a REIT, fund our operations, and pay legal fees in relation to the Rota Fortunae litigation in excess of the Company’s insurance coverage. Our sources of funds primarily will beneeds through cash on hand, undrawn availability under our lines of credit ($201.1 million in availability as of December 31, 2023), operating cash flows, borrowings, proceeds from equity issuances and borrowings from prospective lenders. 

Our long-term liquidity needs consist primarily of funds necessaryselective asset dispositions where such dispositions are deemed to acquire additional farmland, make other investments and certain long-term capital expenditures, make principal and interest payments on outstanding borrowings, and make distributions necessary to qualify for taxation as a REIT. In lightbe in the best interests of the level atCompany.

On May 6, 2022, we entered into equity distribution agreements under which we may issue and sell from time to time, through sales agents, shares of our common stock has tradedhaving an aggregate gross sales price of up to $100.0 million (the “ATM Program”). The ATM Program is intended to provide cost-effective financing alternatives in recent years, we have not been ablethe capital markets. We intend to accesscontinue to utilize the equity capital markets in order to fund our liquidity needs. Furthermore, because ofATM Program when the tradingmarket price of our common stock we have been unable to fund acquisitionsremains at levels which are deemed appropriate by our Board of farmland with Common units.Directors. We may consider raising equity capital or acquiring farmland withincrease the size of the ATM Program in the future. During the year ended December 31, 2023, we sold no shares under the ATM Program and had $50.5 million in shares of common units if we can do so in a way that causes minimal dilution to our existing stockholders. We expect to meet our long-term liquidity requirements through various sources of capital, including net cash provided by operations, long-term mortgage indebtedness and other secured and unsecured borrowings, asset dispositions and, givenstock available for issuance under the recent recovery in our stock price, future equity issuances (including issuances of Common units).ATM Program.

Our ability to incur additional debt will depend on a number of factors, including our degree of leverage, the value of our unencumbered assets, compliance with the covenants under our existing debt agreements, borrowing restrictions that may be imposed by lenders and the conditions of debt markets. Our ability to access the equity capital markets will depend on a number of factors as well, including general market conditions for REITs and market perceptions about us.

We manage our liquidity position and expected liquidity needs taking into consideration current cash balances and reasonably expected cash receipts. Our business model, and the business model of real estate investment companies in general, relies on debt as a structural source of financing. When debt becomes due, it is generally refinanced rather than repaid using our cash flow from operations. When material debt repayments are due within the following 12 months, we work with current and new lenders and other potential sources of capital sufficiently in advance of the debt maturity to ensure that all of our obligations are satisfied in a timely manner. We have a history of being able to refinance or extend our debt obligations to manage our debt maturities. Furthermore,Our ability to access the equity capital markets will depend on a number of factors as well, including general market conditions. We have an effective shelf registration statement with approximately $100 million of capacity (approximately $150 million inclusive of the ATM Program availability mentioned above) whereby we could issue additional equity or debt securities, which we have a large portfolio of high-quality real estate assets which we believe could be selectively and readily liquidated if necessary to fund our immediate liquidity needs.  Our first course of action is to work with our lenders to

54

refinancedone successfully in the past as mentioned above. The Company has no material debt which is comingmaturities due on terms acceptable to us. In the event that we are unsuccessful in refinancing our debt on terms acceptable to us, we would look to liquidate certain assets to fund our liquidity shortfall. On January 29, 2021, the Company entered into an amendment to extend the maturity dates of its five Rutlege Promissory Notes from January 1, 2022 to April 1, 2022.before 2025.

During the year ended December 31, 2023, the Company repurchased 6,551,087 shares of its common stock at a weighted average price of $11.00 per share. We currently have authority to repurchase up to an aggregate of $83.3 million in additional shares of our common stock. In addition, the Company redeemed 34,000 Common units in exchange for cash of approximately $0.4 million.

Consolidated Indebtedness

For further details relating to our consolidated indebtnessindebtedness refer to “– Recent Developments – Financing Activity” and Note 7 – Mortgage Notes, Line of Credit and Bonds Payable included in the financial statement section of this Annual Report on Form 10-K.

54

Sources and Uses of Cash and Cash Equivalents

The following table summarizes our cash flows for the years ended December 31, 20202023 and 2019:2022:

For the year ended December 31,

($ in thousands)

    

2020

    

2019

    

Net cash provided by operating activities

$

19,726

$

17,994

Net cash provided by investing activities

$

18,668

$

31,052

Net cash used in financing activities

$

(23,738)

$

(53,376)

For the years ended December 31,

(in thousands)

    

2023

    

2022

Net cash and cash equivalents provided by operating activities

$

12,887

$

17,051

Net cash and cash equivalents provided by (used in) investing activities

$

158,461

$

(60,398)

Net cash and cash equivalents provided by (used in) financing activities

$

(173,513)

$

20,830

Comparison of the year ended December 31, 20202023 to the year ended December 31, 20192022

As of December 31, 2020,2023, we had $27.2$5.5 million of cash and cash equivalents compared to $12.6$7.7 million at December 31, 2019.2022.

Cash Flows from Operating Activities

Net cash and cash equivalents provided by operating activities increased $1.7decreased by $4.2 million primarily as a result of the following:

IncreaseReceipt of $39.8 million in fixed rents, $9.0 million in variable rent and $2.2 million in tenant reimbursements for the year ended December 31, 2023 as compared to the receipt of $35.8 million in fixed rents, $9.5 million in variable rents, and $2.2 million in tenant reimbursements for the year ended December 31, 2022;
A change in depreciation, depletion and amortization of $7.5 million for the year ended December 31, 2023 compared to $7.0 million for the year ended December 31, 2022;
(Gain) on disposition of assets, net during the year ended December 31, 2023 of $36.1 million as compared to $2.6 million during the year ended December 31, 2022;
A change in accounts receivable of $0.9 million for the year ended December 31, 2023 compared to $(2.3) million for the year ended December 31, 2022;
A change in accrued interest of $0.6 million for the year ended December 31, 2023 compared to $1.4 million in 2020 as compared tofor the same period of 2019;
Decrease in net income of $7.3 million in 2020 as compared to the same period in 2019;
Decrease in gain on disposition of assets of $4.9 million as compared to the same period in 2019
Decrease in inventory of $1.7 million from 2019 to 2020;year ended December 31, 2022; and
IncreaseA change in loss relateddeferred revenue of $0.6 million for the year ended December 31, 2023 compared to settlement of interest rate swap of $0.8$0.1 million in 2020for the year ended December 31, 2022.

Cash Flows from Investing Activities

Net cash and cash equivalents provided by (used in) investing activities decreased $12.4increased by $218.9 million primarily as a result of the following:

Completing three assetProperty acquisitions in 2020during the year ended December 31, 2023 of $22.2 million as compared to $54.4 million during the year ended December 31, 2022;
Property dispositions during the year ended December 31, 2023 for cash consideration of $0.9 million, and principal receipt on notes receivable of $0.5$195.5 million as compared to two acquisitions for aggregate cash consideration of $1.4$17.0 million of cash and $6.7 in principal receipts of notes receivable in 2019;during the year ended December 31, 2022;
InvestingAn increase of $2.7$1.6 million in real estate improvements during the year ended December 31, 2020,2023 as compared to $6.6 million in 2019;the year ended December 31, 2022; and
Receiving $20.5Issuances of notes receivable under the FPI Loan Program and financing receivables of $11.8 million fromduring the sale of property in 2020year ended December 31, 2023 as compared to $34.1$20.8 million in 2019during the year ended December 31, 2022.

Cash Flows from Financing Activities

Net cash used in financing activities decreased $29.6 million primarily as a result of the following:

Borrowings from mortgage notes payable of $54.4 million during the twelve months ended December 31, 2020, as compared to borrowings of $0.0 million in the twelve months ended December 31, 2019;
Debt repayments of $59.0 million during 2020, as compared to $11.4 million in 2019;

55

Cash Flows from Financing Activities

Net cash and cash equivalents provided by (used in) financing activities increased by $194.3 million primarily as a result of the following:

RepurchaseBorrowings from mortgage notes payable during the year ended December 31, 2023 of $6.8$79.5 million in common stock during 2020as compared to $22.0$223.0 million in 2019;  during the year ended December 31, 2022;
Dividend paymentsRepayments on mortgage notes payable during the year ended December 31, 2023 of $8.8$155.9 million to Series B Participating Preferred Stockholders made in 2020,as compared to $9.0$296.9 million during 2019;the year ended December 31, 2022;
ProceedsNet proceeds from the issuanceATM Program during the year ended December 31, 2023 of common$0.0 million as compared to $121.3 million during the year ended December 31, 2022;
Common stock repurchases during the year ended December 31, 2023 of $10.0$72.2 million as compared to $0.0 million in 2019;during the year ended December 31, 2022;
Repurchase of $3.1 millionRedemption of Series B Participating Preferred StockA preferred units during 2020the year ended December 31, 2023 of $8.1 million as compared to $0.9$10.2 million in 2019;during the year ended December 31, 2022; and
Dividend payments of $5.9 millionDividends on common stock in 2020,during the year ended December 31, 2023 of $12.3 million as compared to $6.2$11.1 million in 2019.during the year ended December 31, 2022.

Contractual Obligations

The following table sets forth our contractual obligations and commitments as of December 31, 2020:

($ in thousands)

Payments Due by Period

Contractual Obligations

    

2021

    

2022-2024

    

2025-2027

    

2028 & beyond

    

Total

Principal Payments of

Long-Term Indebtedness

$

-

$

114,100

$

221,849

$

172,237

$

508,186

Interest Payments on

Fixed-Rate Long-Term Indebtedness

11,942

35,827

25,257

32,524

105,550

Variable-Rate Long-Term Indebtedness

2,897

3,418

3,108

332

9,755

Commitment on Mortgage Note Receivable

-

-

-

-

-

Lease Payments

99

-

-

-

99

Capital Commitments

-

-

-

-

-

Total

$

14,938

$

153,345

$

250,214

$

205,093

$

623,590

(1)Variable rate long-term indebtedness has been determined for purposes of this table based upon the balance and interest rates in place as of December 31, 2020.

Off-Balance Sheet Arrangements

As of December 31, 2020, we did not have any off-balance sheet arrangements.

Non-GAAP Financial Measures

Funds from Operations (“FFO”) and Adjusted Funds from Operations (“AFFO”)

We calculate FFO in accordance with the standards established by the National Association of Real Estate Investment Trusts, or NAREIT. NAREITNareit. Nareit defines FFO as net income (loss) (calculated in accordance with GAAP), excluding gains (or losses) from sales of depreciable operating property, plus real estate related depreciation, depletion and amortization (excluding amortization of deferred financing costs), impairment write-downs of depreciated property, and after adjustments for unconsolidated partnerships and joint ventures. FFO is a supplemental non-GAAP financial measure. Management presents FFO as a supplemental performance measure because it believes that FFO is beneficial to investors as a starting point in measuring our operational performance. Specifically, in excluding real estate related depreciation and amortization and gains and losses from sales of depreciable operating properties, which do not relate to or are not indicative of operating performance, FFO provides a performance measure that, when compared year over year, captures trends in occupancy rates, rental rates and operating costs. We believe that, as a widely recognized measure of the performance of REITs, FFO will be used by investors as a basis to compare our operating performance with that of other REITs. 

 

However, because FFO excludes depreciation and amortization and captures neither the changes in the value of our properties that result from use or market conditions nor the level of capital expenditures necessary to maintain the operating performance of improvements on our properties, all of which have real economic effects and could materially impact our results from operations, the utility of FFO as a measure of our performance is limited. In addition, other equity REITs may not calculate FFO in accordance with the NAREITNareit definition as we do, and, accordingly, our FFO may not be comparable to such other REITs’ FFO. Accordingly, FFO should be considered only as a supplement to net income as a measure of our performance. FFO should not be used as a measure of our liquidity, nor is it indicative of funds available to fund our cash needs, including our ability to pay dividends or service indebtedness. FFO also should not be used as a supplement to or substitute for cash flow from operating activities computed in accordance with GAAP.

56

 

We do not, however, believe that FFO is the only measure of the sustainability of our operating performance. Changes in GAAP accounting and reporting rules that were put in effect after the establishment of NAREIT’sNareit’s definition of FFO in 1999 result in the inclusion of a number of items in FFO that do not correlate with the sustainability of our operating performance. Therefore, in addition to FFO, we present AFFO and AFFO per share, fully diluted, both of which are non-GAAP measures. Management considers AFFO a useful supplemental performance metric for investors as it is more indicative of the Company’s operational performance than FFO. AFFO is not intended to represent cash flow or liquidity for the period and is only intended to provide an additional measure of our operating performance. Even AFFO, however, does not properly capture the timing of cash receipts, especially in connection with full-year rent payments under lease agreements entered into in connection with newly acquired farms. Management considers AFFO per share, fully diluted to be a supplemental metric to GAAP earnings per share. AFFO per share, fully diluted provides additional insight into

56

how our operating performance could be allocated to potential shares outstanding at a specific point in time. Management believes that AFFO is a widely recognized measure of the operations of REITs, and presenting AFFO will enable investors to assess our performance in comparison to other REITs. However, other REITs may use different methodologies for calculating AFFO and AFFO per share, fully diluted, and, accordingly, our AFFO and AFFO per share, fully diluted may not always be comparable to AFFO and AFFO per share amounts calculated by other REITs. AFFO and AFFO per share, fully diluted should not be considered as an alternative to net income (loss) or earnings per share (determined in accordance with GAAP) as an indication of financial performance or as an alternative to net income (loss) earnings per share (determined in accordance with GAAP) as a measure of our liquidity, nor are they indicative of funds available to fund our cash needs, including our ability to make distributions.

AFFO is calculated by adjusting FFO to exclude or include the income and expenses that we believe are not reflective of the sustainability of our ongoing operating performance, as further explained below:

Real estate related acquisition and due diligence costs. Acquisition (including audit fees associated with these acquisitions) and due diligence costs are incurred for investment purposes and, therefore, do not correlate with the ongoing operations of our portfolio. The Company incurred an immaterial amount of acquisition and due diligence costs during the years ended December 31, 2023 and 2022. We believe that excluding these costs from AFFO provides useful supplemental information reflective of the realized economic impact of our leases,current acquisition strategy, which is useful in assessing the sustainability of our operating performance. AcquisitionThese exclusions also improve the comparability of our results over each reporting period and due diligence costs totaled $0.0 million for the years ended December 31, 2020 and 2019, respectively. A portion of the audit fees we incur are directly related to acquisitions, which variesCompany with the number and complexity of the acquisitions we evaluate and complete in a given period.  As such, these costs do not correlate with the ongoing operations of our portfolio. Total acquisition related audit fees excluded from AFFO totaled $0.0 million for the years ended December 31, 2020 and 2019, respectively.other real estate operators.

Stock based compensation. Stock-based compensation and incentive. Stock basedStock-based compensation and incentive is a non-cash expense and, therefore, does not correlate with the ongoing operations.operations of our portfolio. We believe that excluding these costs from AFFO improves the comparability of our results over each reporting period and of ourthe Company with other real estate operators.

Deferred impact of interest rate swap terminations. When an interest rate swap is terminated and the related termination fees are rolled into a new swap, the terminated swap's termination fees are amortized over what would have been the remaining life of the terminated swap, while the related contractual and financial obligations extend over the life of the new swap. As a result, the net impact on interest expense is uneven throughout the life of the swap, which is inconsistent with the purpose of an interest rate swap. We believe that, with this adjustment, AFFO better reflects the actual cash cost of the fixed interest rate we are obligated to pay under the new swap agreement, and results in improved comparability of our results across reporting periods.

Distributions on Series A preferred units. Dividends on Series A preferred units, which are convertible into Common units on or after February 10, 2026, have a fixed and certain impact on our cash flow, thus theyand therefore are subtractedexcluded from FFO.AFFO. We believe this improves the comparability of ourthe Company with other real estate operators.

Dividends on Series B Participating Preferred Stock.  Dividends on Series B Participating Preferred Stock, which may be redeemed for cash or converted into shares of common stock on or after September 30, 2021, have a fixed and certain impact on our cash flow, thus they are subtracted from FFO.  We believe this improves comparability of our Company with other real estate operators.

57

Common shares fully diluted. In accordance with GAAP, common shares used to calculate earnings per share are presented on a weighted average basis. Common shares on a fully diluted basis includes shares of common stock, Common units, and unvested shares of restricted stock outstanding at the end of the period on a share equivalent basis, because all shares are participating securities and thus share in the performance of the Company. The conversion of Series A preferred units is excluded from the calculation of common shares fully diluted as they are not participating securities, thus don’tand therefore do not share in the performance of the Company and their impact on shares outstanding is uncertain.

57

The following table sets forth a reconciliation of net income (loss) to FFO, AFFO and net income (loss) available to common stockholders per share to AFFO per share, fully diluted, the most directly comparable GAAP equivalents, respectively, for the periods indicated below (unaudited):

For the year ended December 31,

For the years ended December 31,

($ in thousands except per share data)

    

2020

    

2019

    

Net income (loss)

$

7,530

$

14,850

(Gain) loss on disposition of assets

(2,989)

(7,841)

Depreciation and depletion

 

7,972

 

8,320

(in thousands except per share amounts)

    

2023

    

2022

Net income

$

31,681

$

11,960

(Gain) on disposition of assets, net

(36,133)

(2,641)

Depreciation, depletion and amortization

 

7,499

6,960

Impairment of assets

 

5,840

FFO

 

12,513

 

15,329

$

8,887

$

16,279

Stock based compensation

 

1,060

 

1,527

Stock-based compensation and incentive

 

2,008

1,999

Deferred impact of interest rate swap terminations

 

519

 

198

 

 

582

Real estate related acquisition and due diligence costs

 

11

 

17

111

Distributions on preferred units

 

(12,334)

 

(12,486)

Distributions on Preferred units and stock

(2,970)

(3,210)

AFFO

$

1,769

$

4,370

$

8,140

$

15,761

AFFO per diluted weighted average share data:

AFFO weighted average common shares

 

31,534

 

32,938

 

51,810

 

52,531

Net income (loss) available to common stockholders

$

(0.18)

$

0.04

Income attributable to redeemable non-controlling interest and non-controlling interest in operating partnership

 

0.44

 

0.40

Depreciation and depletion

 

0.25

 

0.25

Stock based compensation

 

0.03

 

0.05

(Gain) loss on disposition of assets

 

(0.09)

 

(0.24)

Real estate related acquisition and due diligence costs

 

0.00

 

Distributions on preferred units

 

(0.39)

 

(0.37)

Net income available to common stockholders of Farmland Partners Inc.

$

0.55

$

0.16

Income available to redeemable non-controlling interest and non-controlling interest in operating partnership

0.08

 

 

0.08

Depreciation, depletion and amortization

 

0.14

 

0.13

Impairment of assets

 

0.11

 

0.00

Stock-based compensation and incentive

 

0.04

 

0.04

(Gain) on disposition of assets, net

(0.70)

(0.05)

Distributions on Preferred units and stock

 

(0.06)

(0.06)

AFFO per diluted weighted average share

$

0.06

$

0.13

$

0.16

$

0.30

The following table sets forth a reconciliation of AFFO share information to basic weighted average common shares outstanding, the most directly comparable GAAP equivalent, for the periods indicated below (unaudited):

    

For the year ended December 31,

($ in thousands)

2020

    

2019

    

Basic weighted average shares outstanding

 

29,376

30,169

 

Weighted average OP units on an as if converted basis

 

1,842

2,415

 

Weighted average unvested restricted stock

 

316

354

 

Weighted average redeemable non-controlling interest

 

AFFO weighted average common shares

 

31,534

 

32,938

 

As of December 31, 2020 and 2019 we had 32,210,063 and 31,856,400, shares of common stock and Common units outstanding on a fully diluted basis, respectively.

    

For the years ended December 31,

(in thousands)

    

2023

    

2022

Basic weighted average shares outstanding

 

50,243

 

 

50,953

Weighted average OP units on an as-if converted basis

 

1,220

 

 

1,292

Weighted average unvested restricted stock

 

347

 

 

286

AFFO weighted average common shares

 

51,810

 

 

52,531

EBITDAre

The Company calculates Earnings Before Interest Taxes Depreciation and Amortization for real estate (“EBITDAre”) in accordance with the standards established by NAREIT in its September 2017 White Paper. NAREIT defines EBITDAre as net income (calculated in accordance with GAAP) excluding interest expense, income tax, depreciation and amortization, gains or losses on disposition of depreciated property (including gains or losses on change of control),

58

impairment write-downs of depreciated property and of investments in unconsolidated affiliates caused by a decrease in value of depreciated property in the affiliate, and adjustments to reflect the entity’s pro rata share of EBITDAre of unconsolidated affiliates. EBITDAre is a key financial measure used to evaluate the Company’s operating performance but should not be construed as an alternative to operating income, cash flows from operating activities or net income, in each case as determined in accordance with GAAP. The Company believes that EBITDAre is a useful performance measure commonly reported and will be widely used by analysts and investors in the Company’s industry. However, while EBITDAre is a performance measure widely used across the Company’s industry, the Company does not believe that it correctly captures the Company’s business operating performance because it includes non-cash expenses and recurring adjustments that are necessary to better understand the Company’s business operating performance. Therefore, in addition to EBITDAre, management uses Adjusted EBITDAre, a non-GAAP measure.

58

We further adjust EBITDAre for certain additional items such as stock basedstock-based compensation and incentive, indirect offering costs, real estate acquisition related audit fees and real estate related acquisition and due diligence costs (for a full discussion of these adjustments, see AFFO adjustments discussed above) that we consider necessary to understand our operating performance. We believe that Adjusted EBITDAre provides useful supplemental information to investors regarding our ongoing operating performance that, when considered with net income and EBITDAre, is beneficial to an investor’s understanding of our operating performance.

EBITDAre and Adjusted EBITDAre have limitations as analytical tools, and you should not consider them in isolation or as a substitute for analysis of our results as reported under GAAP. Some of these limitations are:

EBITDAre and Adjusted EBITDAre do not reflect our cash expenditures, or future requirements, for capital expenditures or contractual commitments;
EBITDAre and Adjusted EBITDAre do not reflect changes in, or cash requirements for, our working capital needs;
EBITDAre and Adjusted EBITDAre do not reflect the interest expense, or the cash requirements necessary to service interest or principal payments, on our debt;
Although depreciation and amortization are non-cash charges, the assets being depreciated and amortized will often have to be replaced in the future, and EBITDAre and Adjusted EBITDAre do not reflect any cash requirements for these replacements; and
Other companies in our industry may calculate EBITDAre and Adjusted EBITDAre differently than we do, limiting the usefulness as a comparative measure.

Because of these limitations, EBITDAre and Adjusted EBITDAre should not be considered as a measure of discretionary cash available to us to invest in the growth of our business. We compensate for these limitations by relying primarily on our GAAP results of operations and using EBITDAre and Adjusted EBITDAre only as a supplemental measure of our performance.

The following table sets forth a reconciliation of our net income to our EBITDAre and Adjusted EBITDAre for the periods indicated below (unaudited):

For the year ended December 31,

($ in thousands)

    

2020

    

2019

    

Net income (loss)

$

7,530

$

14,850

Interest expense

 

17,677

 

19,588

Income tax expense

 

 

Depreciation and depletion

 

7,972

 

8,320

(Gain) loss on disposition of assets

(2,989)

(7,841)

EBITDAre

$

30,190

$

34,917

Stock based compensation

 

1,060

 

1,527

Real estate related acquisition and due diligence costs

 

11

 

Adjusted EBITDAre

$

31,261

$

36,444

59

Inflation

Most of our farming leases are two to three years for row crops and one to seven years for permanent crops, pursuant to which each tenant is responsible for substantially all of the operating expenses related to the property, including maintenance, water usage and insurance. As a result, we believe that the effect on us of inflationary increases in operating expenses may be offset in part by the operating expenses that are passed through to our tenants and by contractual rent increases because many of our leases will be renegotiated every one to five years.  We do not believe that inflation has had a material impact on our historical financial position or results of operations.

For the years ended December 31,

(in thousands)

    

2023

    

2022

Net income

$

31,681

$

11,960

Interest expense

22,657

 

16,143

Income tax (benefit) expense

(166)

 

227

Depreciation, depletion and amortization

7,499

 

6,960

Impairment of assets

5,840

 

(Gain) on disposition of assets, net

(36,133)

(2,641)

EBITDAre

$

31,378

$

32,649

Stock-based compensation and incentive

2,008

1,999

Real estate related acquisition and due diligence costs

17

111

Adjusted EBITDAre

$

33,403

$

34,759

Seasonality

Because the leases for a many of the properties in our portfolio require significant payments in advance of the spring planting season, we receive a significant portion of our cash rental payments in the first calendar quarter of each year, although weWe recognize rental revenue from thesefixed-rate farmland leases on a pro rata basis over the non-cancellable term of the lease in accordance with GAAP.accounting principles generally accepted in the United States (“GAAP”). Notwithstanding GAAP accounting requirements to spread rental revenue over the lease term, a significant portion of fixed rent is received in a lump sum before planting season, in the first quarter, and after harvest, in the fourth quarter. We receive a significant portion of our variable rental payments in the fourth calendar quarter of each year, following harvest, with only a portion of such payments being recognized ratably through the year in accordance with GAAP, in relation to crop insurance contracts entered into by our tenants. The highly seasonal nature of the agriculture industry causes seasonality in our business to some extent. Our financial performance should be evaluated on an annual basis, which eliminates impacts of seasonality and other similar factors that may cause our quarterly results to vary during the course of the year.

59

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market risk includes risks that arise from changes in interest rates, foreign currency exchange rates, commodity prices, equity prices and other market changes that affect market-sensitive instruments. In pursuing our business strategies, the primary market risk to which we are exposed is interest rate risk. Our primary interest rate exposure will be the daily LIBOR.SOFR. We may use fixed interest rate financing to manage our exposure to fluctuations in interest rates. On a limited basis, we also may use derivative financial instruments to manage interest rate risk. We willdo not use such derivatives for trading or other speculative purposes.

At December 31, 2020, $174.42023, $80.5 million, or 34%22.2%, of our debt had variable interest rates. Of our variable interest rate debt, $33.2 million representsrates, however, as stated in “Note 10—Hedge Accounting” to the notional amount onaccompanying consolidated financial statements, the Company has an interest rate swap agreement with oneRabobank for $33.2 million, which reduces floating rate exposure to $47.3 million. After adjusting the $33.2 million of our lenders that expires in 2023.swapped Rabobank debt as fixed rate debt, the ratio of floating rate debt to total debt decreased from 22.2% to 13.0%. Assuming no increase in the level of our variable rate debt spreads, if interest ratesSOFR increased by 1.0%, or 100 basis points, our cash flow would decrease by approximately $0.8$0.5 million per year, net of the notional amount on the swap agreement. At December 31, 2020, LIBOR was approximately 23 basis points. Assuming no increase in the level of our variable rate debt,and if LIBOR were reduced to 0 basis points,SOFR decreased by 1.0%, our cash flow would increase by approximately $0.9$0.5 million per year, net of the notional amount on the swap agreement.year.

Item 8. Financial Statements and Supplementary Data

Our consolidated financial statements and supplementary data are included as a separate section of this Annual Report on Form 10-K commencing on page F-1 and are incorporated herein by reference.

Item 9. Changes and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls and Procedures

Evaluation of Disclosure Controls and Procedures

We have established disclosure controls and procedures, as defined in Rule 13a-15(e) and 15d-15(e) under the Exchange Act, that are designed to ensure that information required to be disclosed by us in the reports that we file or submit under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the SEC’s rules and forms, and is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, as appropriate, to allow for timely decisions regarding disclosure. In designing and evaluating the disclosure controls and procedures, management recognizes that any controls and procedures, no matter how well designed and operated, can provide only reasonable assurance of achieving the desired control objectives, and management is required to apply its judgment in evaluating the cost-benefit relationship of possible controls and procedures. Accordingly,

60

even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives.

We have evaluated, under the supervision and with the participation of management, including our Chief Executive Officer and Chief Financial Officer, the effectiveness of our disclosure controls and procedures. Based upon their evaluation, our Chief Executive Officer and our Chief Financial Officer concluded that our disclosures and procedures were effective at a reasonable level of assurance as of the end of the period covered by this report.

Limitations on the Effectiveness of Controls

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions or that the degree of compliance with the policies or procedures may deteriorate.

60

Management’s Annual Report on Internal Controls over Financial Reporting

The Company’s management is responsible for establishing and maintaining adequate internal control over financial reporting, as such term is defined in Rules 13a-15(f) and 15d-15(f) of the Exchange Act. Under the supervision and with the participation of our management, including our Chief Executive Officer and Chief Financial Officer, we conducted an evaluation of the effectiveness of our internal control over financial reporting as of December 31, 20202023 based on the 2013 Internal Control-Integrated Framework issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO). Based on that evaluation, the Company’s management concluded that our internal controls over financial reporting were effective as of December 31, 2020.2023.

Changes in Internal Controls over Financial Reporting

There were no changes in the Company’s internal controls over financial reporting during the quarter ended December 31, 20202023 that have materially affected, or are reasonably likely to materially affect, the Company’s internal controls over financial reporting.

Item 9B. Other Information

None.

Rule 10b5-1 Trading Plans

During the year ended December 31, 2023, none of the Company’s directors or executive officers adopted or terminated any contract, instruction or written plan for the purchase or sale of the Company's securities that was intended to satisfy the affirmative defense conditions of Rule 10b5-1(c) or any “non-Rule 10b5-1 trading arrangement.”

Item 9C. Disclosure Regarding Foreign Jurisdictions that Prevent Inspections

Not applicable.

PART III

Item 10. Directors, Executive Officers and Corporate Governance

This information is incorporated by reference from the Company’s Proxy Statement with respect to the 20212024 Annual Meeting of Stockholders to be filed with the SEC no later than April 30, 2021.28, 2024.

Item 11. Executive Compensation

This information is incorporated by reference from the Company’s Proxy Statement with respect to the 20212024 Annual Meeting of Stockholders to be filed with the SEC no later than April 30, 2021.28, 2024.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

This information is incorporated by reference from the Company’s Proxy Statement with respect to the 20212024 Annual Meeting of Stockholders to be filed with the SEC no later than April 30, 2021.28, 2024.

61

Item 13. Certain Relationships and Related Transactions, and Director Independence

This information is incorporated by reference from the Company’s Proxy Statement with respect to the 20212024 Annual Meeting of Stockholders to be filed with the SEC no later than April 30, 2021.28, 2024.

61

Item 14. Principal Accountant Fees and Services

This information isInformation about aggregate fees billed to us by our principal accountant, Plante & Moran, PLLC, Denver, Colorado (PCAOB ID No. 166) will be incorporated by reference from the Company’s Proxy Statement with respect to the 20212024 Annual Meeting of Stockholders to be filed with the SEC no later than April 30, 2021.28, 2024.

PART IV

Item 15. Exhibits and Financial Statement Schedules

The following is a list of documents filed as a part of this report:

(1)Financial Statements

Included herein at pages F-1 through F-37.F-36.

(2)Financial Statement Schedules

The following financial statement schedule is included herein at pages F-38F-37 through F-45:F-41:

Schedule III—Combined Real Estate and Accumulated Depreciation

All other schedules for which provision is made in Regulation S-X are either not required to be included herein under the related instructions, are inapplicable or the related information is included in the footnotes to the applicable financial statement and, therefore, have been omitted.

(3)Exhibits

The exhibits required to be filed by Item 601 of Regulation S-K are listed in the Exhibit Index on pages 63, 64 and 65 of this report, which is incorporated by reference herein.

Item 16. Form 10-K Summary

The Company has elected to not include a summary.

62

Exhibit Index

Exhibit No

    

Description of Exhibit

3.1

Articles of Amendment and Restatement. (Incorporated by reference to Exhibit 3.1 to the Company’s Registration Statement on Form S-11/A, filed on March 24, 2014).

3.2

Articles Supplementary for Farmland Partners Inc. 6.00% Series B Participating Preferred Stock (Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed on August 16, 2017).

3.3

Second Amended and Restated Bylaws. (Incorporated by reference to Exhibit 3.1 to the Company’s Current Report on Form 8-K, filed on November 14, 2017).

4.1

Form of common stock certificatecertificate. (Incorporated by reference to Exhibit 4.1 to the Company’s Registration Statement on Form S-11/A, filed on March 11, 2014).

4.2

Form of Specimen Stock Certificate of 6.00% Series B Participating Preferred Stock (incorporated by reference to Exhibit 4.1 of the Company’s Registration Statement on Form 8-A, filed on August 16,2017)

4.3

*

Description of Securities Registered under Section 12 of the Exchange Act of Farmland Partners, Inc. (incorporated by reference to Exhibt 4.3 to the Company’s Annual Report on Form 10-K, filed on March 13, 2020).

10.1

Second Amended and Restated Agreement of Limited Partnership of Farmland Partners Operating Partnership, LP, dated April 16, 2014. (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on April 16, 2014).

10.2

Farmland Partners Inc. SecondThird Amended and Restated 2014 Equity Incentive Plan. (Incorporated by reference to Exhibit 10.210.1 to the Company’s Registration Statement on Form S-8, filed on May 5, 2015)10, 2021).

10.3

Form of Restricted Stock Award Agreement for Executive Officers. (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K, filed on March 9, 2018).

10.4

Form of Restricted Stock Award Agreement for Directors. (Incorporated by reference to Exhibit 10.4 to the Company’s Registration Statement on Form S-11/A, filed on March 11, 2014).

10.5

*

Indemnification Agreement by and between Farmland Partners Inc. and each of its directors and officers listed on Schedule A thereto.

10.6

Amended and Restated Employment Agreement, dated December 13, 2018, by and among Farmland Partners Inc., Farmland Partners Operating Partnership, LP and Paul A. Pittman. Incorporated(Incorporated by reference to Exhibit 10.6 to the Company’s Annual Report on Form 10-K filed on March 13, 2019).

10.7

Amended and Restated Employment Agreement, dated December 13, 2018, by and among Farmland Partners Inc., Farmland Partners Operating Partnership, LP and Luca Fabbri. (Incorporated by reference to Exhibit 10.7 to the Company’s Annual Report on Form 10-K filed on March 13, 2019).

10.8

First Amendment to Amended and Restated Pledge and SecurityEmployment Agreement, dated as of March 1, 2015,October 9, 2021, by and among Farmland Partners Inc., Farmland Partners Operating Partnership, LP Farmer Mac Mortgage Securities Corporation and Federal Agricultural Mortgage Corporation. (Incorporated by Reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on June 5, 2015)

10.9

Amended and Restated Bond Purchase Agreement, dated as of March 1, 2015, by and among Farmland Partners Inc., Farmland Partners Operating Partnership, LP, Farmer Mac Mortgage Securities Corporation and Federal Agricultural Mortgage Corporation. (Incorporated by Reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on June 5, 2015)

10.10

Amendment No. 1 to the Amended and Restated Bond Purchase Agreement, dated as of June 2, 2015, by and among Farmland Partners Inc., Farmland Partners Operating Partnership, LP, Farmer Mac Mortgage Securities Corporation and Federal Agricultural Mortgage Corporation. (Incorporated by Reference to Exhibit 10.3 to the Company’s Current Report on Form 8-K filed on June 5, 2015)

10.11

Amendment No. 2 to the Amended and Restated Bond Purchase Agreement, dated as of August 3, 2015.Luca Fabbri. (Incorporated by reference to Exhibit 10.2610.8 to the Company’s Annual Report on Form 10-K filed on February 23, 2017)28, 2022).

10.1210.9

Amendment No.1 to the Second Amended and Restated Agreement of Limited Partnership of Farmland Partners Operating Partnership, LP (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on March 3, 2016).

63

10.1310.10

Security Holder’s Agreement, dated as of March 2, 2016, by and among Forsythe Family Farms, Inc., Gerald R. Forsythe, Forsythe-Fournier Farms, LLC, Forsythe-Fawcett Farms, LLC, Forsythe-Bernadette Farms, LLC, Forsythe Land Company, Forsythe Family Farms, L.P., Forsythe Family Farms II, L.P., and Forsythe-Breslow Farms, LLC and Farmland Partners Inc. (Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on March 3, 2016).

10.1410.11

Amendment No. 1 to the Contribution Agreement, dated February 22, 2016, by and among Farmland Partners Inc., Farmland Partners Operating Partnership, LP, FPI Illinois I LLC, and FPI Illinois II, LLC and Forsythe Family Farms, Inc., Gerald R. Forsythe, Forsythe-Fournier Farms, LLC, Forsythe-Fawcett Farms, LLC, Forsythe-Bernadette Farms, LLC, Forsythe Land Company, Forsythe Family Farms, L.P., Forsythe Family Farms II, L.P., and Forsythe-Breslow Farms, LLC. (Incorporated by reference to Exhibit 10.3 to the Company’s Quarterly Report on Form 10-Q filed on May 10, 2016).

10.1510.12

Loan Agreement, dated as of March 29, 2016, between FPI Illinois I LLC, FPI Illinois II LLC, Cottonwood Valley Land LLC, PH Farms LLC and FPI Properties LLC and Metropolitan Life Insurance Company. (Incorporated by reference to Exhibit 10.7 to the Company’s Quarterly Report on Form 10-Q filed on May 10, 2016).

10.1610.13

Guaranty, dated as of March 29, 2016, by Farmland Partners Operating Partnership, LP in favor of Metropolitan Life Insurance Company. (Incorporated by reference to Exhibit 10.8 to the Company’s Quarterly Report on Form 10-Q filed on May 10, 2016).

63

10.1710.14

Amended and Restated Employment Agreement, dated as of February 6, 2019,October 9, 2021, by and among Farmland Partners Inc., Farmland Partners Operating Partnership, LP and Erica Borenstein.James Gilligan. (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on FebruaryOctober 12, 2019)2021).

10.1810.15

Registration Rights Agreement, dated as of February 2, 2017, by and between Farmland PartneresPartners Inc. and each of the holders named therein. (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on February 3, 2017).

10.19

Amended and Restated Sub-Advisory Agreement, by and among American Farmland Company, American Farmland Company L.P., American Farmland Advisor LLC and Prudential Mortgage Capital Company, LLC. (Incorporated by reference to Exhibit 10.7 to American Farmland Company’s Registration Statement on Form S-11 (File No. 333-205260) filed on June 26, 2015)

10.20

Loan Agreement, dated as of December 5, 2013, by and between American Farmland Company L.P. and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.28 to American Farmland Company’s Annual Report on Form 10-K filed on March 30, 2016)

10.21

Loan Agreement, dated as of January 14, 2015, by and between American Farmland Company L.P. and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.29 to American Farmland Company’s Annual Report on Form 10-K filed on March 30, 2016)

10.22

Loan Agreement, dated as of August 18, 2015, by and between American Farmland Company L.P. and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.30 to American Farmland Company’s Annual Report on Form 10-K filed on March 30, 2016)

10.23

Loan Agreement, dated as of December 22, 2015, by and between American Farmland Company L.P. and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.1 to American Farmland Company’s Current Report on Form 8-K filed on December 29, 2015)

10.24

Amendment to Loan Agreements, dated as of December 22, 2015, by and between American Farmland Company L.P. and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.2 to American Farmland Company’s Current Report on Form 8-K filed on December 29, 2015)

10.25

Second Amendment to Loan Agreements, dated as of February 3, 2017, by and between American Farmland Company L.P. and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.8 to the Company’s Current Report on Form 8-K filed on February 3, 2017)

10.26

Guaranty, dated as of February 3, 2017, by and between Farmland Partners Inc. and Ruledge Investment Company. (Incorporated by reference to Exhibit 10.9 to the Company’s Current Report on Form 8-K filed on February 3, 2017)

10.27

Guaranty, dated as of February 3, 2017, by and between Farmland Partners Operating Partnership, LP and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.10 to the Company’s Current Report on Form 8-K filed on February 3, 2017)

64

10.28

Loan Agreement, dated as of February 3, 2017, by and between American Farmland Company L.P and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.11 to the Company’s Current Report on Form 8-K filed on February 3, 2017)

10.29

Guaranty, dated as of February 3, 2017, by and between Farmland Partners Inc. and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.12 to the Company’s Current Report on Form 8-K filed on February 3, 2017)

10.30

Guaranty, dated as of February 3, 2017, by and between Farmland Partners Operating Partnership, LP and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.13 to the Company’s Current Report on Form 8-K filed on February 3, 2017)

10.31

Second Amended and Restated Farmland Partners Inc. 2014 Equity Incentive Plan (Incorporated by reference to Exhibit 10.1 to the Company’s Registration Statement on Form S-8 filed on May 4, 2017)

10.3210.16

Amendment No. 2 to the Second Amended and Restated Partnership Agreement of Farmland Partners Operating Partnership, LP (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on August 16, 2017).

10.3310.17

Amendment No. 3 to the Second Amended and Restated Partnership Agreement of Farmland Partners Operating Partnership, LP (Incorporated by reference to Exhibit 10.1 the Company’s Quarterly Report on Form 10-Q filed November 12, 2019).

10.3410.18

Lease Agreement, dated November 17, 2017, by and between Arnold (CA) LLC and Olam Farming, Inc. (Incorporated by reference to Exhibit 10.40 to the Company’s Annual Report on Form 10-K filed March 15, 2019).

10.35*10.19

Master Real Estate Purchase Agreement, dated as of January 20, 2021, by and between Farmland Partners Operating Partnership, LP and each of the sellers set forth on AttachementAttachment A and Promised Land OprotunityOpportunity Zone Farms I, LLC. (Incorporated by reference to Exhibit 10.35 to the Company’s Annual Report on Form 10-K filed March 19, 2021).

10.36*10.20

Loan Agreement, dated as of October 29, 2020, by and between FPI Carolinas LLC, FPI Colorado LLC, Cottonwood Valley Land LLC, PH Farms LLC, FPI Ironwood LLC and FPI Properties LLC and Metropolitan Life Insurance Company. (Incorporated by reference to Exhibit 10.36 to the Company’s Annual Report on Form 10-K filed March 19, 2021).

10.21

Amended, Restated and Consolidated Loan Agreement, dated as of February 18, 2022, by and between, Farmland Partners Inc., Farmland Partners Operating Partnership, LP, American Farmland Company L.P., and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.26 to the Company's Annual Report on Form 10-K filed on February 28, 2022).

10.22

Amended and Restated Guaranty Agreement, dated as of February 18, 2022, by and between Farmland Partners Inc. and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.27 to the Company's Annual Report on Form 10-K filed on February 28, 2022).

10.23

Amended and Restated Guaranty Agreement, dated as of February 18, 2022, by and between Farmland Partners Operating Partnership, LP and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.28 to the Company's Annual Report on Form 10-K filed on February 28, 2022).

10.24

Consolidation of Notes and Modification and Extension Agreement, dated as of February 18, 2022, by and between American Farmland Company L.P. and Rutledge Investment Company. (Incorporated by reference to Exhibit 10.29 to the Company's Annual Report on Form 10-K filed on February 28, 2022).

10.25

Loan Agreement, dated as of October 13, 2022, by and between FPI Illinois I LLC, PH Farms LLC and Brighthouse Life Insurance Company. (Incorporated by reference to Exhibit 10.1 to the Company's Current Report on Form 8-K filed on October 14, 2022).

10.26

Guaranty, dated as of October 13, 2022, by Farmland Partners Inc. in favor of Brighthouse Life Insurance Company. (Incorporated by reference to Exhibit 10.2 to the Company's Current Report on Form 8-K filed on October 14, 2022).

10.27

Guaranty, dated as of October 13, 2022, by Farmland Partners Operating Partnership, L.P. in favor of Brighthouse Life Insurance Company. (Incorporated by reference to Exhibit 10.3 to the Company's Current Report on Form 8-K filed on October 14, 2022).

10.28

Second Amended and Restated Bond Purchase Agreement, dated as of December 22, 2022, by and among Farmland Partners Inc., Farmland Partners Operating Partnership, LP, Farmer Mac Mortgage Securities Corporation and Federal Agricultural Mortgage Corporation. (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed on December 23, 2022).

10.29

Guaranty Agreement, dated as of December 22, 2022, by and among Farmland Partners Inc. Farmer Mac Mortgage Securities Corporation and Federal Agricultural Mortgage Corporation. (Incorporated by reference to Exhibit 10.2 to the Company’s Current Report on Form 8-K filed on December 23, 2022).

64

10.30

Letter Agreement, dated December 30, 2022, by and between Farmland Partners Inc., Farmland Partners Operating Partnership, LP, FPI Agribusiness, Inc. and Murray R. Wise. (Incorporated by reference to Exhibit 10.1 to the Company’s Current Report on Form 8-K filed January 5, 2023).

21.1

*

List of subsidiaries.

23.1

*

Consent of Plante & Moran, PLLC.

31.1

*

Certification of Chief Executive Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

31.2

*

Certification of Chief Financial Officer pursuant to Rule 13a-14(a)/15d-14(a) of the Securities Exchange Act of 1934, as amended, as adopted pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.

32.1

*

Certification of Chief Executive Officer and Chief Financial Officer pursuant to 18 U.S.C. 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

101.INS

97.1

Inline XBRL Instance Document**

Farmland Partners Inc. Compensation Recoupment Policy.

101.SCH101

*

The following materials from the Company’s Annual Report on Form 10-K for the year ended December 31, 2023, were formatted in Inline XBRL Taxonomy Extension Schema*

101.CAL

(Extensible Business Reporting Language): (i) Consolidated Balance Sheets, (ii) Consolidated Statements of Operations, (iii) Consolidated Statements of Comprehensive Income, (iv) Consolidated Statements of Equity, (v) Consolidated Statements of Cash Flows, and (vi) Notes to Consolidated Financial Statements. The instance document does not appear in the Interactive Data File because its XBRL tags are embedded within the Inline XBRL Taxonomy Extension Calculation Linkbase*

101.DEF

Inline XBRL Taxonomy Extension Definition Linkbase*

101.LAB

Inline XBRL Taxonomy Extension Label Linkbase*

101.PRE

Inline XBRL Taxonomy Extension Presentation Linkbase*document.

104

*

Cover Page Interactive Data File (formatted as– the cover page XBRL tags are embedded within the Inline XBRL and contained in Exhibit 101)*XBRL.

* Filed herewith

Management contract or compensatory plan or arrangement.

65

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Date: March 19, 2021

FARMLAND PARTNERS INC.

Date: February 29, 2024

/s/ LUCA FABBRI

By:

/s/ Paul A. PittmanLuca Fabbri

Paul A. Pittman

Executive ChairmanPresident and Chief Executive Officer

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.

Signature

Title

Date

/s/ Paul A. PittmanLuca Fabbri

Executive Chairman, President and Chief Executive Officer (principal executive officer)

March 19, 2021February 29, 2024

Paul A. PittmanLuca Fabbri

/s/ Luca FabbriJames Gilligan

Chief Financial Officer and Treasurer (principal financial officer and principal accounting officer)

March 19, 2021February 29, 2024

Luca FabbriJames Gilligan

/s/ Paul A. Pittman

Executive Chairman

February 29, 2024

Paul A. Pittman

/s/ Chris A. Downey

Director

March 19, 2021February 29, 2024

Chris A. Downey

/s/ Joseph W. Glauber

Director

March 19, 2021February 29, 2024

Joseph W. Glauber

/s/ John A. Good

Director

March 19, 2021February 29, 2024

John A. Good

/s/ Thomas P. HeneghanJennifer S. Grafton

Director

March 19, 2021February 29, 2024

Thomas P. HeneghanJennifer S. Grafton

/s/ Toby L. O'RourkeDanny D. Moore

Director

March 19, 2021February 29, 2024

Toby L. O'RourkeDanny D. Moore

66

Farmland Partners Inc.

FORM 10-K FOR THE YEAR ENDED

December 31, 20202023

TABLE OF CONTENTS

 

 

Page

 

 

 

Item 8.

Financial Statements.

 

 

 

 

 

Consolidated Financial Statements

 

Report of Independent Registered Public Accounting Firm

F-1

 

Balance Sheets as of December 31, 20202023 and 20192022

F-3

 

Statements of Operations for the years ended December 31, 20202023 and 20192022

F-4

Statements of Comprehensive Income for the years ended December 31, 20202023 and 20192022

F-5

Statements of Equity for the years ended December 31, 20202023 and 20192022

F-6

 

Statements of Cash Flows for the years ended December 31, 20202023 and 20192022

F-7

 

Notes to Consolidated Financial Statements

F-9

 

Schedule III – Real Estate and Accumulated Depreciation as of December 31, 20202023

F-38F-37

Note: All other schedules have been omitted because the required information is not present or not present in amounts sufficient to require submission of the schedule, or because the information required is included in the financial statements or notes thereto.

Report of Independent Registered Public Accounting Firm

To the Stockholders and Board of Directors of Farmland Partners Inc.

Opinion on the Consolidated Financial Statements

We have audited the accompanying consolidated balance sheets of Farmland Partners Inc. (the “Company”) as of December 31, 20202023 and 20192022, the related consolidated statements of operations, comprehensive income, stockholders' equity, and cash flows for each of the years in the two-year period ended December 31, 2020,2023, and the related notes and schedule (collectively referred to as the “financial statements”). In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of the Company as of December 31, 20202023 and 2019,2022, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2020,2023, in conformity with accounting principles generally accepted in the United States of America.

Basis for Opinion

The Company's management is responsible for these financial statements. Our responsibility is to express an opinion on the Company’s financial statements based on our audits. We are a public accounting firm registered with the Public Company Accounting Oversight Board (United States) (“PCAOB”) and are required to be independent with respect to the Company in accordance with the U.S. federal securities laws and the applicable rules and regulations of the Securities and Exchange Commission and the PCAOB.

We conducted our audits in accordance with the standards of the PCAOB. Those standards require that we plan and perform the auditsaudit to obtain reasonable assurance about whether the financial statements are free of material misstatement, whether due to error or fraud. The Company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. As part of our audits, we are required to obtain an understanding of internal control over financial reporting but not for the purpose of expressing an opinion on the effectiveness of the Company's internal control over financial reporting. Accordingly, we express no such opinion.

Our audits included performing procedures to assess the risks of material misstatement of the financial statements, whether due to error or fraud, and performing procedures that respond to those risks. Such procedures included examining, on a test basis, evidence regarding the amounts and disclosures in the financial statements. Our audits also included evaluating the accounting principles used and significant estimates made by management, as well as evaluating the overall presentation of the financial statements. We believe that our audits provide a reasonable basis for our opinion.

Critical Audit Matter

The critical audit matter communicated below is a matter arising from the current period audit of the financial statements that was communicated or required to be communicated to the audit committee and that (1) relates to accounts or disclosures that are material to the financial statements and (2) involved our especially challenging, subjective, or complex judgments. The communication of critical audit matters does not alter in any way our opinion on the financial statements, taken as a whole, and we are not, by communicating the critical audit matter below, providing a separate opinionsopinion on the critical audit matter or on the accounts or disclosures to which it relates.

Hedge Accounting Applied to Interest Rate Swap of a Designated Cash Flow Hedging RelationshipGoodwill and Tradename – Refer to Note 121 to the Consolidated Financial Statements

financial statements

Critical Audit Matter Description

As describeddiscussed in Note 121 to the consolidated financial statements, goodwill and tradename are indefinite lived assets tested at least annually for impairment. Goodwill and tradename have balances of $2.7 million and $1.8 million, respectively, at December 31, 2023. For goodwill, management compares the Company designates qualifying derivative instruments as cash flow hedges. During 2020, the Company terminated its existing interest rate swapestimated fair value of

F-1

agreement that was designatedthe reporting unit to its carrying value. The fair value of the reporting unit is calculated using the expected present value of future cash flows method and includes significant assumptions such as afuture cash flow hedgeflows, discount rates and entered into a new interest rate swap agreement to obtain a more favorable interest rate and manage interest rate risk exposure. Accordingly,future capital requirements. Management evaluates the Company de-designated the cash flow hedge relationshipacquired tradename for the terminated interest rate swap agreement and began amortizingimpairment by comparing the fair value of the de-designated swapasset to its carrying value. The fair value of $2.6 million over the original termtradename is determined using a forward curve analysis to determine monthly amortization. The Company designated the new interest rate agreementexpected present value of future cash flows method and includes significant assumptions such as afuture cash flow hedgeflows, discount rates and assessed the effectiveness at inception using regression analysis.

royalty rate. We identified hedge accountingthe evaluation of goodwill and tradename for this transactionimpairment as a critical audit matter. Accounting for the termination and entry into a new interest rate swap resulting in de-designationmatter because of the previous hedging relationshipsignificant estimates and designation of the new hedging relationship related to the interest rate swap required significant judgmentassumptions used by management and resulted in significant accounting estimates being applied to the transaction, including the method of amortizing the frozen accumulated other comprehensive loss on the previous hedging relationship, the assessment of the effectiveness of the new hedging relationship, as well as the related presentation and disclosure associated with the transaction. This led todetermining their fair value which required a high degree of auditor judgment and an increased extent of effort when performingthe need to involve our fair value specialists in our audit procedures to evaluate the methodologythese significant estimates and the reasonableness of related assumptions, as well as the inputs and related calculations in evaluating managements estimates. It also required professionals with specialized skills and knowledge to evaluate these assumptions and their impact on the financial statements, including related presentation and disclosure matters.

assumptions.

How the Critical Audit Matter Waswas Addressed in the Audit

OurAddressing these matters involved performing procedures and evaluating audit evidence in connection with forming our overall opinion on the consolidated financial statements. These procedures related to designated cash flow hedging relationships included, the following, among others:

others,

We gainedObtaining an understanding of accounting and control procedures over management's process for estimating the designfair value of the controls overreporting unit and the Company's derivative contracts and hedging relationships, including those to develop key management estimates.fair value of the indefinite-lived tradename.
We testedEvaluating management’s process for determiningdeveloping the amount of frozen other comprehensive loss and the methodology applied to amortize the balancefair value of the cumulative comprehensive loss on the de-designated hedging relationship into earnings in future periods.

With the assistance of our fair value specialists, we evaluated the Company’s determination of hedge effectiveness through regression analysis for reasonableness: our specialists developed an independent expectation of interest rate swap valuationreporting unit and compared our independent expectation to the Company’s regression analysis, noting that we were in agreement with management’s conclusion that the hedging relationship was highly effective.

With the assistance of our fair value specialists, we evaluatedtradename, including the appropriateness of specified inputs supporting management’s estimatethe valuation methodology, testing the completeness, accuracy, and relevance of underlying data used in the calculation, and testing the reasonableness of significant assumptions, including the discount rate and expected future net cash flows.
Evaluating the reasonableness of the fair valuesexpected future net cash flows involved considering whether assumptions for future cash flows and margins were reasonable and consistent with the current performance of the interest rate swaps,reporting unit, with operating trends, the original third-party valuation, and internal accounting records.
Using professionals with specialized skill and knowledge to assist in evaluating the reasonableness of significant assumptions, including the adjustmentdiscount rate and, for credit risk,the tradename, the royalty rate, by comparing them against discount rate and we evaluatedroyalty rate ranges that were independently developed using publicly available market data for comparable companies, performing independent calculations of the appropriatenessweighted-average cost of capital and consistencyperforming sensitivity analyses of management’s methods andthese significant assumptions usedto evaluate the changes in developing their estimates.the fair value of the reporting unit that would result from changes in these assumptions.

We reviewedEvaluating the overall presentationCompany's disclosures related to the goodwill and disclosure of the transaction in the consolidated financial statements to determine all required disclosures were complete, clear and transparent and that the presentation of the transaction was appropriate.indefinite lived intangibles accounting policy.

/s/ Plante & Moran, PLLC

We have served as the Company’s auditor since 2018.

Denver, Colorado

March 19 2021February 29, 2024

F-2

Farmland Partners Inc.

Consolidated Balance Sheets

($ in thousands, except par value and share data)

December 31,

 

    

2020

    

2019

 

ASSETS

Land, at cost

$

924,952

937,813

Grain facilities

 

12,091

12,091

Groundwater

 

10,214

11,473

Irrigation improvements

 

53,887

53,871

Drainage improvements

 

12,805

12,674

Permanent plantings

54,374

52,089

Other

8,167

7,827

Construction in progress

 

9,284

11,911

Real estate, at cost

 

1,085,774

 

1,099,749

Less accumulated depreciation

 

(32,654)

(25,277)

Total real estate, net

 

1,053,120

 

1,074,472

Deposits

 

1

Cash

 

27,217

12,561

Notes and interest receivable, net

 

2,348

4,767

Right of Use Asset

93

73

Deferred financing fees, net

87

174

Accounts receivable, net

 

4,120

5,515

Inventory

 

1,117

1,550

Prepaid expenses and other assets

 

2,889

3,440

TOTAL ASSETS

$

1,090,991

$

1,102,553

LIABILITIES AND EQUITY

LIABILITIES

Mortgage notes and bonds payable, net

$

506,625

511,403

Lease Liability

93

73

Dividends payable

 

1,612

1,593

Derivative liability

2,899

1,644

Accrued interest

 

3,446

3,111

Accrued property taxes

 

1,817

1,873

Deferred revenue

 

37

71

Accrued expenses

 

8,272

5,868

Total liabilities

 

524,801

 

525,636

Commitments and contingencies (See Note 8)

Series B Participating Preferred Stock, $0.01 par value, $25.00 per share liquidation preference; 6,037,500 shares authorized; 5,831,870 shares issued and outstanding at December 31, 2020, and 5,972,059 shares issued and outstanding at December 31, 2019

139,766

142,861

Redeemable non-controlling interest in operating partnership, preferred units

120,510

120,510

EQUITY

Common stock, $0.01 par value, 500,000,000 shares authorized; 30,571,271 shares issued and outstanding at December 31, 2020, and 29,952,608 shares issued and outstanding at December 31, 2019

 

297

292

Additional paid in capital

 

345,870

338,387

Retained earnings

 

1,037

6,251

Cumulative dividends

 

(54,751)

(48,784)

Other comprehensive income

 

(2,380)

(1,644)

Non-controlling interests in operating partnership

 

15,841

19,044

Total equity

 

305,914

 

313,546

TOTAL LIABILITIES, REDEEMABLE NON-CONTROLLING INTEREST IN OPERATING PARTNERSHIP AND EQUITY

$

1,090,991

$

1,102,553

December 31,

December 31,

    

2023

    

2022

ASSETS

Land, at cost

$

869,848

$

980,521

Grain facilities

 

12,222

 

11,349

Groundwater

 

11,472

 

17,682

Irrigation improvements

 

41,988

 

50,097

Drainage improvements

 

10,315

 

12,543

Permanent plantings

39,620

50,394

Other

4,696

 

6,967

Construction in progress

 

4,453

 

14,810

Real estate, at cost

 

994,614

 

1,144,363

Less accumulated depreciation

 

(33,083)

 

(38,447)

Total real estate, net

 

961,531

 

1,105,916

Deposits

 

426

 

148

Cash and cash equivalents

 

5,489

 

7,654

Assets held for sale

28

33

Loans and financing receivables, net

 

31,020

 

21,921

Right of use asset

399

325

Deferred offering costs

 

 

63

Accounts receivable, net

 

7,743

 

7,055

Derivative asset

1,707

2,084

Inventory

 

2,335

 

2,808

Equity method investments

4,136

 

4,185

Intangible assets, net

2,035

2,055

Goodwill

2,706

2,706

Prepaid and other assets

 

2,447

 

3,196

TOTAL ASSETS

$

1,022,002

$

1,160,149

LIABILITIES AND EQUITY

LIABILITIES

Mortgage notes and bonds payable, net

$

360,859

$

436,875

Lease liability

399

325

Dividends payable

 

13,286

 

3,333

Accrued interest

 

4,747

 

4,135

Accrued property taxes

 

1,898

 

2,008

Deferred revenue

 

2,149

 

44

Accrued expenses

 

7,854

 

9,215

Total liabilities

 

391,192

 

455,935

Commitments and contingencies (See Note 8)

Redeemable non-controlling interest in operating partnership, Series A preferred units

101,970

110,210

EQUITY

Common stock, $0.01 par value, 500,000,000 shares authorized; 48,002,716 shares issued and outstanding at December 31, 2023, and 54,318,312 shares issued and outstanding at December 31, 2022

 

466

 

531

Additional paid in capital

 

577,253

 

647,346

Retained earnings

 

31,411

 

3,567

Cumulative dividends

 

(95,939)

 

(73,964)

Other comprehensive income

 

2,691

 

3,306

Non-controlling interests in operating partnership

 

12,958

 

13,218

Total equity

 

528,840

 

594,004

TOTAL LIABILITIES, REDEEMABLE NON-CONTROLLING INTERESTS IN OPERATING PARTNERSHIP AND EQUITY

$

1,022,002

$

1,160,149

See accompanying notes.

F-3

Farmland Partners Inc.

Consolidated Statements of Operations

(in thousands, except per share amounts)

For the Years Ended December 31,

For the Years Ended

    

2020

    

2019

    

December 31,

OPERATING REVENUES

    

2023

    

2022

OPERATING REVENUES:

Rental income

$

43,693

$

48,119

$

49,185

$

48,879

Tenant reimbursements

 

3,637

 

3,146

Crop Sales

1,902

978

Crop sales

2,257

5,372

Other revenue

 

1,457

 

1,321

 

6,024

 

6,959

Total operating revenues

 

50,689

 

53,564

 

57,466

 

61,210

OPERATING EXPENSES

Depreciation and depletion

 

7,972

 

8,320

Depreciation, depletion and amortization

 

7,499

 

6,960

Property operating expenses

 

7,350

 

7,897

 

8,660

 

8,190

Cost of goods sold

3,387

927

4,754

5,966

Acquisition and due diligence costs

 

11

 

6

 

17

 

111

General and administrative expenses

 

5,896

 

6,102

 

11,274

 

12,005

Legal and accounting

 

3,742

 

3,971

 

1,279

 

2,874

Impairment of assets

5,840

Other operating expenses

2

4

144

130

Total operating expenses

 

28,360

 

27,227

 

39,467

 

36,236

OPERATING INCOME

 

22,329

 

26,337

OTHER (INCOME) EXPENSE:

Other income

111

(260)

(Gain) loss on disposition of assets

(2,989)

(7,841)

Other (income)

(39)

(663)

(Income) from equity method investment

(1)

(52)

(Gain) on disposition of assets, net

(36,133)

(2,641)

Interest expense

 

17,677

 

19,588

 

22,657

16,143

Total other expense

 

14,799

 

11,487

 

(13,516)

 

12,787

Net income before income tax expense

7,530

14,850

Net income before income tax (benefit) expense

31,515

12,187

Income tax expense

 

Income tax (benefit) expense

(166)

 

227

NET INCOME

 

7,530

 

14,850

 

31,681

 

11,960

Net income attributable to non-controlling interest in operating partnership

 

(411)

 

(964)

Net (income) attributable to non-controlling interests in operating partnership

 

(768)

(286)

Net income attributable to the Company

$

7,119

$

13,886

30,913

11,674

Nonforfeitable distributions allocated to unvested restricted shares

(64)

(77)

(157)

(63)

Distributions on redeemable non-controlling interests in operating partnership, preferred units

(12,334)

(12,485)

Distributions on Series A Preferred Units

(2,970)

(3,210)

Net (loss) income available to common stockholders of Farmland Partners Inc.

$

(5,279)

$

1,324

Net income available to common stockholders of Farmland Partners Inc.

$

27,786

$

8,401

Basic and diluted per common share data:

Basic net (loss) income available to common stockholders

$

(0.18)

$

0.04

Diluted net (loss) income available to common stockholders

$

(0.18)

$

0.04

Distributions declared per common share

$

0.2000

$

0.2000

Basic net income available to common stockholders

$

0.55

$

0.16

Diluted net income available to common stockholders

$

0.53

$

0.16

Basic weighted average common shares outstanding

 

29,376

 

30,169

 

50,243

 

50,953

Diluted weighted average common shares outstanding

 

29,376

 

30,169

 

58,292

 

50,953

Dividends declared per common share

$

0.24

$

0.23

See accompanying notes.

F-4

Farmland Partners Inc.

Consolidated Statements of Comprehensive Income

(in thousands)

For the Twelve Months Ended

For the Years Ended

December 31,

December 31,

    

2020

    

2019

    

2023

    

2022

Net Income

$

7,530

$

14,850

Amortization of OCI

846

Net income

$

31,681

$

11,960

Amortization of other comprehensive income

198

594

Net change associated with current period hedging activities

 

(1,582)

 

(779)

(813)

2,433

Comprehensive Income

 

6,794

 

14,071

Comprehensive income attributable to non-controlling interests

 

(411)

 

(964)

Comprehensive income

31,066

14,987

Comprehensive (loss) attributable to non-controlling interests

(768)

(286)

Net income attributable to Farmland Partners Inc.

$

6,383

$

13,107

$

30,298

$

14,701

See accompanying notes.

F-5

Farmland Partners Inc.

Consolidated Statements of Equity

(in thousands)

Stockholders’ Equity

Common Stock

Non-controlling

    

    

    

Additional

    

Retained

    

    

Other

Interest in

    

Paid-in

Earnings

Cumulative

Comprehensive

Operating

Total

    

Shares

    

Par Value

    

Capital

    

(Deficit)

    

Dividends

    

Income

Partnership

    

Equity

Balance at December 31, 2018

30,594

300

332,996

4,852

(42,695)

(865)

44,685

339,273

Net income

 

13,885

965

14,850

Issuance of stock (write off of deferred offering costs)

 

(218)

(218)

Grant of unvested restricted stock

 

226

Forfeiture of unvested restricted stock

 

(25)

(99)

(99)

Stock based compensation

 

2

1,527

1,527

Dividends accrued or paid

 

(12,486)

(6,089)

(430)

(19,005)

Conversion of common units to shares of common stock

 

2,678

27

26,217

(26,244)

Net change associated with current period hedging transactions

 

(779)

(779)

Repurchase and cancellation of shares

 

(3,523)

(35)

(21,968)

(22,003)

Adjustment to non-controlling interest resulting from changes in ownership of the Operating Partnership

 

(68)

68

Balance at December 31, 2019

 

29,952

292

338,387

6,251

(48,784)

(1,644)

19,044

313,546

Net income

7,118

411

7,529

Issuance of stock

1,250

12

9,988

10,000

Grant of unvested restricted stock

139

Forfeiture of unvested restricted stock

(1)

Stock based compensation

1,060

1,060

Dividends accrued or paid

(12,332)

(5,967)

(368)

(18,667)

Conversion of common units to shares of common stock

265

3

2,974

(2,976)

1

Net change associated with current period hedging transactions

(736)

(736)

Repurchase and cancellation of shares

(1,034)

(10)

(6,809)

(6,819)

Adjustment to non-controlling interest resulting from changes in ownership of the Operating Partnership

270

(270)

Balance at December 31, 2020

30,571

$

297

$

345,870

$

1,037

$

(54,751)

$

(2,380)

$

15,841

$

305,914

Stockholders’ Equity

Non-controlling

Common Stock

Other

Interests in

Paid in

Retained

Cumulative

Comprehensive

Operating

Total

  

Shares

  

Par Value

  

Capital

Earnings (Deficit)

  

Dividends

  

Income

  

Partnership

  

Equity

Balance at December 31, 2021

45,474

$

444

$

524,183

$

(4,739)

$

(61,853)

$

279

$

13,762

$

472,076

Net income

11,674

286

11,960

Issuance of stock

8,599

86

121,289

121,375

Grant of unvested restricted stock

150

Forfeiture of unvested restricted stock

(10)

Shares withheld for income taxes on vesting of equity-based compensation

(15)

(186)

(186)

Stock-based compensation

1,523

1,523

Dividends accrued and paid

(3,368)

(12,111)

(292)

(15,771)

Conversion of common units to shares of common stock

120

1

1,319

(1,320)

Net change associated with current period hedging transactions and amortization of other comprehensive income

3,027

3,027

Adjustments to non-controlling interests resulting from changes in ownership of operating partnership

(782)

782

Balance at December 31, 2022

54,318

$

531

$

647,346

$

3,567

$

(73,964)

$

3,306

$

13,218

$

594,004

Net income

30,913

768

31,681

Issuance of stock

14

155

155

Grant of unvested restricted stock

226

Forfeiture of unvested restricted stock

(1)

Shares withheld for income taxes on vesting of equity-based compensation

(4)

(43)

(43)

Stock-based compensation

1,853

1,853

Dividends accrued and paid

(3,069)

(21,975)

(546)

(25,590)

Net change associated with current period hedging transactions and amortization of other comprehensive (loss)

(615)

(615)

Repurchase and cancellation of shares

(6,550)

(65)

(72,107)

(433)

(72,605)

Adjustments to non-controlling interests resulting from changes in ownership of operating partnership

49

(49)

Balance at December 31, 2023

48,003

$

466

$

577,253

$

31,411

$

(95,939)

$

2,691

$

12,958

$

528,840

See accompanying notes.

F-6

Farmland Partners Inc.

Consolidated Statements of Cash Flows

(in thousands)

For the Years Ended December 31,

    

2020

    

2019

CASH FLOWS FROM OPERATING ACTIVITIES

Net income

$

7,530

$

14,850

Adjustments to reconcile net income to net cash provided by operating activities:

Depreciation and depletion

 

7,972

 

8,320

Amortization of discounts/premiums on debt

 

308

 

321

Amortization of net origination fees related to notes receivable

(1)

Stock based compensation, net of forfeitures

 

1,060

 

1,428

(Gain) loss on disposition of assets

 

(2,989)

 

(7,841)

Proceeds from litigation insurance

500

Bad debt expense

233

542

Loss on settlement of interest rate swap

846

Changes in operating assets and liabilities:

Decrease (increase) in accounts receivable

 

1,203

 

1,260

Decrease (increase) in interest receivable

61

(806)

Decrease (increase) in other assets

 

294

 

(103)

Decrease (increase) in inventory

433

 

(1,264)

Increase (decrease) in accrued interest payable

 

204

 

(1,242)

Incrase in accrued expenses

 

1,962

 

2,417

Increase (decrease) in deferred revenue

 

138

 

(114)

Increase (decrease) in accrued property taxes

 

(29)

 

227

Net cash provided by operating activities

 

19,726

 

17,994

CASH FLOWS FROM INVESTING ACTIVITIES

Real estate acquisitions

 

(919)

 

(1,403)

Real estate improvements

 

(2,655)

 

(6,583)

Principal receipts on notes receivable

1,772

6,679

Issuance of notes receivable

 

(8)

 

(1,781)

Proceeds from sale of property

 

20,478

 

34,140

Net cash provided by investing activities

 

18,668

 

31,052

CASH FLOWS FROM FINANCING ACTIVITIES

Borrowings from mortgage notes payable

54,361

 

Repayments on mortgage notes payable

(59,027)

 

(11,385)

Common stock repurchased

(6,819)

(22,003)

Participating preferred stock repurchased

(3,095)

(896)

Payment of debt issuance costs

(332)

 

Payment of swap fees

(182)

 

Proceeds from issuance of common stock

10,000

Dividends on common stock

(5,942)

 

(6,177)

Dividends on Series A preferred units

(3,510)

(3,510)

Dividends on Series B participating preferred stock

(8,824)

(8,975)

Distributions to non-controlling interest in operating partnership

(368)

 

(430)

Net cash used in financing activities

 

(23,738)

 

(53,376)

NET (DECREASE) INCREASE IN CASH

 

14,656

 

(4,330)

CASH, BEGINNING OF PERIOD

 

12,561

 

16,891

CASH, END OF PERIOD

$

27,217

$

12,561

Cash paid during period for interest

$

15,477

$

20,593

Cash paid during period for taxes

$

$

For the Years Ended

December 31,

    

2023

    

2022

CASH FLOWS FROM OPERATING ACTIVITIES

Net income

$

31,681

$

11,960

Adjustments to reconcile net income to net cash and cash equivalents provided by operating activities:

Depreciation, depletion and amortization

 

7,499

 

6,960

Amortization of deferred financing fees and discounts/premiums on debt

 

689

 

378

Amortization of net origination fees related to notes receivable

(19)

(37)

Stock-based compensation

 

1,853

 

1,523

Stock-based incentive

 

417

(Gain) on disposition of assets, net

 

(36,133)

 

(2,641)

(Income) from equity method investment

(1)

(52)

Bad debt expense

15

24

Current and expected credit losses

76

92

Impairment of assets

5,840

Amortization of dedesignated interest rate swap

198

449

Loss on early extinguishment of debt

162

Changes in operating assets and liabilities:

(Increase) Decrease in accounts receivable

 

865

 

(2,335)

(Increase) Decrease in interest receivable

(63)

(119)

(Increase) Decrease in other assets

 

112

 

(139)

(Increase) Decrease in inventory

473

 

251

Increase (Decrease) in accrued interest

 

611

 

1,383

Increase (Decrease) in accrued expenses

 

(1,509)

 

(1,533)

Increase (Decrease) in deferred revenue

 

564

 

56

Increase (Decrease) in accrued property taxes

 

136

 

252

Net cash and cash equivalents provided by operating activities

 

12,887

 

17,051

CASH FLOWS FROM INVESTING ACTIVITIES

Real estate acquisitions

 

(22,157)

(54,436)

Real estate and other improvements

 

(5,826)

(4,246)

Acquisition of non-real estate assets

(75)

Investment in equity method investees

(705)

Distributions from equity method investees

50

Collections of principal on loans

2,707

2,786

Origination fees on notes receivable

60

Issuance of loans and financing receivables

(11,800)

(20,781)

Proceeds from sale of property

195,487

16,999

Net cash and cash equivalents provided by (used in) investing activities

 

158,461

 

(60,398)

CASH FLOWS FROM FINANCING ACTIVITIES

Borrowings from mortgage notes payable

79,501

223,000

Repayments on mortgage notes payable

(155,894)

(296,941)

Proceeds from ATM offering

121,315

Issuance of stock

155

59

Common stock repurchased

(72,173)

Payment of debt issuance costs

(312)

(1,047)

Payment of swap fees

(437)

(291)

Redemption of Series A preferred units

(8,100)

(10,158)

Redemption of common units

(432)

Dividends on common stock

(12,273)

(11,126)

Shares withheld for income taxes on vesting of equity-based compensation

(43)

(186)

Distributions on Series A preferred units

(3,210)

(3,510)

Distributions to non-controlling interests in operating partnership, common

(295)

(285)

Net cash and cash equivalents provided by (used in) financing activities

 

(173,513)

 

20,830

Net (decrease) in cash and cash equivalents

 

(2,165)

 

(22,517)

Cash and cash equivalents, beginning of period

 

7,654

 

30,171

Cash and cash equivalents, end of period

$

5,489

$

7,654

Cash paid during period for interest

$

22,450

$

Cash paid during period for taxes

$

$

F-7

Farmland Partners Inc.

Consolidated Statements of Cash Flows (continued)

(in thousands)

For the Years Ended December 31,

    

2020

    

2019

SUPPLEMENTAL NON-CASH INVESTING AND FINANCING TRANSACTIONS:

Dividends payable, common stock

$

1,530

$

1,498

Distributions payable, common units

$

82

$

95

Preferred Unit distributions accrued

$

3,510

$

3,510

Preferred Share distributions accrued

$

$

2,240

Deferred offering costs amortized through equity in the period

$

$

218

Additions to real estate improvements included in accrued expenses

$

163

$

Right of use asset/lease liability

$

93

$

197

Swap fees payable included in accrued interest

$

146

$

Settlement of outstanding notes receivable with property acquisitions

$

487

$

1,895

For the Years Ended

December 31,

    

2023

    

2022

SUPPLEMENTAL NON-CASH INVESTING AND FINANCING TRANSACTIONS:

Dividend payable, common stock

$

12,961

$

3,259

Dividend payable, common units

$

325

$

74

Distributions payable, Series A preferred units

$

2,970

$

3,210

Deferred net gain from seller-financed dispositions

$

2,107

$

Additions to real estate improvements included in accrued expenses

$

275

$

853

Swap fees payable included in accrued interest

$

146

$

146

Prepaid property tax liability acquired in acquisitions

$

10

$

63

Deferred offering costs amortized through equity in the period

$

$

118

Right-of-use assets obtained in exchange for new operating lease liabilities

$

396

$

325

Non-cash conversion of notes receivable to real estate

$

$

2,135

See accompanying notes.

F-8

Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements

Note 1–1—Organization and Significant Accounting Policies

Organization

Farmland Partners Inc. (“FPI”), collectively with its subsidiaries, (the “Company”), is an internally managed real estate company that owns and seeks to acquire high-quality farmland located in agricultural markets throughout North America. The CompanyFPI was incorporated in Maryland on September 27, 2013. The Company is the sole member of the general partner of Farmland Partners Operating Partnership, LP (the “Operating Partnership”), which was formed in Delaware on September 27, 2013. As of December 31, 2020, the Company owned a portfolio of approximately 155,000 acres which are consolidated in these financial statements. All of the Company’s assets are held by, and its operations are primarily conducted through, the Operating Partnership and the wholly owned subsidiaries of the Operating Partnership. As of December 31, 2020, the Company owned 94.9% of the Class A Common units of limited partnership interest in the Operating Partnership (“Common units”) and none of the Series A preferred units of limited partnership interest in the Operating Partnership (“Series A preferred units”) or shares of our 6.00% Series B Participating Preferred Stock (the “Series B Participating Preferred Stock”). Unlike holders of our common stock, holders of Common units, Series A preferred units, and Series B Participating Preferred Stock, generally do not have voting rights or the power to direct our affairs. See Note 9 to our consolidated financial statements for additional information regarding the Series A preferred units and our Series B Participating Preferred Stock. Unlike holders of the Company’s common stock, holders of Common units and Series A preferred units generally do not have voting rights or the power to direct our affairs. On August 17, 2017, the Company issued 6,037,500 shares of its newly designated 6.00% Series B Participating Preferred Stock, $0.01 par value per share (the “Series B Participating Preferred Stock”) in an underwritten public offering.  Shares of Series B Participating Preferred Stock, which represent equity interests in the Company, generally have no voting rights and rank senior to the Company’s common stock with respect to dividend rights and rights upon liquidation (See “Note 9—Stockholders’ Equity—Series B Participating Preferred Stock” for more information on the Series B Participating Preferred Stock).

The CompanyFPI elected to be taxed as a real estate investment trust (“REIT”), under Sections 856 through 860 of the Internal Revenue Code of 1986, as amended (the “Code”), commencing with its short taxable year ended December 31, 2014.

FPI is the sole member of the sole general partner of Farmland Partners Operating Partnership, LP (the “Operating Partnership”), which was formed in Delaware on September 27, 2013. All of FPI’s assets are held by, and its operations are primarily conducted through, the Operating Partnership and the wholly owned subsidiaries of the Operating Partnership. As of December 31, 2023, FPI owned a 97.6% interest in the Operating Partnership. See “Note 9—Stockholders’ Equity and Non-controlling Interests” for additional discussion regarding Class A Common units of limited partnership interest in the Operating Partnership (“Common units”) and Series A preferred units of limited partnership interest in the Operating Partnership (“Series A preferred units”). Unlike holders of FPI’s common stock, par value $0.01 per share (“common stock”), holders of the Operating Partnership’s Common units and Series A preferred units generally do not have voting rights or the power to direct the affairs of FPI. As of December 31, 2023, the Operating Partnership owned a 9.97% equity interest in an unconsolidated equity method investment that holds 12 properties (see “Note 1—Organization and Significant Accounting Policies—Equity Method Investments” and “Note 4—Related Party Transactions”).

References to the “Company,” “we,” “us,” or “our” mean collectively FPI and its consolidated subsidiaries, including the Operating Partnership.

As of December 31, 2023, the Company owned a portfolio of approximately 132,800 acres of farmland, which is consolidated in these financial statements. In addition, as of December 31, 2023, we owned land and buildings for four agriculture equipment dealerships in Ohio leased to Ag-Pro Ohio, LLC (“Ag Pro”) under the John Deere brand and served as property manager for approximately 38,300 acres of farmland (see “Note 6—Loans and Financing Receivables”).

On March 16, 2015, the Company formed FPI Agribusiness Inc., a wholly owned subsidiary (the “TRS” or “FPI Agribusiness”), as a taxable REIT subsidiary. The TRS was formed toWe engage directly in farming, provide property management, auction, and brokerage services and volume purchasing services to our tenants through the Company’s tenants and also to operate a small scale custom farming business.TRS. As of December 31, 2020,2023, the TRS performs these customperformed direct farming operations on 3,6762,103 acres of farmland owned by the Company located in California, Florida, South Carolina, and Michigan. California.

All references to numbers and percent of acres within this report are unaudited.

Principles of Combination and Consolidation

The accompanying consolidated financial statements are presented on the accrual basis of accounting in accordance with accounting principles generally accepted in the United States of America ("GAAP"(“GAAP”) and include the accounts of the CompanyFPI and the Operating Partnership. All significant intercompany balances and transactions have been eliminated in consolidation. Certain prior year amounts have been reclassified to conform to the presentation used in 2020.the current year. Such reclassificationreclassifications had no effect on net income or total equity.

Use of Estimates

The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could materially differ from those estimates for a variety of reasons, including, without limitation, the impacts of public health crises, the war in Ukraine, substantially higher prices for oil and gas and substantially increased interest rates, and their effects on the domestic and global economies. We are unable to quantify the ultimate impact of these factors on our business.

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)(continued)

results could materially differ from those estimates, particularly in light of the ongoing coronavirus (“COVID-19”) pandemic and its effects on the domestic and global economies. So far, the direct impact of the COVID-19 pandemic on our business and operations has been somewhat limited. The Company has experienced a decrease in crop share revenue related to the permanent crop portfolio as a result of a decrease in demand for lemons and blueberries, and delayed and weaker pricing of the 2020 almonds crop as a result of the COVID-19 pandemic and trade war related disruptions.The pandemic has significantly affected only certain sectors of the U.S. agricultural industry to which we have limited or no direct exposure. Despite short and medium-term disruptions in the U.S. agricultural industry, we do not expect global demand for food, feed, fuel and fiber to be materially affected by the COVID-19 pandemic and the related economic turmoil, and therefore in the long term we expect the industry to experience some degree of transformation, but to survive relatively unscathed compared to other industries. We are unable to quantify what the ultimate impact of the pandemic on our business will be.

Real Estate Acquisitions

When the Company acquires farmland where substantially all of the fair value of the gross assets acquired is concentrated in a single identifiable asset, or a group of similar identifiable assets, it is not considered a business. As such, the Company accounts for these types of acquisitions as asset acquisitions. When substantially all of the fair value of the gross assets acquired is not concentrated in a single identifiable asset, or a group of similar assets, and contains acquired inputs and processes andwhich have the ability to contribute to the creation of outputs, these acquisitions are accounted for as a business combination.combinations.

The Company considers single identifiable assets as tangible assets that are attached to and cannot be physically removed and used separately from another tangible asset without incurring significant cost or significant diminution in utility or fair value. The Company considers similar assets as assets that have a similar nature and risk characteristics.

Whether the Company’s acquisitions are treated as an asset acquisitionacquisitions under ASC 360 or a business combinationcombinations under ASC 805, the fair value of the aggregate purchase price paid in each such acquisition is allocated among the assets acquired and any liabilities assumed by valuing the property as if it waswere vacant. The “as-if-vacant” value is allocated to land, buildings, improvements, permanent plantings and any liabilities, based on management’s determination of the relative fair values of such assets and liabilities as of the date of acquisition.

Upon acquisition of real estate, under ASC 805, the Company allocates the purchase price of the real estate based upon the fair value of the assets and liabilities acquired, which historically have consisted of land, drainage improvements, irrigation improvements, groundwater, permanent plantings (bushes,(trees, bushes, shrubs, vines and perennial crops), and grain facilities, and may also consist of intangible assets, including in-place leases, above market and below market leases, and tenant relationships. The Company allocates the purchase price to the fair value of the tangible assets by valuing the land as if it were unimproved. The Company values improvements, including permanent plantings and grain facilities, at replacement cost, adjusted for depreciation.

Management’s estimates of land value are made using adetermined based upon various sources including third-party appraisals, our own analysis of recently acquired or developed properties and existing comparable sales analysis.properties in our portfolio, and other market data. Factors considered by management in its analysis of land value include soil types, and water availability and the salessale prices of comparable farms. Management’s estimates of groundwater value are made using historical information obtained regarding the applicable aquifer. Factors considered by management in its analysis of groundwater value are related to the location of the aquifer and whether or not the aquifer is a depletable resource or a replenishing resource. If the aquifer is a replenishing resource, no value is allocated to the groundwater. The Company includes an estimate of property taxes in the purchase price allocation of acquisitions to account for the expected liability that was assumed.

When above or below market leases are acquired, the Company values the intangible assets based on the present value of the difference between prevailing market rates and the in-place rates measured over a period equal to the remaining term of the lease for above market leases, and the initial term plus the term of any below market fixed rate renewal options for below market leases that are considered bargain renewal options. The above market lease values are amortized as a reduction of rental income over the remaining term of the respective leases. The fair value of acquired below market leases,

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)

included in deferred revenue on the accompanying consolidated balance sheets, is amortized as an increase to rental income on a straight-line basis over the remaining non-cancelable terms of the respective leases, plus the terms of any below market fixed rate renewal options that are considered bargain renewal options of the respective leases. As of December 31, 2020, all below market leases had been fully amortized, with amortization totaling $0.0 million recorded in the twelve months ended December 31, 2020.

As of December 31, 2020 and 2019, the Company had $1.3 million and $1.3 million, respectively, recorded for tenant relationship intangibles, gross of accumulated amortization and amortization expense of $1.3 million and $1.2 million, respectively. The purchase price is allocated to in-place lease values and tenant relationships, if they are acquired, based on the Company’s evaluation of the specific characteristics of each tenant’s lease, availability of replacement tenants, probability of lease renewal, estimated down time and itsthe Company’s overall relationship with the tenant. The value of in-place lease intangibles and tenant relationships are included as an intangible asset and have been amortized over the remaining lease term (including expected renewal periods of the respective leases for tenant relationships) as amortization expense. If a tenant terminates its lease prior to its stated expiration, any unamortized amounts relating to that lease, including (i) above and below market leases, (ii) in-place lease values, and (iii) tenant relationships, would be recorded to revenue or expense as appropriate.

 

The Company capitalizes acquisition costs and due diligence costs if the asset is expected to qualify as an asset acquisition. If the asset acquisition is abandoned, the capitalized asset acquisition costs are expensed to acquisition and due diligence costs in the period of abandonment. Costs associated with a business combination are expensed to acquisition and due diligence costs as incurred. During

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (continued)

the years ended December 31, 20192023 and 2020,2022, the companyCompany incurred an immaterial amount of costs related to acquisition and due diligence.

 

Total consideration for acquisitions may include a combination of cash and equity securities. When equity securities are issued, the Company determines the fair value of the equity securities issued based on the number of shares of common stock and Commonor units issued multiplied by the price per share of the Company’s common stock on the date of closing in the case of common stock and Common units and by liquidation preference in the case of preferred stock and preferred units.or unit.

 

Using information available at the time of a business combination, the Company allocates the total consideration to tangible assets and liabilities and identified intangible assets and liabilities. Any residual amount remaining after such allocations is allocated to goodwill. During the measurement period, which may be up to one year from the acquisition date when incomplete information exists as of the respective reporting date, the Company may adjust the preliminary purchase price allocations after obtaining more information about assets acquired and liabilities assumed at the date of acquisition.

Real Estate Sales

The Company recognizes gains (losses) from the sales of real estate assets generally at the time the title is transferred and consideration is received and the Company no longer has substantial continuing involvement with the real estate sold.received.

Liquidity Policy

The Company manages its liquidity position and expected liquidity needs taking into consideration current cash balances, undrawn availability under its lines of credit ($201.1 million as of December 31, 2023), and reasonably expected cash receipts. The business model of the Company, and of real estate investment companies in general, relies onutilizes debt as a structural source of financing. When debt becomes due, it is generally refinanced rather than repaid using the Company’s cash flow from operations. The Company has a history of being able to refinance its debt obligations prior to manage its debt maturities.maturity. Furthermore, the Company also has a deepsubstantial portfolio of real estate assets whichthat management believes could be readily liquidated if necessary to fund any immediate liquidity needs. Management’s first courseAs of action isDecember 31, 2023, we had $360.9 million of mortgage and other debt against a portfolio of real estate assets with a net book value of $961.5 million. As of December 31, 2023, we had capacity to workissue up to $50.5 million of our common stock under our At-the-Market Equity Offering Program (the “ATM Program”). We also have an effective shelf registration statement with its lendersapproximately $100 million of capacity, in addition to refinanceavailability under the ATM Program, pursuant to which we could issue additional equity or debt which is coming duesecurities. For more information on terms acceptable to the Company. In the event the Company is unsuccessful in refinancing its debt on terms acceptable to the Company, management would look to liquidate certain assets to fund its liquidity shortfall.ATM Program please see “Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations—Liquidity and Capital Resources.”

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)

Real Estate

The Company’s real estate consists of land, groundwater and improvements made to the land consisting of permanent plantings, grain facilities, irrigation improvements, drainage improvements and other improvements. The Company records real estate at cost and capitalizes improvements and replacements when they extend the useful life or improve the efficiency of the asset. Construction in progress includes the costs to build new grain storage facilities and install new pivots, drainage and wells on newly acquired farms. The Company begins depreciating assets when the asset is ready for its intended use.

The Company expenses costs of repairs and maintenance at the time such costs are incurred. The Company computes depreciation and depletion for assets classified as improvements using the straight-line method over their estimated useful lives as follows:

    

Years

 

Grain facilities

 

10

-

40

Irrigation improvements

 

2

-

40

Drainage improvements

 

20

-

65

Groundwater

 

3

-

50

Permanent plantings

13

-

40

Other

 

5

-

40

The Company periodically evaluates the estimated useful lives for groundwater based on current state water regulations and depletion levels of the aquifers.

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (continued)

When a sale occurs, the Company recognizes the associated gain or loss when all consideration has been transferred, the sale has closed and there is no material continuing involvement. If a sale is expected to generate a loss, the Company first assesses it through the impairment evaluation process—see ‘‘Impairment of Real Estate Assets’’ below.

Impairment of Real Estate Assets

The Company evaluates its tangible and identifiable intangible real estate assets for impairment indicators whenever events such as declines in a property’s operating performance, deteriorating market conditions or environmental or legal concerns bring recoverability of the carrying value of one or more assets into question. If such events are present, the Company projects the total undiscounted cash flows of the asset, including proceeds from disposition, and compares them to the net book value of the asset. If this evaluation indicates that the carrying value may not be recoverable, an impairment loss is recorded in earnings equal to the amount by which the carrying value exceeds the fair value of the asset. There have been 0 impairmentswas $5.8 million and $0.0 million of impairment recognized on real estate assets in the accompanying financial statements.statements during the years ended December 31, 2023 and 2022, respectively.

Cash and Cash Equivalents

The Company’s cash and cash equivalents at December 31, 20202023 and 20192022 was held in the custody of 3five financial institutions for both periods and the Company’s balance at any given financial institution may at times exceed federally insurable limits. We consider highly liquid investments purchased with an original maturity of three months or less, such as money market funds, to be cash equivalents. The Company monitors balances with individual financial institutions to mitigate risks relating to balances exceeding such limits.

Debt Issuance Costs

Costs incurred by the Company in obtaining debt are deducted from the face amount of mortgage notes and bonds payable, net except for those costs relating to the Company’s lines of credit which are recognized as an asset within deferred financing fees, net. During the year ended December 31, 2020,2023, the Company incurred $0.3 million in connection with the payoff ofcollateral substitution and documentation on its Metlife and Farmer Mac Notes 8A and 9,debt. During the Farm Credit of Central Florida Note,year ended December 31, 2022, the Company incurred $1.0 million in connection with the related issuancerefinancing of MetLife 10, (asthe Rutledge debt and the establishment of the Metlife Facility and the Farmer Mac Facility (each as defined in “Note 7—Mortgage Notes, Lines of Credit and Bonds Payable, net”Payable”). During the year ended December 31, 2019, the Company incurred 0 costs in connection with the issuance of debt. Debt issuance costs are

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)

amortized using the straight-line method, which approximates the effective interest method, over the terms of the related indebtedness. Any unamortized amounts upon early repayment of mortgage notes payable are written off in the period in which repayment occurs. Fully amortized deferred financing fees are removed from the books upon maturity or repayment of the underlying debt. The Company recorded amortization expense of $0.3$0.7 million and $0.4 million for each of the years ended December 31, 20202023 and 2019,2022, respectively, which is included in interest expense in the accompanying Consolidated Statements of Operations. Accumulated amortization of deferred financing fees was $1.3$1.9 million and $1.0$1.2 million as of December 31, 20202023 and 2019,2022, respectively. For more information on the Company’s debt, see “Note 7—Mortgage Notes, Lines of Credit and Bonds Payable”.

NotesLoans and Interest ReceivableFinancing Receivables

Notes receivableLoans and financing receivables are stated at their unpaid principal balance and include unamortized direct origination costs, prepaid interest and accrued interest through the reporting date, less any allowance for losses and unearned borrower paid points.

Management determines the appropriate classification of debt securities at the time of issuance and reevaluates such designation as of each balance sheet date. As of December 31, 2020,2023 and 2022, the Company has two types of loans and financing receivables: loans under the Company’s loan program (the “FPI Loan Program”) and sale-leaseback transactions accounted for as financing receivables.

Loans under the FPI Loan Program: The Company offers an agricultural lending product focused on farmers as a complement to the Company’s business of acquiring and owning farmland and leasing it to farmers. Under the FPI Loan Program, the Company makes loans to third-party farmers (both tenant and non-tenant) to provide financing for property acquisitions, working capital requirements, operational farming activities, farming infrastructure projects and for other farming and agricultural real estate related projects. As of December 31, 2023 and 2022, the Company had issued 3six and three notes outstanding, respectively, under the FPI Loan Program and havehas designated each of the notes receivable as loans. Loans are stated at amortized cost, adjusted

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (continued)

Sale-leaseback Transactions Accounted for amortization of premiumsas Financing Arrangements: In November 2022, the Company purchased land and accretion of discountsbuildings for four agriculture equipment dealerships in Ohio leased to maturity computedAg Pro under the straight-line method,John Deere brand. In accordance with ASC 842, for transactions in which approximates the effective interest method. Such amortization, including interest,Company enters into a contract to acquire an asset and lease it back to the seller, the Company is required to separately assess the lease classification apart from the other assets. The Company determined that the land and building components of the lease agreement with Ag Pro meet the definition of a sales-type lease and therefore, control is not considered to have transferred to the Company under GAAP. As a result, the Company does not recognize the underlying asset but instead recognizes a financial asset in accordance with ASC 310 “Receivables.” Accordingly, the transactions with Ag Pro are accounted for as financing receivables and are included in other revenue within our Consolidated Statementsloans and financing receivables, net on the accompanying consolidated balance sheets, net of Operations. See “Note 6—Notes Receivable.”allowance for credit losses, in accordance with ASC 310.

Allowance for Notes and Interest ReceivableCurrent expected credit losses (“CECL”)

A note: Under ASC 326, the Company is required to estimate an expected lifetime credit loss. For loans under the FPI Loan Program, a loan is placed on non-accrual status when management determines, after considering economic and business conditions and collection efforts, that the noteloan is impaired or collection of interest is doubtful. The accrual of interest on the instrument ceases when there is concern that principal or interest due according to the note agreement will not be collected. Any payment received on such non-accrual notesloans are recorded as interest income when the payment is received. The noteloan is reclassified as accrual-basis once interest and principal payments become current. The Company periodically reviews the value of the underlying collateral of farm real estate for the noteloan receivable and evaluates whether the value of the collateral continues to provide adequate security for the note. Should the value of the underlying collateral become less than the outstanding principal and interest, the Company will determine whether an allowance is necessary.loan. Any uncollectible interest previously accrued is also charged off. As of December 31, 2020,2023 and 2022, we believebelieved the value of the underlying collateral for each of the notesloans to be sufficient and in excess of the respective outstanding principal and accrued interest.interest and no loans are currently on non-accrual status.

The Company monitors its loans and financing receivables using a CECL methodology which is based upon historical collection experience, collateral values, current trends, long-term probability of default (“PD”) and estimated loss given default (“LGD”). This approach calculates impairment by multiplying the PD (probability the asset will default within a given timeframe) by the LGD (percentage of the asset not expected to be collected due to default). The PD and LGD are estimated using average historical default rates of a company with similar credit risk factors to the Company’s tenant where practical. Accrued interest write-offs are recognized as credit loss expense. The CECL allowance is recorded as a reduction to loans and financing receivables, net on the accompanying consolidated balance sheets. The CECL allowance is updated on a quarterly basis with the resulting change being recorded in the consolidated statements of operations for the relevant period. Charge-offs are deducted from the allowance in the period in which they are deemed uncollectible. Recoveries previously written off are recorded when received.

Deferred Offering Costs

Deferred offering costs include incremental direct costs related to regulatory, legal, accounting and professional service costs incurred by the Company in conjunctionconnection with proposed or actual offerings of securities. At the completion of thea securities offering, the deferred offering costs are charged ratably as a reduction of the gross proceeds of equity as stock is issued. If an offering is abandoned, the previously deferred offering costs will be charged to operations in the period in which the abandonment occurs.offering is abandoned. The Company incurred $0.0 million and $0.1 million in offering costs during the years ended December 31, 20202023 and 2019.2022, respectively. As of December 31, 20202023 and 2019,2022, the Company had $0.0$0.00 million and $0.06 million, respectively, in deferred offering costs related to regulatory, legal, accounting and professional service costs associated with proposed or actualcompleted offerings of securities.securities, net of amortization, remaining on the balance sheet.

Assets Held for Sale

The Company determines whether certain assets meet the criteria of assets held for sale in accordance with ASC Topic 360, “Property, Plant, and Equipment.” These assets are measured at the lower of (i) the carrying value and (ii) the fair value of the assets, less costs to sell. The Company determines fair value based on the three-level valuation hierarchy for fair value measurement. Effective with the designation of the assets as held for sale, the Company suspends recording depreciation of the assets, resulting in a decrease in depreciation during the period. As of December 31, 2023, the Company had less than $0.1 million classified as held for sale within the accompanying consolidated balance sheets.

Accounts Receivable

Accounts receivable are presented at face value, net of the allowance for doubtful accounts. The Company records an allowance for doubtful accounts, reducing the receivables balance to an amount that it estimates is collectible from our customers. Estimates used in

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Notes to Consolidated Financial Statements (continued)

determining the allowance for doubtful accounts are based on historical collection experience, current trends, aging of accounts receivable and periodic credit evaluations of the Company’s customers’ financial condition. The Company creates an allowance for accounts receivable when it becomes apparent, based upon age or

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)

customer circumstances, that an amount may not be collectible, such that all current expected losses are sufficiently reserved for at each reporting period. The Company considered its current expectations of future economic conditions including the impact of COVID-19, when estimating its allowance for doubtful accounts. The allowance for doubtful accounts was $0.0 million andless than $0.1 million as of December 31, 20202023 and 2019, respectively, which2022. An allowance for doubtful accounts is recorded on the Consolidated StatementStatements of Operations as a reduction to rental revenue if in relation to revenues recognized in the year, or as property operating expenses if in relation to revenue recognized in the prior years.

Inventory

TheInventory consists of costs ofrelated to crops grown on farms directly operated by the TRS and is separated into growing crops are accumulated untilcrop inventory, harvested crop inventory or general inventory, as appropriate. Inventory is stated in the time of harvestconsolidated balance sheets at the lower of cost or net realizable value and are included invalue.

Growing crop inventory in the consolidated balance sheets. Costs areconsists of costs allocated to growing crops based on a percentage of the total costs of production and total operating costs that are attributable to the portion of the crops that remain in inventory at the end of the period. The costs of growing crops incurred by FPI Agribusiness consisthave not yet been harvested, primarily of costs related to land preparation, cultivation, irrigation and fertilization. Growing crop inventory is charged to cost of products sold when the related crop is harvested and sold and is included in other operating expenses.sold. The cost of harvested cropcrops sold was $3.4$4.8 million and $0.9$6.0 million for the years ended December 31, 20202023 and 2019,2022, respectively.

 

Harvested crop inventory includesconsists of costs accumulated both during the growing and harvesting phases and areallocated to harvested crops. Harvested crop inventory is stated at the lower of thoseaccumulated costs or the estimated net realizable value, which is the market price of the harvested crops, based upon the nearest market in the geographic region, less any cost of disposition. Cost of disposition includes broker’s commissions, freight and other marketing costs. 

General inventory, such as fertilizer, seeds and pesticides, is valued at the lower of cost or net realizable value.

As of December 31, 20202023 and December 31, 2019,2022, inventory consisted of the following:

 

December 31,

($ in thousands)

    

2020

 

2019

(in thousands)

    

December 31, 2023

    

December 31, 2022

Harvested crop

$

47

$

171

$

246

$

Growing crop

1,070

1,379

2,089

2,808

General inventory

$

1,117

$

1,550

$

2,335

$

2,808

Revenue RecognitionEquity Method Investments

Rental income includes rents that each tenant paysOn January 20, 2021, the Company entered into property sale and long-term management agreements with Promised Land Opportunity Zone Farms I, LLC (the “OZ Fund”), a private investment fund focused on acquiring and improving farmland in qualified opportunity zones in the United States, as designated under U.S. tax provisions enacted in 2017. As consideration for 10 farms sold to the OZ Fund in March 2021, the Company received approximately $2.4 million in convertible notes receivable, which, in addition to the accrued interest thereon, was converted into membership interests in the OZ Fund at the Company’s election in July 2021. The OZ Fund will exist until an event of dissolution occurs, as defined in the limited liability company agreement of the OZ Fund (the “Fund Agreement”). Under the Fund Agreement, the manager of the OZ Fund may call for additional capital contributions from its members to fund expenses, property acquisitions and capital improvements in accordance with each members’ funding ratio. The Company’s capital contributions are capped at $4.3 million.

Under the termsFund Agreement, any available cash, after the allowance for the payment of its lease. Minimum rents pursuantall obligations, operating expenses and capital improvements, is distributed to leases are recognized as revenue on a straight-line basis over the lease term, including renewal options inmembers at least annually. For each fiscal year, net income or loss is allocated to the case of bargain renewal options. Deferred revenue includes the cumulative difference between the rental revenue recorded on a straight-line basis and the cash rent received from tenantsmembers pro rata in accordance with the lease terms. Acquired below market leases are included in deferred revenuetheir percentage interest. See “Note 4—Related Party Transactions” for more information on the accompanying consolidated balance sheets, which are amortized into rental income over the life of the respective leases, plus the terms of the below market renewal options, if any.OZ Fund.

Leases in place as of December 31, 2020 had terms ranging from one to forty years. As of December 31, 2020, the Company had 99 leases over 209 properties with rent escalations. The majority of the Company’s leases provide for a fixed annual or semi-annual cash rent payment. Tenant leases on acquired farms generally require the tenant to pay the Company rent for the entire initial year regardless of the date of acquisition, if the acquisition is closed prior to, or shortly after, planting of crops. If the acquisition is closed later in the year, the Company typically receives a partial rent payment or no rent payment at all.Goodwill and Intangible Assets

CertainGoodwill represents the excess of the Company’s leases provide for a rent payment determined as a percentagepurchase price over the estimated fair value of the gross farm proceeds (contingent rent). Revenue under leases providingnet assets acquired in the acquisition of a business. Goodwill is not amortized, but rather is tested for a payment equal to a percentage ofimpairment annually in the gross farm proceeds are recorded at the guaranteed crop insurance minimumsfourth quarter and recognized ratably over the lease term during the crop year.when events or changes in

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)(continued)

Upon notification fromcircumstances indicate that the grain or packing facility thatfair value of a future contract for deliveryreporting unit with goodwill has been reduced below its carrying value. The impairment test requires allocating goodwill and other assets and liabilities to reporting units. The fair value of each reporting unit is determined and compared to the carrying value of the harvest has been finalized or whenreporting unit. The fair value is calculated using the tenant has notifiedexpected present value of future cash flows method. Significant assumptions used in the Companycash flow forecasts include future cash flows, discount rates and future capital requirements. If the fair value of the total amount of gross farm proceeds, revenuereporting unit is recognized forless than the carrying value, including goodwill, the excess of the actual gross farm proceeds andbook value over the previously recognized minimum guaranteed insurance. Contingent rent recognized forfair value of goodwill is charged to net income as an impairment expense. During the years ended December 31, 20202023 and 2019 totaled $9.3 million and $11.4 million, respectively.2022, the Company did not incur any impairment charges related to goodwill.

CertainAmortization of the Company’s leases provide for minimum cash rent plus a bonus based on gross farm proceeds. Revenue under this type of leaseintangible assets with definite lives is recognized on a straight-line basis over the lease term based on the minimum cash rent. Bonus rent is recognized upon notification from the tenant of the gross farm proceeds for the year.

Tenant reimbursements include reimbursements for real estate taxes that each tenant pays in accordance with the terms of its lease. When leases require that the tenant reimburse the Company for property taxes paid by the Company, the reimbursement is reflected as tenant reimbursement revenue on the statements of operations, as earned, and the related property tax as property operating expense, as incurred.

Crop sales revenue

The Company records revenue from the sale of harvested crops when the harvested crop has been contracted to be delivered to a grain or packing facility and title has transferred. Harvested crops delivered under marketing contracts are recorded using the fixed price of the marketing contract at the time of delivery to a grain or packing facility. Harvested crops delivered without a marketing contract are recorded using the market price at the date the harvested crop is delivered to the grain or packing facility and title has transferred.

Other revenue

The Company recognizes interest income on notes receivable on an accrual basis over the life of the note. Direct origination costs are netted against loan origination fees and are amortized over the life of the notecalculated using the straight-line method, which approximatesis reflective of the effective interest method, asbenefit pattern in which the estimated economic benefit is expected to be received over the estimated useful life of the intangible asset. Intangible assets subject to amortization are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount of the intangible asset may not be recoverable. If the sum of the expected undiscounted future cash flows related to the asset is less than the carrying amount of the asset, an adjustmentimpairment loss is recognized based on the fair value of the asset. Trade names and trademarks have an indefinite life and, therefore, are not subject to interest income which is included as a component of other revenueamortization, but rather are tested for impairment annually in the Company’s Consolidated Statementsfourth quarter and when events or changes in circumstances indicate that the fair value is below its carrying value. Customer relationships are subject to amortization and are amortized over a period of Operations for10 to 12 years. During the years ended December 31, 20202023 and 2019.2022, the Company recorded amortization of customer relationships of less than $0.1 million for each period.

Income Taxes

As a REIT, the Company is permitted to deduct dividends, for income tax purposes, paid to its stockholders, thereby eliminating the U.S. federal taxation of income represented by such distributions at the Company level, provided certain requirements are met. REITs are subject to a number of organizational and operational requirements. If the Company fails to qualify as a REIT in any taxable year, the Company will be subject to U.S. federal income tax (including, for periods prior to 2018,2021, any applicable alternative minimum tax) on its taxable income at regular corporate tax rates. The Company recorded income tax (benefit) expense totaling $0.0$(0.2) million and $0.2 million, respectively, for the years ended December 31, 20202023 and 2019.2022.

The Operating Partnership leases certain of its farms to the TRS, which is subject to federal and state income taxes. The TRS accounts for income taxes using the asset and liability method under which deferred tax assets and liabilities are recognized for temporary differences between the financial reporting basis of assets and liabilities and their respective income tax basis and for operating loss, capital loss and tax credit carryforwards based on enacted income tax rates expected to be in effect when such amounts are realized or settled. However, deferred tax assets are recognized only to the extent that it is more likely than not they will be realized on consideration of available evidence, including future reversals of existing taxable temporary differences, future projected taxable income and tax planning strategies. There was $(1.9)$(2.5) million and $4.0 million in taxable income (loss) from the TRS for the yearyears ended December 31, 2020,2023 and $(0.2) million at December 31, 2019. The Company did not have any deferred tax assets or liabilities for these years.2022, respectively.

The Company performs an annual review for any uncertain tax positions and, if necessary, will record future tax consequences of uncertain tax positions in the financial statements. An uncertain tax position is defined as a position taken or expected to be taken in a tax return that is not based on clear and unambiguous tax law and which when examined by

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)

taxing authorities is more-likely-than-not to be sustained on review and which is reflected in measuring current or deferred income tax assets and liabilities for interim or annual periods. At December 31, 2020,2023, the Company did not identify any uncertain tax positions. The Company did not identify any uncertain tax positions related to the 20192022 open tax year.

When the Company acquires a property in a business combination, the Company evaluates such acquisition for any related deferred tax assets or liabilities and determines if a deferred tax asset or liability should be recorded in conjunction with the purchase price allocation. If a built-in gain is acquired, the Company evaluates the required holding period (generally 5 years) and determines if it has the ability and intent to hold the underlying assets for the necessary holding period. If the Company has the ability to hold the underlying assets for the required holding period, 0no deferred tax liability is recorded with respect to the built-in gain. The Company determined that 0no deferred tax asset or liability should be recorded as a result of any acquisitions that it undertook during the years ended December 31, 20202023 and December 31, 2019.2022.

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (continued)

Fair Value

DerivativesThe Company is required to disclose fair value as further explained in “Note 6—Notes Receivable”, “Note 7—Mortgage Notes, Lines of Credit and Bonds Payable” and “Note 10—Hedge Accounting”. FASB ASC 820-10 establishes a three-level hierarchy for the disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows:

Level 1—Inputs to the valuation methodology are quoted prices for identical assets or liabilities in active markets.
Level 2—Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable or can be substantially corroborated for the asset or liability, either directly or indirectly.
Level 3—Inputs to the valuation methodology are unobservable, supported by little or no market activity and are significant to the fair value measurement.

Hedge Accounting

ASC 815 requires the Company to recognize all of its derivative instruments as either assets or liabilities in the consolidated balance sheet at fair value. The accounting for changes in the fair value (i.e., gains or losses) of a derivative instrument depends on whether it has been designated and qualifies as part of a hedging relationship and, further, on the type of hedging relationship. For those derivative instruments that are designated and qualify as hedging instruments, the company must designate the hedging instrument, based upon the exposure being hedged, as a fair value hedge, cash flow hedge or a hedge of a net investment in a foreign operation. For derivative instruments not designated as hedging instruments, the gain or loss is recognized in the consolidated statements of operations during the reporting period.

The Company manages economic risks, including interest rate, liquidity, and credit risk, by managing the amount, sources, duration and interest rate exposure of its funding. The Company may also use interest rate derivative financial instruments, namely interest rate swaps.

The Company entersmay enter into marketing contracts to sell commodities. Derivatives and hedge accounting guidance requires a company to evaluate these contracts to determine whether the contracts are derivatives. Certain contracts that meet the definition of a derivative may be exempt from derivative accounting if designated as normal purchase or normal sales. The Company evaluates all contracts at inception to determine if they are derivatives and if they meet the normal purchase and normal sale designation requirements. All contracts entered into during the year ended December 31, 2020 met the criteria to be exempt from derivative accounting and were designated as normal purchase and sales exceptions for hedge accounting.

The Company has in place one interest rate swap agreement with Rabobank to add stability to interest expense and to manage its exposure to interest rate movements. This agreement qualifies as a cash flow hedge and is actively evaluated for itsongoing effectiveness (see Note 12 – “Hedge“Note 10—Hedge Accounting”). The entire change in the fair value of the Company’s designated cash flow hedges is recorded to accumulated other comprehensive income, a component of shareholders’stockholders’ equity in the Company’s consolidated balance sheets.

Additionally, the Company assesses whether the derivative used in its hedging transaction is expected to be highly effective in offsetting changes in the fair value or cash flows of the hedged item. The Company discontinues hedge accounting when it is determined that a derivative has ceased to be or is not expected to be highly effective as a hedge, and then reflects changes in fair value of the derivative as gain or loss, as applicable, in earningsthe consolidated statements of operations during reporting periods after termination of the hedge relationship.such determination.

Segment Reporting

The Company’s chief operating decision maker does not evaluate performance on a farm-specific or transactional basis and does not distinguish the Company’s principal business or group its operations on a geographical basis for purposes of measuring performance. Accordingly, the Company believes it has a single operating segment for reporting purposes in accordance with GAAP.

Earnings Per Share

Basic earnings per share is calculated by dividing net income (loss) available to common stockholders by the weighted-average number of shares of common stock outstanding during the period, excluding the weighted average number of unvested restricted shares (“participating securities” as defined in “Note 9—Stockholders’ Equity and non-controlling Interests”). Diluted earnings per share is calculated by dividing net income (loss) available to common

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)(continued)

calculated by dividing net income (loss) available to common stockholders by the weighted-average number of shares of common stock outstanding during the period, plus other potentially dilutive securities such as stock grants or shares that would be issued in the event that Common units are redeemed for shares of common stock of the Company. No adjustment is made for shares that are anti-dilutive during a period.

Non-controlling Interests

The Company’s non-controlling interests are interests in the Operating Partnership not owned by the Company.FPI. The Company evaluates whether non-controlling interests are subject to redemption features outside of its control. The Company classifies non-controlling interests that are contingently redeemable solely for cash (unless stockholder approval is obtained to redeem for shares of common stock) one year after issuance or deemed probable to eventually become redeemable and which have redemption features outside of its control, as redeemable non-controlling interests in the mezzanine section of the consolidated balance sheets. The amounts reported for non-controlling interests on the Company’s Consolidated Statements of Operations represent the portion of income or losses not attributable to the Company.

Stock Based Compensation

From time to time, the Company may award non-vested shares under the Company’s SecondThird Amended and Restated 2014 Equity Incentive Plan (the “Plan”) as compensation to officers, employees, non-employee directors and non-employee consultants (see “Note 9—Stockholders’ Equity and Non-controlling Interests”). The shares issued to officers, employees, and non-employee directors vest over a period of time as determined by the Board of Directors at the date of grant. The Company recognizes compensation expense for non-vested shares granted to officers, employees and directors on a straight-line basis over the requisite service period based upon the fair value of the shares on the date of grant, as adjusted for forfeitures. The Company recognizes expense related to non-vested shares granted to non-employee consultants over the period that services are received.

New or RevisedRecently Adopted Accounting Standards

Recently adopted

In June 2016, the FASB issued ASU 2016-13, Financial Instruments - Credit Losses (Topic 326): Measurement of Credit Losses on Financial Instruments, which changes the method and timing of the recognition of credit losses on financial assets. For trade and other receivables, held-to-maturity debt securities, loans and other instruments, entities are required to use a new forward-looking "expected loss" model that generally will result in the earlier recognition of allowance for losses. This credit loss standard is required to be applied using a modified-retrospective approach and requires a cumulative-effect adjustment to retained earnings be recorded as of the date of adoption. In November 2018, the FASB issued ASU 2018-19, which clarifies that operating lease receivables are outside the scope of the new standard. The Company adopted the new standard on January 1, 2020. The adoption of the standard did not have a material impact on its financial position or results of operations. 

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)

In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848), that provided practical expedients to address existing guidance on contract modifications and hedge accounting due to the expected market transition from the London Inter-bank Offered Rate (“LIBOR”) and other interbank offered rates (together, “IBORs”) to alternative reference rates, such as the Secured Overnight Financing Rate.Rate (“SOFR”). In July 2017, the Financial Conduct Authority announced it intended to stop compelling banks to submit rates for the calculation of LIBOR after 2021. We refer to this transition as “reference rate reform.”

The first practical expedient allows companies to elect to not apply certain modification accounting requirements to debt, derivative and lease contracts affected by reference rate reform if certain criteria are met. These criteria include the following: (i) the contract referenced an IBOR rate that is expected to be discontinued; (ii) the modified terms directly replace or have the potential to replace the IBOR rate that is expected to be discontinued; and (iii) any contemporaneous changes to other terms that change or have the potential to change the amount and timing of contractual cash flows must be related to the replacement of the IBOR rate. If the contract meets all three criteria, there is no requirement for remeasurement of the contract at the modification date or reassessment of the previous hedging relationship accounting determination.

The second practical expedient allows companies to change the reference rate and other critical terms related to the reference rate reform in derivative hedge documentation without having to de-designate the hedging relationship. This allows for companies to continue applying hedge accounting to existing cash flow and net investment hedges.

TheIn December 2022, the FASB issued ASU was effective upon issuance on a prospective basis beginning January 1, 2020 and may be elected over2022-06, Reference Rate Reform (Topic 848): Deferral of the Sunset Date of Topic 848, which extends the period of time aspreparers can utilize the reference rate reform activities occur. Duringrelief guidance in Topic 848. The objective of the first quarterguidance in Topic 848 is to provide relief during the temporary transition period, so the FASB included a sunset provision within Topic 848 based on expectations of 2020,when the Company electedLondon Interbank Offered Rate (LIBOR) would cease being published. In 2021, the UK Financial Conduct Authority (FCA) delayed the intended cessation date of certain tenors of USD LIBOR to June 30, 2023. To ensure the relief in Topic 848 covers the period of time during which a significant number of modifications may take place, the ASU defers the sunset date of Topic 848 from December 31, 2022, to December 31, 2024, after which entities will no longer be permitted to apply the hedge accounting practical expedientrelief in Topic 848.

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Farmland Partners Inc.

Notes to its cash flow hedge. Consolidated Financial Statements (continued)

The Company will continue to evaluate its debt, derivative and lease contracts that are eligible for modification relief and expects to apply those elections as needed.

In  December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740): Improvements to Income Tax Disclosures. Among other things, these amendments require that public business entities on an annual basis (i) disclose specific categories in the rate reconciliation, and (ii) provide additional information for reconciling items that meet a quantitative threshold (if the effect of those reconciling items is equal to or greater than 5 percent of the amount computed by multiplying pretax income or loss by the applicable statutory income tax rate). The amendments require that all entities disclose on an annual basis (i) the amount of income taxes paid (net of refunds received) disaggregated by federal, state, and foreign taxes, (ii) the amount of income taxes paid (net of refunds received) disaggregated by individual jurisdictions in which income taxes paid (net of refunds received) is equal to or greater than 5 percent of total income taxes paid (net of refunds received), (iii) income (loss) from continuing operations before income tax expense (or benefit) disaggregated between domestic and foreign, and (iv) income tax expense (benefit) from continuing operations disaggregated by federal, state, and foreign. The ASU is effective for public business entities for annual periods beginning after December 15, 2024.

Note 2—Revenue Recognition

Fixed Rent: The majority of the Company’s leases provide for rent payments on an entirely or partially fixed basis. For the majority of its fixed farm rent leases, the Company receives at least 50% of the annual lease payment from tenants eitherbefore crops are planted, generally during the first quarter of the year, or at the time of acquisition of the related farm, with the remaining 50% of the lease payment due in the second half of the year.year generally after the crops are harvested. Rental income is recorded on a straight-line basis over the lease term. Certain of the Company’s leases provide for tenants to reimburse the Company for property taxes and other expenses. These tenant reimbursements and rent payments are treated as a single lease component because the timing and pattern of revenue recognition is the same. This means that rental income is equal in all periods of the lease, calculated by adding all expected lease payments (including increases within the lease) and dividing by the number of periods, despite the cash rents being received in lump sums at the specific times as described above. The lease term generally includesconsiders periods when a tenant: (1) may not terminate its lease obligation early; (2) may terminate its lease obligation early in exchange for a fee or penalty that the Company considers material enough such that termination would not be probable; (3) possesses renewal rights and the tenant’s failure to exercise such rights imposes a penalty on the tenant material enough such that renewal appears reasonably assured; or (4) possesses bargain renewal options for such periods. Payments received in advance are included in deferred revenue until they are earned.

Variable Rent:Certain of the Company’s leases provide for a rent payment determined as a percentage of the gross farm proceeds (contingent rent).in their entirety or above a certain threshold. Revenue under leases providing for a payment equal to a percentage of the gross farm proceeds arevariable rent may be recorded at the guaranteed crop insurance minimums and recognized ratably over the lease term during the crop year. Upon notification from the grain or packing facility that a future contract for delivery of the harvest has been finalized or when the tenant has notified the Company of the total amount of gross farm proceeds, revenue is recognized for the excess of the actual gross farm proceeds and the previously recognized minimum guaranteed insurance.

Fixed Rent and Variable Rent:Certain of the Company’s leases provide for a minimum cashfixed rent plus a bonusvariable rent based on gross farm proceeds. Revenue under this type of lease is recognized on a straight-line basis over the lease term based on the minimum cash rent. Bonus rent is recognized upon notification from the tenant of the gross farm proceeds for the year.revenue.

As ofThe following table presents rental income that is disaggregated by revenue source for the years ended December 31, 20202023 and 2019, the Company had $0.0 million and $0.1 million, respectively, in deferred revenue. The Company did not have any unamortized below market leases as of December 31, 2020 and 2019, respectively.2022:

For the years ended

December 31,

(in thousands)

    

2023

    

2022

Fixed Farm Rent

$

33,739

$

32,878

Solar, Wind and Recreation Rent

3,954

2,647

Tenant Reimbursements

 

3,428

 

3,264

Variable Rent

 

8,064

 

10,090

$

49,185

$

48,879

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)(continued)

The Company’s leases generally have terms ranging from one to three years, with some extending up to 40 years (e.g., renewable energy leases). Payments received in advance are included in deferred revenue until they are earned. As of December 31, 2023 and 2022, the Company had $2.1 million and less than $0.1 million, respectively, in deferred revenue.

The majority of the Company’s revenue is derived from rental income. The Company elected an accounting policy to account for both its lease and non-lease components (specifically tenant reimbursements) as a single lease component under ASC 842.

The following representssets forth a summary of the rental income recognized during the three years ended December 31, 2020:2023 and 2022:

Rental Income Recognized

Rental income recognized

For the year ended December 31,

For the years ended

($ in thousands)

    

2020

    

2019

    

December 31,

(in thousands)

    

2023

    

2022

Leases in effect at the beginning of the year

$

39,138

$

45,977

$

45,863

$

40,015

Leases entered into or amended during the year

 

4,555

 

2,142

Leases entered into during the year

 

3,322

 

8,864

$

43,693

$

48,119

$

49,185

$

48,879

Future minimum leasefixed rent payments from tenants under all non-cancelable leases in place as of December 31, 2020,2023, including lease advances when contractually due, but excluding crop share and tenant reimbursement of expenses, and lease payments based on a percentage of farming revenues, for each of the next five years and beyondthereafter as of December 31, 20202023 are as follows:

($ in thousands)

    

Future Rental

(in thousands)

    

Future rental

Year Ending December 31,

Payments

payments

2021

$

28,103

2022

 

16,629

2023

8,716

2024

 

3,421

$

33,095

2025

2,601

20,637

2026 and beyond

23,493

2026

 

13,336

2027

7,262

2028

2,941

Thereafter

30,539

$

82,963

$

107,810

Since lease renewal periods are exercisable at the option of the lessee, the preceding table presents future minimum lease payments due during the initial lease term only.

TheCrop Sales: For farms directly operated through the TRS, the Company records revenue from the sale of harvested crops when the harvested crop has been contracted to be delivered to a grain or packing facility and title has transferred. Revenues from the sale of harvested crops totaling $1.9 million and $1.0 million were recognized for the years ended 2020December 31, 2023 and 2019,2022 were $2.3 million and $5.4 million, respectively. Harvested crops delivered under marketing contracts are recorded using the fixed price of the marketing contract at the time of delivery to a grain or packing facility. Harvested crops delivered without a marketing contract are recorded using the market price at the date the harvested crop is delivered to the grain or packing facility and title has transferredtransferred.

Other Revenue: Other revenue includes crop insurance proceeds, auction fees, brokerage fees, interest income, and property management income. Crop insurance proceeds are recognized when the amount is determinable and collectible. Crop insurance proceeds are generally received in lieu of crop sales on farms directly operated through the TRS. The Company generates auction revenue by contracting with a real estate owner to market and auction farm property. Successful bidders sign a purchase agreement immediately following the auction. Auction fee revenue is recognized upon completion of the auction. The Company generates real estate brokerage commissions by acting as a broker for real estate investors or owners seeking to buy or sell farm property. Revenue from brokerage fees is recognized upon completion of the transaction. Property management revenue is recognized over the term of the contract as services are being provided. The Company collects property management fees in advance of the commencement of property management activities on behalf of third parties and includes them in deferred revenue until they are earned over the life of the contract. Interest income is recognized on loans and financing receivables on an accrual basis over the life of the loans. Direct origination costs are netted against loan origination fees and are amortized over the life of the note using the straight-line method, which approximates the effective interest method, as an adjustment to interest income which is included as a component of other revenue in the Company’s Consolidated Statements of Operations for the years ended December 31, 2023 and 2022.

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (continued)

The following table presents other revenue that is disaggregated by revenue source for the years ended December 31, 2023 and 2022:

For the years ended

December 31,

(in thousands)

    

2023

    

2022

Auction and brokerage fees

$

1,138

$

2,806

Crop insurance proceeds

2,335

2,609

Property management income

 

890

 

730

Other (e.g., interest income)

 

1,661

 

814

$

6,024

$

6,959

Note 3—Concentration Risk

Credit Risk

For the years ended December 31, 20202023 and 2019,2022, the Company had certain tenant concentrations as presented in the table below. If a significant tenant, representing a tenant concentration, fails to make rental payments to the Company or elects to terminate its leases, and the land cannot be re-leased on satisfactory terms, there wouldmay be a material adverse effect on the Company’s financial performance and the Company’s ability to continue operations. The following is a summary of our significant tenants:

Rental Income Recognized

For the year ended December 31,

($ in thousands)

    

2020

    

2019

    

Tenant A(1)

$

2,042

4.6

$

5,905

12.2

Tenant B(1)

$

7,924

17.8

$

7,056

14.6

Rental income recognized

    

Approximate % of rental income

For the years ended December 31,

    

For the years ended December 31,

($ in thousands)

2023

2022

    

2023

2022

Tenant A (1)

$

6,702

$

8,291

13.6

%  

17.0

%  

(1)The Company has numerous permanent crop leases with these major farming companies located in Califonia.California.

Geographic Risk

The following table summarizes the percentage of approximate total acres owned as of December 31, 2023 and 2022, and the fixed and variable rent recorded by the Company for the years then ended by location of the farm:

Approximate %

Rental Income (1)

of total acres

For the years ended

As of December 31,

December 31,

Location of Farm (2)

    

2023

    

2022

    

2023

    

2022

 

Corn Belt

33.6

%

28.7

%

37.7

%

34.3

%

Delta and South

19.9

%

19.9

%

11.9

%

12.5

%

High Plains

16.4

%

20.0

%

9.1

%

8.4

%

Southeast

21.7

%

24.4

%

18.6

%

19.2

%

West Coast

8.4

%

7.0

%

22.7

%

25.6

%

100.0

%

100.0

%

100.0

%

100.0

%

(1)Due to regional disparities in the use of leases with variable rent and seasonal variations in the recognition of variable rent revenue, regional comparisons by rental income are more relevant for full years than quarters or partial years.
(2)Corn Belt includes farms located in Illinois, Indiana, Iowa, Missouri and eastern Nebraska. Delta and South includes farms located in Arkansas, Louisiana, Mississippi and Oklahoma. High Plains includes farms located in Colorado, Kansas and Texas. Southeast includes farms located in Florida, North Carolina and South Carolina. West Coast includes farms located in California.

Note 4—Related Party Transactions

On July 21, 2015, the Company entered into a lease agreement with American Agriculture Aviation LLC (“American Ag Aviation”) for the use of a private plane. American Ag Aviation is a Colorado limited liability company that is owned 100% by Paul A. Pittman, the Company’s Executive Chairman. The private plane was generally utilized when commercial air travel was not readily available or practical to and from a particular location. The Company paid costs of $0.03 million and $0.11 million during the years ended December 31, 2023 and 2022, respectively, to American Ag Aviation for use of the aircraft in accordance with the lease agreement. These costs were recognized based on the nature of the associated use of the aircraft consistently with other travel expenses, as follows:

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)(continued)

(i) general and administrative - expensed as general and administrative expenses within the Company’s consolidated statements of operations; (ii) land acquisition (accounted for as an asset acquisition) - allocated to the acquired real estate assets within the Company’s consolidated balance sheets; and (iii) land acquisition (accounted for as a business combination) - expensed as acquisition and due diligence costs within the Company’s consolidated statements of operations. In November 2023, the lease agreement was terminated due to American Ag Aviation’s disposition of its private plane.

On January 20, 2021, the Company entered into property sale and long-term management agreements with the OZ Fund. The OZ Fund is a Delaware limited liability company whose manager is the brother of Thomas P. Heneghan, one of the Company's independent directors. Mr. Heneghan has an indirect investment in the OZ Fund. As of December 31, 2023 and 2022, the Company had a 9.97% interest, for both periods, in the OZ Fund. The aggregate balance of the Company’s equity method investment in the OZ Fund was approximately $4.1 million and $4.2 million as of December 31, 2023 and 2022, respectively, including aggregate capital contributions of $1.7 million for both periods, and aggregate distributions of less than $0.1 million and $0.0 million, respectively, from inception of the joint venture through December 31, 2023 and 2022, respectively. The Company’s capital contributions are capped at $4.3 million. The Company earned management fees of $0.5 million and $0.4 million during the years ended December 31, 2023 and 2022, respectively.

Note 5—Real Estate

During the year ended December 31, 2023, the Company completed acquisitions consisting of four properties in the Corn Belt and Delta and South regions. Aggregate cash consideration for these acquisitions totaled $22.2 million. No intangible assets were acquired through these acquisitions.

During the year ended December 31, 2022, the Company completed 17 acquisitions, consisting of 20 properties, in the Corn Belt and High Plains regions. Aggregate cash consideration for these acquisitions totaled $54.4 million for real estate purchases accounted for as asset acquisitions plus $17.3 million for the purchase of land and buildings for four agriculture equipment dealerships in Ohio leased to Ag Pro under the John Deere brand which are accounted for as financing receivables (refer to See “Note 6—Loans and Financing Receivables”). No intangible assets were acquired through these acquisitions.

During the year ended December 31, 2023, the Company completed dispositions consisting of 74 properties in the Corn Belt, Delta and South, High Plains, Southeast and West Coast regions. The Company received $195.5 million in aggregate consideration, including $11.8 million in seller financing, and recognized an aggregate gain on sale of $36.1 million. In addition, the Company deferred an additional net gain on sale of $2.1 million in connection with dispositions of certain properties with seller financing. The deferred gain will be recognized at such time as the Company considers collection of the seller-financed portion of the sale price to be probable under applicable accounting standards.

During the year ended December 31, 2022, the Company completed five dispositions consisting of five properties in the Corn Belt, High Plains and Southeast regions. The Company received cash consideration for these dispositions totaling $17.0 million and recognized an aggregate gain on sale of $2.6 million.

Note 6—Loans and Financing Receivables

The Company offers an agricultural lending product focused on farmers as a complement to the Company’s business of acquiring and owning farmland and leasing it to farmers. Under the FPI Loan Program, the Company makes loans to third-party farmers (both tenant and non-tenant) to provide financing for property acquisitions, working capital requirements, operational farming activities, farming infrastructure projects and for other farming and agricultural real estate related projects. The Company seeks to make loans that are collateralized by farm real estate or growing crops and in principal amounts of $1.0 million or more at fixed interest rates with maturities of up to six years. The Company expects the borrower to repay the loans in accordance with the loan agreements based on farming operations and access to other forms of capital, as permitted.

In addition to loans made under the FPI Loan Program, the Company, on certain occasions, makes short-term loans to tenants secured by collateral other than real estate, such as growing crops, equipment or inventory, when the Company believes such loans will ensure the orderly completion of farming operations on a property owned by the Company for a given crop year and other credit is not available to the borrower.

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Farmland Partners Inc.

Notes to Consolidated Financial Statements (continued)

Geographic Risk

The following table summarizes the percentage of approximate total acres owned as of December 31, 2020 and 2019, and straight line and crop share rental income recorded byOn November 18, 2022, the Company acquired land and buildings for four agriculture equipment dealerships in Ohio leased to Ag Pro (the seller), under the John Deere brand. In accordance with ASC Topic 842, control is not considered to have transferred to the Company under GAAP and these transactions are accounted for as financing arrangements under ASC 310 “Receivables” rather than as investments in real estate subject to operating leases. The leases mature in November 2037 and contain renewal options for periods up to 20 years from the original maturity date. The discount used for the years then ended by location of the farm:

Approximate % of Total Acres

Rental Income

As of December 31,

For the year ended December 31,

Location of Farm

2020

    

2019

2020

    

2019

 

Alabama

0.4

%

0.4

%

0.2

%

0.2

%

Arkansas

8.9

%

9.1

%

4.2

%

4.4

%

California

7.5

%

7.3

%

32.6

%

34.6

%

Colorado

15.8

%

15.5

%

5.7

%

5.4

%

Florida

3.0

%

3.0

%

2.5

%

2.1

%

Georgia

3.4

%

3.4

%

2.3

%

2.1

%

Illinois

24.7

%

24.5

%

26.7

%

24.5

%

Kansas

1.3

%

1.2

%

0.4

%

0.3

%

Louisiana

5.5

%

5.3

%

3.1

%

3.1

%

Michigan

0.4

%

0.3

%

0.4

%

0.8

%

Mississippi

2.8

%

3.1

%

1.8

%

1.7

%

North Carolina

10.7

%

10.5

%

7.8

%

7.4

%

Nebraska

3.8

%

3.8

%

3.3

%

3.3

%

South Carolina

9.9

%

9.5

%

8.0

%

8.2

%

South Dakota

1.1

%

1.0

%

0.4

%

0.8

%

Texas

0.0

%

1.3

%

0.2

%

0.7

%

Virginia

0.8

%

0.8

%

0.4

%

0.4

%

100.0

%

100.0

%

100.0

%

100.0

%

Note 4—Related Party Transactions

On July 21, 2015, the Company entered into a lease agreement with American Agriculture Aviation LLC (“American Ag Aviation”) for the use of a private plane.  American Ag Aviation is a Colorado limited liability company that is owned 100% by Mr. Pittman, the Company’s CEO.  During the years ended December 31, 2020 and 2019, the Company incurred costs of $0.1 million and $0.1 million, respectively, from American Ag Aviation for use of the aircraft in accordance with the lease agreement. These costs were recognized based on the nature of the associated use of the aircraft, as follows: (i) general and administrative - expensed as general and administrative expenses within the Company’s Consolidated Statements of Operations; (ii) land acquisition (accounted for as an asset acquisition) - allocated to the acquired real estate assets within the Company’s consolidated balance sheets; and (iii) land acquisition (accounted for as a business combination) - expensed as acquisition and due diligence costs within the Company’s Consolidated Statements of Operations. As of December 31, 2020 and 2019 the Company had outstanding payables to American Agriculture Aviation LLC of $0.01 million and $0.01 million, respectively.

Note 5—Real Estatetransactions was 6.15%.

As of December 31, 2020,2023 and 2022, the Company owned approximately 155,000 acres.held the following loans and financing receivables:

During the year ended December 31, 2020, the Company completed 3 acquisitions which were accounted for as asset acquisitions in Illinois and Michigan. Aggregate consideration for these acquisitions totaled $1.4 million and was comprised of $0.9 million in cash and a $0.5 million reduction in notes receivable and related interest to the seller through the acquisition of collateralized property. NaN intangible assets were acquired through these acquisitions.

($ in thousands)

Outstanding as of

Maturity

Loan

    

Terms

    

December 31, 2023

    

December 31, 2022

    

Date

Loans under FPI Loan Program:

Mortgage Note (1)

Principal & interest due at maturity

$

210

$

217

12/7/2028

Mortgage Note (2)

Principal due at maturity & interest due semi-annually

2,100

8/18/2023

Mortgage Note (3)

Principal due at maturity & interest due quarterly

1,900

2,500

3/3/2025

Mortgage Note (4)

Principal due at maturity & interest due quarterly

1,800

11/17/2028

Mortgage Note (5)

Principal due at maturity & interest due semi-annually

8,009

12/28/2024

Mortgage Note (6)

Principal due at maturity & interest due semi-annually

1,491

12/28/2024

Mortgage Note (7)

Principal due at maturity & interest due monthly

500

6/30/2025

Total outstanding principal

13,910

4,817

Sale-leaseback transactions accounted for as financing arrangements:

Financing Receivable, net (8)

Monthly payments in accordance with lease agreement

5,920

5,894

11/17/2037

Financing Receivable, net (8)

Monthly payments in accordance with lease agreement

4,498

4,498

11/17/2037

Financing Receivable, net (8)

Monthly payments in accordance with lease agreement

3,563

3,561

11/17/2037

Financing Receivable, net (8)

Monthly payments in accordance with lease agreement

3,237

3,241

11/17/2037

Total financing receivable

17,218

17,194

Interest receivable (net prepaid interest and points)

60

2

Allowance for credit losses

(168)

(92)

Provision for interest receivable

Total Loans and financing receivables, net

$

31,020

$

21,921

1)The original note was renegotiated and a second note was entered into simultaneously with the borrower during the three months ended March 31, 2017. The note is secured against farmland properties.
2)On August 18, 2021, the Company entered into a loan secured against farmland.The loan was repaid in full in September 2023.
3)On March 3, 2022, the Company entered into two loans with the same party secured against farmland.
4)On November 17, 2023, the Company entered into a loan agreement secured by farmland.
5)On December 28, 2023, the Company entered into a loan agreement secured by farmland.
6)On December 28, 2023, the Company entered into a loan agreement secured by farmland.
7)On December 28, 2023, the Company entered into a loan agreement secured by farmland and a feedlot.
8)On November 18, 2022, the Company acquired land and buildings for four agriculture equipment dealerships in Ohio, accounted for as financing transactions.The leases may be extended beyond the stated maturity date, for up to an additional 20 years, at the option of the tenant.

During the year ended December 31, 2020, the Company completed 7 dispositions consisting of 11 farms in Texas, Illinois, Nebraska, Arkansas,Loans and Mississippi. Cash receipts totaled $20.1 million with a total gain on sale of $3.2 million.

F-20

Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)

During the year ended December 31, 2019, the Company completed 2 acquisitions which were accounted for as asset acquisitions in Illinois and Colorado. Aggregate consideration for these acquisitions totaled $3.3 million and was comprised of $1.4 million in cash and a $1.9 million reduction in notes receivable and related interest to the seller through the acquisition of collateralized property. NaN intangible assets were acquired through these acquisitions.

During the year ended December 31, 2019, the Company completed 4 dispositions consisting of 7 farms in Illinois, Michigan, Florida, and Arkansas. Cash receipts totaled $35.1 million with a total gain on sale of $7.9 million.

Note 6—Notes Receivable

In August 2015, the Company introduced an agricultural lending product aimed at farmers as a complement to the Company’s business of acquiring and owning farmland and leasing it to farmers (the “FPI Loan Program”).  Under the FPI Loan Program, the Company makes loans to third-party farmers (both tenant and non-tenant) to provide financing for working capital requirements and operational farming activities, farming infrastructure projects and for other farming and agricultural real estate related projects. The Company seeks to make loans that are collateralized by farm real estate or growing crops and in principal amounts of $0.1 million or more at fixed interest rates with maturities of up to six years. The Company expects the borrower to repay the loans in accordance with the loan agreements based on farming operations and access to other forms of capital, as permitted.  

In addition to loans made under the FPI Loan Program, the Company, on certain occasions, makes short-term loans to tenants secured by collateral other than real estate, such as growing crops, equipment or inventory, when the Company believes such loans will ensure the orderly completion of farming operations on a property owned by the Company for a given crop year and other credit is not available to the borrower.

Notes receivablereceivables are stated at their unpaid principal balance and include unamortized direct origination costs and accrued interest through the reporting date, less any allowance for losses and unearned borrower paid points. The Company monitors its receivables based upon historical collection experience, collateral values, current trends, long-term probability of default (“PD”) and current trends.estimated loss given default (“LGD”). Accrued interest write-offs are recognized as credit loss expense. The Company’s estimateCompany has estimated its credit losses in accordance with ASC 326 to be $0.1 million and $0.0 million on its loan balances as of expectedDecember 31, 2023 and 2022, respectively, and approximately $0.1 million of allowance for credit losses on its notes receivable principal balance is $0.0 millionfinancing receivables as of December 31, 20202023 and December 31, 2019.2022. The Company recorded $0.00 million and $0.20 million ofno credit loss expense related to interest receivables during the twelve monthsyears ended December 31, 20202023 and 2019,2022, respectively. There were no charge-offs or recoveries for the years ended December 31, 2023 and 2022. In addition, as of December 31, 2023, all payments under loans and financing receivables have been received in accordance with the agreements.

AsThe following tables details the allowance for credit losses as of December 31, 20202023 and 2019, the Company held the following notes receivable:2022:

($ in thousands)

Principal Outstanding as of

Loan

    

Payment Terms

    

December 31, 2020

    

December 31, 2019

    

Maturity

Mortgage Note (1)

Principal & interest due at maturity

$

-

$

1,804

1/15/2017

Mortgage Note (2)

Principal & interest due at maturity

229

234

12/7/2028

Mortgage Note (2)

Principal due at maturity & interest due monthly

2,135

2,145

3/16/2022

Mortgage Note (3)

Principal & interest due at maturity

-

62

3/1/2020

Line of Credit (3)

Principal & interest due at maturity

-

369

3/1/2020

Total outstanding principal

2,364

4,614

Interest receivable (net prepaid interest)

277

565

Provision for loan receivable

(293)

(412)

Total notes and interest receivable

$

2,348

$

4,767

(1)

December 31, 2023

($ in thousands)

Amortized Cost

Allowance

Loans and financing
receivables, net

Allowance as a %
of Amortized Cost

Loans under FPI Loan Program

$

13,970

$

(76)

$

13,894

0.54

%

Financing Receivables

17,218

(92)

17,126

0.53

%

Totals

$

31,188

$

(168)

$

31,020

0.54

%

In January 2016 the maturity date of the note was extended from January 15, 2016 to January 15, 2017 with the year 1 interest received at the time of the extension and principal and remaining interest due at maturity. On July 28, 2017 the Company notified the borrower of default on the Promissory Note. In December 2019, the Company began the process of selling the underlying collateralized property to settle the principal and accrued interest. The note was settled during the three months ended June 30, 2020.

F-21F-22

Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)(continued)

(2)

The original note was renegotiated and a second note was entered into simultaneously with the borrower during the three months ended March 31, 2017. The notes include mortgages on 2 additional properties in Colorado that include repurchase options for the properties at a fixed price that are exercisable between the third and fifth anniversary of the notes by the borrower.

(3)

This note was repaid in full during the three months ended March 31, 2020.

December 31, 2022

($ in thousands)

Amortized Cost

Allowance

Loans and financing
receivables, net

Allowance as a %
of Amortized Cost

Loans under FPI Loan Program

$

4,819

$

$

4,819

%

Financing Receivables

17,194

(92)

17,102

0.54

%

Totals

$

22,013

$

(92)

$

21,921

0.42

%

The following chart reflects the roll-forward of the allowance for credit losses for our loans and financing receivables for the years ended December 31, 2023 and 2022:

Years ended December 31,

($ in thousands)

2023

2022

Balance at beginning of year

$

(92)

$

Initial allowance for financing receivables

(92)

Initial allowance for loan receivables

(76)

Current period change in credit allowance

Charge-offs

Recoveries

Balance at end of year

$

(168)

$

(92)

A reconciliation of the carrying amount of mortgage loans receivable and financing receivables for the years ended December 31, 20202023 and 20192022 is set out below:

Years ended December 31,

2020

2019

Years ended December 31,

($ in thousands)

2023

2022

Balance at beginning of year

$

4,614

$

11,159

$

22,011

$

6,029

Additions during year:

New mortgage loans and additional advances on existing loans

8

1,781

Interest income added to principal

-

-

Amortization of discount

-

-

Issuance of loans and financing receivables

11,801

20,781

Interest accrued on financing receivables

1,054

122

4,622

12,940

34,866

26,932

Deductions during year:

Collection of principal

451

8,285

Foreclosure

1,807

41

Collections of principal on loans

2,707

2,786

Payments on financing receivables

1,031

Expiration of repurchase option

2,135

Balance at end of year

$

2,364

$

4,614

$

31,128

$

22,011

The collateral for the mortgage notes receivable consists of real estate and improvements present on such real estate.  For income tax purposes the aggregate cost of the investment of the mortgage notes is the carrying amount per the table above.personal property.

Fair Value

FASB ASC 820-10 establishes a three-level hierarchy for disclosure of fair value measurements. The valuation hierarchy is based upon the transparency of inputs to the valuation of an asset or liability as of the measurement date. The three levels are defined as follows:

Level 1—Inputs to the valuation methodology are quoted prices for identical assets or liabilities in active markets.

Level 2—Inputs to the valuation methodology include quoted prices for similar assets and liabilities in active markets and inputs that are observable or can be substantially corroborated for the asset or liability, either directly or indirectly.

Level 3—Inputs to the valuation methodology are unobservable, supported by little or no market activity.

The Company estimates the fair value of notes receivable is valuedloans and financing receivables using Level 3 inputs under the hierarchy established by GAAP andGAAP. Fair value is calculated based on a discountedestimated by discounting cash flow analysis,flows using interest rates based on management’s estimates of market interest rates on mortgage notesloans receivable with comparable terms and credit risk whenever the interest rates on the notesloans receivable are deemed not to be at market rates. The fair value for financing receivables does not take into consideration any residual value upon the end of the lease term. As of December 31, 20202023 and 2019,2022, the fair value of the notes receivableloans and financing receivables was $2.4$24.5 million and $4.6$19.6 million, respectively.

F-22F-23

Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)(continued)

Note 7—Mortgage Notes, Lines of Credit and Bonds Payable

As of December 31, 20202023 and 2019,2022, the Company had the following indebtedness outstanding:

Annual Interest

Book Value of

Book

Rate as of

Principal Outstanding as of

Collateral

Annual

 Value of

($ in thousands)

December 31,

December 31,

as of December 31,

($ in thousands)

Interest

Principal

Collateral

Rate as of

Next

Outstanding as of

as of

Interest

December 31,

Interest Rate

Adjustment

December 31,

December 31,

Maturity

December 31,

Loan

    

Payment Terms

    

Interest Rate Terms

    

2020

    

2020

    

2019

    

Maturity

    

2020

    

2019

  

Payment Terms

  

2023

  

Terms

  

Date

  

2023

  

2022

  

Date

  

2023

Farmer Mac Bond #6

Semi-annual interest only

3.69%

3.69%

13,827

13,827

April 2025

$

21,441

$

21,441

Semi-annual

3.69%

Fixed

N/A

$

13,827

$

13,827

April 2025

$

19,478

Farmer Mac Bond #7

Semi-annual interest only

3.68%

3.68%

11,160

11,160

April 2025

18,570

18,570

Semi-annual

3.68%

Fixed

N/A

11,160

11,160

April 2025

8,258

Farmer Mac Bond #8A (1)

Semi-annual interest only

3.20%

3.20%

-

41,700

June 2020

74,310

Farmer Mac Bond #9 (1)

Semi-annual interest only

3.35%

3.35%

-

6,600

July 2020

7,940

MetLife Term Loan #1 (2)

Semi-annual interest only

3.30% adjusted every three years

3.30%

85,188

87,942

March 2026

190,768

195,615

MetLife Term Loan #2

Semi-annual interest only

4.27% adjusted every three years

4.27%

16,000

16,000

March 2026

32,323

32,199

MetLife Term Loan #3

Semi-annual interest only

4.27% adjusted every three years

4.27%

21,000

21,000

March 2026

27,817

27,817

MetLife Term Loan #4 (2)

Semi-annual interest only

3.30% adjusted every three years

3.30%

15,685

15,685

June 2026

31,266

31,266

Farmer Mac Facility

Monthly

6.84%

SOFR + 1.50%

N/A

30,000

75,000

December 2025

92,672

MetLife Term Loan #1

Semi-annual

5.55%

Fixed

N/A

72,585

72,623

March 2026

102,171

MetLife Term Loan #4

Semi-annual

5.55%

Fixed for 3 years

March 2026

5,756

9,880

June 2026

9,534

MetLife Term Loan #5

Semi-annual interest only

3.50% adjusted every three years

3.50%

8,379

8,379

January 2027

14,281

14,281

Semi-annual

5.63%

Fixed for 3 years

January 2026

5,179

5,179

January 2027

7,383

MetLife Term Loan #6

Semi-annual interest only

3.45% adjusted every three years

3.45%

27,158

27,158

February 2027

58,087

58,087

Semi-annual

5.55%

Fixed for 3 years

February 2026

21,726

21,726

February 2027

26,230

MetLife Term Loan #7

Semi-annual interest only

3.20% adjusted every three years

3.20%

17,153

17,153

June 2027

39,470

39,126

Semi-annual

5.87%

Fixed for 3 years

June 2026

15,434

15,699

June 2027

29,684

MetLife Term Loan #8

Semi-annual interest only

4.12% fixed until 2027

4.12%

44,000

44,000

December 2042

110,042

110,042

Semi-annual

4.12%

Fixed for 10 years

December 2027

44,000

44,000

December 2042

110,042

MetLife Term Loan #9

Semi-annual interest only

4.19% adjusted every three years

4.19%

21,000

21,000

May 2028

41,339

41,223

Semi-annual

3.20%

Fixed for 3 years

May 2024

16,800

16,800

May 2028

33,720

MetLife Term Loan #10 (4)

Semi-annual interest only

3.00% adjusted every three years

3.00%

53,277

October 2030

112,258

Farm Credit of Central Florida (1)

(3)

LIBOR + 2.6875% adjusted monthly

2.94%

4,890

September 2023

14,745

Rabobank

Semi-annual interest only

LIBOR + 1.70% adjustable every three years

1.85%

62,358

64,358

March 2028

131,819

135,432

Rutledge Note Payable #1 (5)

Quarterly interest only

3 month LIBOR + 1.3% adjusted quarterly

1.56%

17,000

17,000

January 2022

29,857

29,820

Rutledge Note Payable #2 (5)

Quarterly interest only

3 month LIBOR + 1.3% adjusted quarterly

1.56%

25,000

25,000

January 2022

40,403

39,468

Rutledge Note Payable #3 (5)

Quarterly interest only

3 month LIBOR + 1.3% adjusted quarterly

1.56%

25,000

25,000

January 2022

48,164

45,764

Rutledge Note Payable #4 (5)

Quarterly interest only

3 month LIBOR + 1.3% adjusted quarterly

1.56%

15,000

15,000

January 2022

29,226

29,170

Rutledge Note Payable #5 (5)

Quarterly interest only

3 month LIBOR + 1.3% adjusted quarterly

1.56%

30,000

30,000

January 2022

84,406

85,287

MetLife Term Loan #10

Semi-annual

6.36%

Fixed

N/A

48,986

48,985

October 2030

94,737

MetLife Term Loan #11

Semi-annual

2.85%

Fixed for 3 years

October 2024

12,750

12,750

October 2031

27,497

MetLife Term Loan #12

Semi-annual

3.11%

Fixed for 3 years

December 2024

14,359

14,359

December 2031

14,784

MetLife Facility

Quarterly

7.50%

SOFR + 2.10%

N/A

October 2027

112,466

Rabobank (1)

Semi-annual

7.16%

SOFR + 1.81%

March 2024 (2)

45,533

59,500

March 2028

90,234

Rutledge Facility

Quarterly

7.19%

SOFR + 1.80%

April 2024 (2)

5,000

18,000

March 2027

180,332

Total outstanding principal

Total outstanding principal

508,185

512,852

$

1,061,537

$

1,051,603

363,095

439,488

$

959,222

Debt issuance costs

Debt issuance costs

(1,560)

(1,449)

(2,236)

(2,613)

Unamortized premium, net of amortization

-

-

Unamortized premium

Total mortgage notes and bonds payable, net

Total mortgage notes and bonds payable, net

$

506,625

$

511,403

Total mortgage notes and bonds payable, net

$

360,859

$

436,875

(1)On October 29, 2020,The Company has an interest rate swap agreement with Rabobank for $33.2 million notional of fixed SOFR at 2.114% until March 2026 for a weighted average rate of approximately 4.7% (see “Note 10—Hedge Accounting”). After adjusting the Company entered into a $54.4$33.2 million term loan with MetLife (MetLife Term Loan #10),of swapped Rabobank debt as fixed rate debt, the proceedsratio of which were usedfloating rate debt to refinance this indebtedness.total debt decreased from 22.2% to 13.0%.
(2)DuringThe adjustment date included in the year ended December 31, 2017table above is for the Company converted the interest rate on Metlife Term Loans 1 and 4 from variable to fixed rates for a term of three years. Once the term expires the new rate will be determined based on the loan agreements.
(3)Loan is an amortizing loan with quarterly interest payments that commenced on January 1, 2017 and quarterly principal payments that commence on October 1, 2018, with all remaining principal and outstanding interest due at maturity. This loan was paid down entirely on October 29, 2020 through a refinancing and subsequent issuance of MetLife Term Loan #10.
(4)Loan was issued on October 29, 2020 as part of a refinancing that paid down the outstanding principal and interest on Farmer Mac Bond 8A, Farmer Mac Bond 9, and Farm Credit of Central Florida.
(5)On January 29, 2021 the Rutledge Facility maturity was extended to April 1, 2022spread noted under “Interest Rate Terms.”

F-23

Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)

Farmer Mac FacilityDebt

 

As of December 31, 20202023 and December 31, 2019,2022, the Operating Partnership had $25.0approximately $55.0 million and $73.3$100.0 million, respectively, in aggregate principal amount outstanding under the bond purchase agreement entered into in October 2022 (the “Farmer Mac Facility”) with Federal Agricultural Mortgage Corporation and its wholly owned subsidiary, Farmer Mac Mortgage Securities Corporation (collectively, “Farmer Mac”), and $43.1 million and $0.0 million, respectively, in additional capacity available under the Farmer Mac facility.Facility. The Farmer Mac facilitydebt is secured by loans which are, in turn, secured by first-lien mortgages on agricultural real estate owned by wholly owned subsidiaries of the Operating Partnership. While Farmer Mac Bond #6 and Farmer Mac Bond #7 bear fixed interest rates of 3.69% and 3.68%, respectively, the Farmer Mac Facility bears interest of one-month term SOFR + 1.50% on drawn amounts and an unused commitment fee of 0.20%. In connection with the agreements, the Company entered into a guaranty agreement whereby the Company agreed to guarantee the full performance of the Operating Partnership’s duties and obligations under the Farmer Mac debt. The Farmer Mac debt is subject to the Company’s ongoing compliance with a number of customary affirmative and negative covenants, as well as financial covenants, including:  a maximum leverage ratio of not more than 60%; a minimum fixed charge coverage ratio of 1.50 to 1.00; and a minimum tangible net worth requirement.. The Company was in compliance with all applicable covenants at December 31, 2020.2023. In addition, under the Farmer Mac Facility, the Operating Partnership may request that Farmer Mac purchase additional bonds up to an additional $200.0 million, which Farmer Mac may approve at its sole discretion.

MetLife Term LoansDebt

As of December 31, 20202023 and December 31, 2019,2022, the Company and the Operating Partnership had $308.8$257.6 million and $258.3$262.0 million in aggregate principal amount outstanding, respectively, (the “Metlife loans”), under the loancredit agreements between MetLife and certain of the Operating Parnterhip’sCompany’s subsidiaries and Metropolitan Life Insurance Company (“MetLife”) (together,(collectively, the “MetLife loancredit agreements”). Each of the MetLife loancredit agreements contains a number of customary affirmative and negative covenants, including the requirement to maintain a loan to value ratio of no greater than 60%.

In connectionThe Company also has a $75.0 million credit facility with each of the MetLife loan agreements,that provides the Company and the Operating Partnership each entered into separate guarantees whereby the Company and the Operating Partnership jointly and severally agreewith access to unconditionally guarantee the obligations under the Metlife loan agreements (the “MetLife guarantees”). The MetLife guarantees containadditional liquidity on a numberrevolving credit basis at a floating rate of customary affirmative and negative covenants. 

The Company was in compliance with all covenants under the MetLife loan agreements and MetLife guarantees asinterest equal to SOFR plus 210 basis points. As of December 31, 2020.

Each of the MetLife loan agreements includes certain customary events of default, including a cross-default provision related to other outstanding indebtedness of the borrowers, the Company2023, no amounts had been borrowed and the Operating Partnership, the occurrence of which, after any applicable cure period, would permit MetLife, among other things, to accelerate payment of all amounts outstanding$75.0. million remained available under the MetLife loans and to exercise its remedies with respect to the pledged collateral, including foreclosure and salesenior secured revolving line of the Company’s properties that collateralize the MetLife loans.

On October 29, 2020, certain wholly owned subsidiaries of the Operating Partnership,credit entered into a loan agreement with MetLife, which provides for a term loan of $54.4 million (“Term Loan 10”). The proceeds of Term Loan 10 was used to repay certain existing debt with near-term maturities. Term Loan 10 matures on October 22, 2030 and is secured by first and senior lien mortgages on certain of the Company’s properties.

Interest on Term Loan 10 is payable in cash semi-annually and accrues at an initial rate of 3.00% per annum, which may be adjusted by MetLife on each of October 1, 2023, October 1, 2026 and October 1, 2029 to an interest rate agreed upon between the borrower’s subsidiaries and MetLife. If no such agreement exists on the third business day prior to the scheduled adjustment, the interest rate will then be adjusted to a rate consistent with interest rates quoted by MetLife for substantially similar loans secured by real estate substantially similar to the Company’s properties securing Term Loan 10.

Subject to certain conditions, up to 50% of the original principal amount of Term Loan 10 may be prepaid without premium or penalty in any calendar year. Additionally, the entire unpaid principal balance of Term Loan 10 may be prepaid without premium or penalty during the 75 day period following a rate adjustment or during the 30 day period preceding October 22, 2030. Any other prepayments under Term Loan 10 generally are subject to a minimum prepayment premium of 1.00%.

The Term Loan 10 loan agreement includes certain customary events of default, including a cross-default provision related to other outstanding indebtedness of the borrower subsidiaries, the Company and the Operating Partnership, the occurrence of which, after any applicable cure period, would permit MetLife, among other things, to accelerate payment

F-24

Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)(continued)

of all amounts outstanding under Term Loan 10 and to exercise its remedies with respect to the pledged collateral, including foreclosure and sale of the Company’s properties that collateralize Term Loan 10.

In connection with Term Loan 10, on October 29, 2020, the Company and the Operating Partnership each entered into a separate guarantee whereby the Company and the Operating Partnership jointly and severally agreed to unconditionally guarantee all of the borrower subsidiaries’ obligations under the Term Loan 10 loan agreement.

Farm Credit of Central Florida Mortgage Note

Partnership with MetLife in October 2022 (the “MetLife Facility”). As of December 31, 2020 and December 31, 2019, the Company and the Operating Partnership had $0.0 million and $4.9 million outstanding, respectively, and approximately $5.1 million had been drawn down under the Farm Credit mortgage note facility. Proceeds from the Farm Credit mortgage note were used for the development of additional properties.

On October 29, 2020, the proceeds of a refinancing with MetLife were used to repay all outstanding principal and interest on this note.

Rutledge Credit Facility

As of December 31, 2020 and December 31, 2019, the Company and the Operating Partnership had $112.0 million outstanding under the Rutledge facility. As of December 31, 2020, $0 remains available under this facility and2023, the Company was in compliance with all covenants under the Rutledge loan agreements.MetLife credit agreements and MetLife guarantees.

In connectionOn each adjustment date for MetLife Term Loans #1-10, MetLife may, at its option, adjust the rate of interest to any rate of interest determined by MetLife consistent with rates for substantially similar loans secured by real estate substantially similar to the collateral. For MetLife Term Loan #11, the interest rate will be adjusted to the greater of the three-year U.S. treasury rate plus 2.20% or 2.85%. For MetLife Term Loan #12, the interest rate will be adjusted to the greater of the three-year U.S. treasury rate plus 2.10% or 2.75%. At the time of rate adjustment, the Company may make a prepayment equal to the unpaid principal balance for each of the Rutledge loan agreements,MetLife loans.  Otherwise, the Company andmay make a prepayment equal to 20% to 50% of the Operating Partnership each entered into separate guarantees wherebyunpaid principal balance (depending on the Company and the Operating Partnership jointly and severally agree to unconditionally guarantee the obligations under the Rutledge loan agreements (the “Rutledge guarantees”). The Rutledge guarantees containtranche of debt) during a number of customary affirmative and negative covenants.calendar year without penalty.

Rabobank Mortgage Note

As of December 31, 20202023 and December 31, 2019,2022, the Company and the Operating Partnership had $62.4$45.5 million and $64.4$59.5 million in aggregate principal amount outstanding, respectively, under thea mortgage note with Rabobank mortgage note.(the “Rabobank Mortgage Note”). The Company was in compliance with all covenants under the Rabobank mortgage noteMortgage Note as of December 31, 2020.2023.

Rutledge Facility

As of December 31, 2023 and 2022, the Company and the Operating Partnership had $5.0 million and $18.0 million in aggregate principal amount, respectively, outstanding under a credit agreement with Rutledge Investment Company (“Rutledge”) referred to herein as the Rutledge Facility. Each February, the facility size decreases by 2.5% of original total facility size. As a result of that decrease, in addition to further reductions in connection with the disposition of certain properties that served as collateral for the Rutledge Facility, the total facility size was $88.0 million as of December 31, 2023. As of December 31, 2023, $83.0 million remained available under this facility and the Company was in compliance with all covenants under the loan agreements relating to the Rutledge Facility.

The interest rate for the credit facility is based on three-month SOFR, plus an applicable margin. The applicable margin for the credit facility is 1.80% to 2.25%, depending on the applicable pricing level in effect. As of April 1, 2023, the applicable margin is 1.80%. Generally, the Rutledge Facility contains terms consistent with the Company’s prior loans with Rutledge, including, among others, the representations and warranties, affirmative, negative and financial covenants and events of default.

In connection with the Rutledge agreement, the Company and the Operating Partnership each entered into separate guarantees whereby the Company and the Operating Partnership jointly and severally agreed to unconditionally guarantee the obligations under the Rutledge Facility (the “Rutledge guarantees”). The Rutledge guarantees contain a number of customary affirmative and negative covenants.

LIBOR

On July 1, 2023, the Rabobank Mortgage Note, the Company’s only remaining indebtedness with a maturity date beyond 2023 that had exposure to LIBOR, is expectedwas converted to be discontinued after 2021. Asa SOFR-based instrument. Accordingly, as of December 31, 2020,2023, the Company had $174.4 milliondid not have any indebtedness with a maturity date beyond 2023 that has exposure to LIBOR.

Debt Issuance Costs

Costs incurred by the Company in obtaining debt are deducted from the face amount of variable- rate debt outstanding withmortgage notes and bonds payable. Debt issuance costs are amortized using the straight-line method, which approximates the effective interest rates tied to LIBOR and maturity dates beyond 2021. There can be no assurances as to whatmethod, over the alternative base rate will berespective terms of the related indebtedness. Any unamortized amounts upon early repayment of mortgage notes payable are written off in the event that LIBOR is discontinued,period in which repayment occurs. Fully amortized deferred financing fees are removed from the balance sheet upon maturity or repayment of the underlying debt. Accumulated amortization of deferred financing fees was $1.9 million and the Company can provide no assurances whether that base rate will be more or less favorable than LIBOR. The Company intends to monitor the developments with respect to the phasing out$1.2 million as of LIBOR after 2021December 31, 2023 and work with its lenders to ensure that any transition away from LIBOR will have minimal impact on its financial condition, but can provide no assurances regarding the impact of LIBOR discontinuation.2022, respectively.

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Aggregate Maturities

As of December 31, 2020,2023, aggregate maturities of long-term debt for the succeeding years are as follows:

($ in thousands)

Year Ending December 31,

    

Future Maturities

Year Ending December 31,

    

Future Maturities

 

2021

$

2022

112,000

2023

2024

 

2,100

$

2,100

2025

27,087

57,087

2026

 

80,441

2027

49,439

2028

53,933

Thereafter

366,998

120,095

$

508,185

$

363,095

Fair Value

The fair value of the mortgage notes payable is valued using Level 3 inputs under the hierarchy established by GAAP and is calculated based on a discounted cash flow analysis, using interest rates based on management’s estimates of market interest rates on long-term debt with comparable terms whenever the interest rates on the mortgage notes payable are deemed not to be at market rates. As of December 31, 20202023 and 2019,2022, the fair value of the mortgage notes payable was $535.1$349.1 million and $518.9$405.0 million, respectively.

Note 8—Commitments and Contingencies

The Company is not currently subject to any known material contingencies arising from its business operations, nor to any material known or threatened litigation other than as discussed below.

In April 2015, theOffice Leases

The Company entered into a lease agreementhas five leases in place for office space which the Company extended in March 2020 through July 31, 2021. Thewith payments ranging between $800 and $13,711 per month and lease commenced June 1, 2015terms expiring between November 2024 and had an initial monthly payment of $10,032, which increased to $10,200 in June 2016, $10,366 in June 2017, $10,534 in June 2018, $10,701 in June 2019 and $12,373 in August 2020.November 2025. Beginning in 2019,2020, the Company recognized right of use assets and related lease liabilities in the consolidated balance sheets. The Company estimated the value of the lease liabilities using a discount raterates ranging from 3.35% to 7.56%, equivalent to the raterates we would pay on a secured borrowing with similar terms to the lease at the inception of the lease. Options to extend the lease are excluded in our minimum lease terms unless the option is reasonably certain to be exercised are excluded.exercised. Our total lease cost for the years ended December 31, 20202023 and 20192022 was $0.1$0.23 million and $0.1$0.24 million, respectively. As of December 31, 2020, the lease has a remaining term of 8 months and a discount rate of 3.35%. On December 23, 2020 the Company entered into a six month lease for a small satellite office space. As the lease is short term in nature, the Company did not record a right of use asset or liability associated with the lease. Minimum annual rental payments under these operating leases, reconciled to the lease liability included in accrued liabilities and other in our consolidated balance sheets, are as follows (in thousands):

($ in thousands)

    

Future Rental

Year Ending December 31,

Payments

2021

$

99

2022

 

2023

2024

2025 and beyond

$

99

($ in thousands)

    

Future rental

 

Year Ending December 31,

payments

 

2024

$

247

2025

205

2026

2027

 

2028

 

Thereafter

Total lease payments

452

Less: imputed interest

(53)

Lease liability

$

399

Litigation

On July 11,2, 2021, the Company filed a complaint against First Sabrepoint Capital Management, LP, Sabrepoint Capital Partners, LP, Sabrepoint Capital Participation, LP, George Baxter, and Donald Marchiony (collectively, “Sabrepoint”) in the Civil District Courts of Dallas County, Texas seeking relief for their role, as alleged in the complaint, in the previously disclosed 2018 “short and distort” scheme to profit from an artificial decline in our stock price. Certain Sabrepoint defendants had prevailed previously on a purported classmotion to dismiss the case against them in the Rota Fortunae action lawsuit, captioned Kachmar v. Farmland Partners Inc. (the “Kachmar Action”), was filed in the United StatesState District Court for the District of Colorado (where the state case had been removed) solely on personal jurisdiction grounds. On December 17, 2021, the Company's claims against the Company and certain of ourSabrepoint in

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officersTexas were dismissed by a purported Company stockholder. The complaint alleges, among other things, that our disclosure related to the FPI Loan Program was materially falsetrial court, which granted (i) Sabrepoint's motion for summary judgment on collateral estoppel grounds, and misleading in violation of the Securities Exchange Act of 1934, as amended, and Rule 10b-5 promulgated thereunder. On August 17, 2018, a second purported class action, captioned Mariconda v. Farmland Partners Inc. (the “Mariconda Action”) was filed in the United States District Court for the District of Colorado, alleging substantially identical claims as the Kachmar Action. Several purported shareholders moved to consolidate the Kachmar Action and the Mariconda Action and for appointment as Lead Plaintiff.  On November 13, 2018, the plaintiff in the Kachmar action voluntarily dismissed the Kachmar Action.  On December 3, 2018, the court appointed two purported stockholders of the Company, the Turner Insurance Agency, Inc. and Cecilia Turner (the “Turners”), as lead plaintiffs in the Mariconda Action. On March 11, 2019, the court-appointed lead plaintiffs and additional plaintiff Obelisk Capital Management filed an amended complaint in the Turner Action.  On April 15, 2019, the defendants moved to dismiss the amended complaint in the Turner Action. On June 18, 2019, the court denied the defendants’(ii) motion to dismiss pursuant to the amended complaint inTexas Citizens Participation Act (“TCPA”). On March 21, 2022, after the Turner Action. The defendants answeredCompany filed a notice signaling an intent to appeal both orders, the amended complaint on July 2, 2019.Court of Appeals for the Fifth District of Texas (the “Court of Appeals”) entered an order declaring the trial court's TCPA order “VOID because the motion was denied by operation of law….” Accordingly, the Company narrowed its appeal to the trial court's grant of summary judgment. On December 6, 2019, plaintiffs voluntarily dismissed Obelisk Capital Management from the case. In connection with Obelisk Capital Management’s dismissal from the case, defendantsJanuary 26, 2022, Sabrepoint filed a motion for judgmentattorney's fees relating to the defense of that action. The trial court granted the motion for certain fees claimed by Sabrepoint as relating to its pursuit of its TCPA motion, but as noted above, the Court of Appeals subsequently overturned the TCPA order that formed the basis of Sabrepoint’s fee request, mooting the motion and the Court’s order on the pleadingssame. On June 30, 2023, the Court of Appeals granted the Company’s appeal, determining that the Company’s claims against Sabrepoint are not barred, reversing the trial court and remanding the case for further proceedings on December 10, 2019, which automatically stayed discovery in the action pending the court’s determination of the motion.merits. On December 16, 2019, plaintiffsOctober 13, 2023, Sabrepoint filed a motionPetition for class certification, seekingReview with the Texas Supreme Court, requesting the court to havereview the Turners and purported stockholder Don Brokop appointed as class representative. On December 27, 2019, plaintiffs filed a motion for leave to file a second amended complaint to add Brokop as additional plaintiff in placeCourt of Obelisk Capital Management. DefendantsAppeals’ decision. The Company filed a response opposingto the motionSabrepoint Petition for leave to fileReview with the Texas Supreme Court on December 27, 2023, and Sabrepoint filed a second amended complaintreply in support of its petition on January 17, 2020, and filed25, 2024. On February 16, 2024, the Texas Supreme Court requested a motion to adjourn the class certification briefing schedule in light of the discovery stay on January 29, 2020. On December 8, 2020, the court granted the Turners motion to amend to add Brokop as an additional plaintiff and denied the company’s motion for judgment on the pleadings.  Asmerits. The petition is now fully briefed and pending a result,decision from the automatic discovery stay was lifted and the court entered a schedule for proceedings going forward.  The company, Mr. Pittman, and Mr. Fabbri filed an opposition to plaintiffs’ motion for class certification on February 8, 2021.  On February 17, 2021, plaintiffs filed a motion to withdraw the Turners as lead plaintiffs and to substitute Brokop as lead plaintiff.  Discovery remains ongoing. At this time, no class has been certified in the Turner Action and we do not know the amount of damages or other remedies being sought by the plaintiffs.court. The Company can provide no assurances asremains confident that it will ultimately be permitted to the outcome of this litigation or provide an estimate of related expenses at this time.proceed with its claims against Sabrepoint.

On December 18, 2018, a purported stockholder of the Company, Jack Winter, filed a complaint in the Circuit Court for Montgomery County, Maryland (the “Winter Action”), purporting to assert breach of fiduciary duty claims derivatively on the Company’s behalf against the Company’s directors and certain of the Company’s officers.  The Winter Action alleges, among other things, that the Company’s directors and certain of the Company’s officers breached their fiduciary duties to the Company by allowing the Company to make allegedly false and misleading disclosures related to the FPI Loan Program, as alleged in the Turner Action.  On April 26, 2019, Winter voluntarily dismissed his complaint in the Circuit Court for Montgomery County Maryland.  On May 14, 2019, Winter re-filed his complaint in the United States District Court for the District of Colorado.  The Winter Action has been stayed pending further proceedings in the Turner Action.

On November 25, 2019, another purported shareholder, Shawn Luger, filed a complaint derivatively on behalf of the Company and against certain of our officers in the Circuit Court for Baltimore City, Maryland (the “Luger Action”). The Luger Action complaint makes similar claims to those in the Turner and Winter Actions. The parties to the Luger Action stipulated to a stay of the case pending further proceedings in the Turner Action and filed a joint motion to stay on February 7, 2020. On February 14, 2020, another purported shareholder, Brent Hustedde, filed a complaint derivatively on behalf of the Company and against certain of our officers in Maryland state court (the “Hustedde Action”).  The Hustedde Action complaint makes similar claims to those in the Turner, Winter, Luger, and Barber Actions. On June 26, 2020, the parties reached an agreement to lift the stay in the Luger Action. On September 14, 2020, plaintiffs in the Luger and Hustedde Actions moved to consolidate the two Actions.  On September 23, 2020, the Court consolidated the Luger and Hustedde action under the caption In re Farmland Partners Inc. Stockholder Litigation (the “Stockholder Litigation”).  The Luger and Hustedde (the “Derivative Plaintiffs”), the plaintiffs in the Stockholder Litigation, filed a consolidated amended complaint on October 30, 2020. The Company moved to dismiss the complaint in the Stockholder Litigation on December

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15, 2020. The Derivative Plaintiffs filed their opposition to the Company’s motion to dismiss on February 12, 2021.  The Company’s reply brief in further support of its motion to dismiss is due to be filed on March 19, 2021.  By agreement of the parties, the individual defendants’ time to respond to the complaint in the Stockholder Litigation is adjourned until decision on the Company’s motion to dismiss.

On November 26, 2019, another purported shareholder, Anna Barber, filed a complaint derivatively on behalf of the Company and against certain of our officers in the United States District Court for the District of Colorado (the “Barber Action”).  The Barber Action complaint makes similar claims to those in the Turner, Winter, and Luger Actions. The Barber Action has been stayed pending further proceedings in the Turner Action.    

On July 24, 2018, we filed a lawsuit in the District Court, Denver County, Colorado, against “Rota Fortunae” (a pseudonym for Quinton Mathews, the individual behind Rota Fortunae) and numerous co-conspirators (collectively, “Wheel of Fortune”) in response to an article posted on Seeking Alpha that makes numerous allegations about the Company that we believe to be false or materially misleading. We believe that as a consequence of Wheel of Fortune’s internet posting and related postings on social media, the trading price of our common stock declined by approximately 40%. We believe that Wheel of Fortune’s, including Quinton Mathews’s, internet posting was made in connection with a “short and distort” scheme to profit from a decline in our stock price based on false and misleading information. The lawsuit that we filed alleges that Wheel of Fortune, including Quinton Mathews, disseminated material false, misleading and defamatory information about us that has harmed us and our stockholders. The Company does not expect insurance proceeds to cover a substantial portion of the costs related to the lawsuit we filed against Wheel of Fortune. On May 15, 2020, United States District Court for the District of Colorado to which this case was removed issued orders (i) denying Rota Fortunae’s motion to dismiss our claims; and (ii) requiring him to disclose his identity.  On July 28, 2020, the Court granted our motion to amend the complaint to Quinton Mathew’s name as well as the following co-conspirators: QKM, L.L.C., Sabrepoint Capital Management, LP, Donald Marchiony and George Baxter. On February 26, 2021 the Court granted the motion of Sabrepoint Capital Management, LP, Donald Marchiony, and George Baxter to dismiss them on personal jurisdiction grounds. The case is currently in the discovery phase.

Repurchase Options

For certain of the Company’s acquisitions, the seller has retainedretains the option is given to the seller to repurchase the property at a future date for a price, which is calculated based on an appreciation factor over the original purchase price plus the value of improvements on the property, that, at the time of the acquisition, the Company expected would be at or above the property’s fair market value at the exercise date. As of December 31, 2023, the Company had an approximate aggregate net book value of $5.1 million related to assets with unexercised repurchase options, and $15.7 million related to assets with exercised repurchase options. On September 4, 2020, the seller inof one of such acquisitions the Company’s tenantsproperty exercised its right to repurchase approximately 2,860 acres in South Carolina. TheCarolina, for which the Company has received a non-refundable initial paymentpayments totaling $3.5 million as of $2.9 million upon exercise.December 31, 2023. The Company is scheduled to receive a series of non-refundable payments until the closing date, which is currently scheduled to close take place on or before January 15, 2025.

Employee Retirement Plan

Effective February 1, 2022, the Company amended the Murray Wise Associates 401(k) Profit Sharing Plan and Trust to make it available to all eligible employees of the Company under revised Farmland Partners Operating Partnership, LP 401(k) Plan (the “FPI 401(k) Plan”). The FPI 401(k) Plan is a defined contribution plan for substantially all employees. The Company has elected a “safe harbor” plan in which the Company plans to make contributions which are determined and authorized by the Board of Directors each plan year. As is customary, the Company retains the right to amend the FPI 401(k) Plan at its discretion. The Company made safe harbor contributions of $0.1 million and $0.2 million, respectively, during the years ended December 31, 2020, the Company has an approximate aggregate net book value of $10.8 million related to assets with unexercised repurchase options,2023 and $15.9 million related to assets with exercised repurchase options.2022.

Note 9—Stockholders’ Equity and Non-controlling Interests

Non-controlling Interest in Operating Partnership

The CompanyFPI consolidates itsthe Operating Partnership, a majority-owned partnership.Partnership. As of December 31, 2020, the Company2023 and 2022, FPI owned 94.9%97.6% and 97.8% of the outstanding interests, respectively, in the Operating Partnership, and the remaining 2.4% and 2.2% interests, respectively, are held in the form of Common units and the remaining 5.1% of the Common units are includedcomprise non-controlling interests in non-controlling interest inthe Operating Partnership on the consolidated balance sheets. The non-controlling interests in the Operating Partnership consist of both the Common units and the Series A preferred units held by third parties.

Common Units in Operating Partnership, OP Units

On or after 12 months of becoming a holder of Common units, unless the terms of an agreement with such Common unitholder dictate otherwise, each limited partner, other than the Company, has the right, subject to the terms and conditions set forth in the Second Amended and Restated Agreement of Limited Partnership of the Operating Partnership, as amended (the “Partnership Agreement”), to tender for redemption all or a portion of such Common units in exchange for cash, or in

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Notes to Consolidated Financial Statements (Continued)

the Company’s sole discretion, for shares of the Company’s common stock on a 1-for-oneone-for-one basis. If cash is paid in satisfaction of a redemption request, the amount will be equal to the number of tendered units multiplied by the fair market value per share of the Company’s common stock on the date of the redemption notice (determined in accordance with, and subject to adjustment under, the terms of the Partnership Agreement). Any redemption request must be satisfied by the Company on or before the close of business on the tenth business day after the Company receives a

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Notes to Consolidated Financial Statements (continued)

notice of redemption. During the yearsyear ended December 31, 2020 and 2019,2023, the Company redeemed 34,000 Common units in exchange for cash of approximately $0.4 million. During the year ended December 31, 2022, the Company issued 265,000 and 2,678,187, respectively, of120,000 shares of common stock upon the redemption of 265,000 and 2,678,187, respectively,120,000 Common units that had been tendered for redemption. There were 1.6approximately 1.2 million and 1.91.2 million outstanding Common units eligible to be tendered for redemption as of December 31, 20202023 and December 31, 2019,2022, respectively.

If the Company gives the limited partners notice of its intention to make an extraordinary distribution of cash or property to its stockholders or effect a merger, a sale of all or substantially all of its assets or any other similar extraordinary transaction, each limited partner may exercise its right to tender its Common units for redemption, regardless of the length of time such limited partner has held its Common units.

Regardless of the rights described above, the Operating Partnership will not have an obligation to issue cash to a unitholder upon a redemption request if the Company elects to redeem the Common units for shares of common stock. When a Common unit is redeemed, non-controlling interest in the Operating Partnership is reduced, and controlling interest stockholders’ equity is increased.

The Operating Partnership intends to continue to make distributions on each Common unit in the same amount as those paid on each share of the Company’sFPI’s common stock, with the distributions on the Common units held by the CompanyFPI being utilized to make distributionspay dividends to the Company’sFPI’s common stockholders.

Pursuant to the consolidation accounting standard with respect to the accounting and reporting for non-controlling interest changes and changes in ownership interest of a subsidiary, changes in parent’s ownership interest when the parent retains controlling interest in the subsidiary should be accounted for as equity transactions. The carrying amount of the non-controlling interest shall be adjusted to reflect the change in its ownership interest in the subsidiary, with the offset to equity attributable to the parent. As a result of equity transactions including and subsequent to the IPO, changesChanges in the ownership percentages between the Company’s stockholders’ equity and non-controlling interest in the Operating Partnership occurred during each of the two years ended December 31, 2020.  To reflect these changes, adjustments were maderesulted in a decrease and an increase to increase / (decrease) the non-controlling interest in the Operating Partnership by $(0.3)less than ($0.1) million and $0.1$0.8 million during the years ended December 31, 20202023 and 20192022, respectively, with the corresponding offsets to additional paid-in capital.

Redeemable Non-controllingNon-Controlling Interests in Operating Partnership, Series A preferred unitsPreferred Units

On March 2, 2016, the sole general partner of the Operating Partnership entered into Amendment No. 1 (the “Amendment”) to the Partnership Agreement in order to provide for the issuance, and the designation of the terms and conditions, of the Series A preferred units. UnderPursuant to the Amendment, among other things, each Series A preferred unit has a $1,000 liquidation preference and is entitled to receive cumulative preferential cash distributions at a rate of 3.00% per annum of the $1,000 liquidation preference, which is payable annually in arrears on January 15 of each year or the next succeeding business day. The cash distributions are accrued ratably over the year and credited to redeemable non-controlling interest in operating partnership, Series Athe Operating Partnership, preferred units on the balance sheet with the offset chargedrecorded to retained earnings. On March 2, 2016, 0.1 million117,000 Series A preferred units were issued as partial consideration in the Forsythe farm acquisition (See “Note 5—Real Estate”).of a portfolio of Illinois farms. Upon any voluntary or involuntary liquidation or dissolution, the Series A preferred units are entitled to a priority distribution ahead of Common units in an amount equal to the liquidation preference plus an amount equal to all distributions accumulated and unpaid to the date of such cash distribution. TotalOn May 19, 2022, the Company redeemed 5,000 Series A preferred units for $5.0 million plus accrued distributions for an aggregate of $5.1 million in cash. On September 1, 2022, the Company redeemed an additional 5,000 Series A preferred units for $5.0 million plus accrued distributions for an aggregate of $5.1 million in cash. On May 31, 2023, the Company redeemed 8,000 Series A preferred units for $8.0 million plus accrued distributions for an aggregate of $8.1 million in cash. As of December 31, 2023, 99,000 Series A preferred units were outstanding. The total liquidation value of such preferred units as of December 31, 20202023 and December 31, 20192022 was $120.5$102.0 million and $120.5$110.2 million, respectively, including accrued distributions.

 

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Notes to Consolidated Financial Statements (Continued)

On or after February 10, 2026 (the “Conversion Right Date”), holders of the Series A preferred units have the right to convert each Series A preferred unit into a number of Common units equal to (i) the $1,000 liquidation preference plus all accrued and unpaid distributions, divided by (ii) the volume-weighted average price per share of the Company’s common stock for the 20 trading days immediately preceding the applicable conversion date. All Common units received upon conversion may be immediately tendered for redemption for cash or, at the Company’s option, for shares of common stock on a 1-for-oneone-for-one basis, subject to the terms and conditions set forth in the Partnership Agreement. Prior to the Conversion Right Date, the Series A preferred units may not be tendered for redemption by the Holder.

 

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Notes to Consolidated Financial Statements (continued)

On or after February 10, 2021, the fifth anniversary of the closing of the Forsythe acquisition, but prior to the Conversion Right Date, the Operating Partnership has the right to redeem some or all of the Series A preferred units, at any time and from time to time, for cash in an amount per unit equal to the $1,000 liquidation preference plus all accrued and unpaid distributions.

In the event of a Termination Transaction (as defined in the Partnership Agreement) prior to conversion, holders of the Series A preferred units generally have the right to receive the same consideration as holders of Common units and common stock, on an as-converted basis.

 

Holders of the Series A preferred units have no voting rights except with respect to (i) the issuance of partnership units of the Operating Partnership senior to the Series A preferred units as to the right to receive distributions and upon liquidation, dissolution or winding up of the Operating Partnership, (ii) the issuance of additional Series A preferred units and (iii) amendments to the Partnership Agreement that materially and adversely affect the rights or benefits of the holders of the Series A preferred units.

The Series A preferred units are accounted for as mezzanine equity on the consolidated balance sheet as the units are convertible and redeemable for shares at a determinable price and date at the option of the holder upon the occurrence of an event not solely within the control of the Company.

The following table summarizes the changes in our redeemable non-controlling interest in the Operating Partnership for the years ended December 31, 20202023 and 2019:2022:

Preferred

(in thousands)

    

Redeemable OP Units

    

Redeemable Non-controlling Interests

Balance at December 31, 2018

117

$

120,510

Distribution paid to non-controlling interest

(3,510)

Accrued distributions to non-controlling interest

3,510

Balance at December 31, 2019

117

$

120,510

Balance at December 31, 2019

117

$

120,510

Distribution paid to non-controlling interest

(3,510)

Accrued distributions to non-controlling interest

3,510

Balance at December 31, 2020

117

$

120,510

Series B Participating Preferred Stock

On August 17, 2017, the Company and the Operating Partnership entered into an underwriting agreement with Raymond James & Associates, Inc. and Jefferies LLC, as representatives of the underwriters, pursuant to which the Company sold 6,037,500 shares of its newly designated Series B Participating Preferred Stock, at a public offering price of $25.00 per share, which is the Initial Liquidation Preference (as defined below) of the Series B Participating Preferred Stock.

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Shares of Series B Participating Preferred Stock, which represent equity interests in the Company, generally have no voting rights and rank senior to the Company’s common stock with respect to dividend rights and rights upon liquidation. Each preferred share of Series B Participating Preferred Stock is entitled to receive cumulative preferential cash dividends at a rate of 6.00% per annum of the $25 liquidation preference, which is payable quarterly in arrears on the last day of each March, June, September and December (the “Initial Liquidation Preference”). Upon liquidation, before any payment or distribution of the assets of the Company is made to or set apart for the holders of equity securities ranking junior to the Series B Participating Preferred Stock, the holders of the Series B Participating Preferred Stock will be entitled to receive the sum of:

(i)the Initial Liquidation Preference,
(ii)adjusted by an amount equal to 50% of the cumulative change in the estimated value of farmland in the states in which the Company owned  farmland as of June 30, 2017 (measured by reference to a publicly available report released annually by the National Agricultural Statistics Board, the Agricultural Statistics Board and the U.S. Department of Agriculture) (the “FVA Adjustment”), and
(iii)all accrued and unpaid dividends, subject to a 9.0% cap on total return (the “Final Liquidation Preference”).

After September 30, 2021, but prior to September 30, 2024, the Company at its option, may redeem all, but not less than all, of the then-outstanding shares of Series B Participating Preferred Stock at any time, for cash or for shares of common stock at a price equal to the Final Liquidation Preference plus an amount equal to the product of:

(i)the Final Liquidation Preference, and
(ii)the average change in land values in states in which the Company owned  farmland as of June 30, 2017 over the immediately preceding four years and multiplied by a constant percentage of 50% and prorated for the number of days between the most recent release of the publicly available land value report used to calculate the FVA Adjustment  (if such amount is positive) (the “Premium Amount”).

At any time on or after September 30, 2024, the Company, at its option, may redeem or convert to shares of common stock all, but not less than all, of the then-outstanding shares of Series B Participating Preferred Stock at the redemption price per share equal to:

(i)the Initial Liquidation Preference, plus
(ii)the FVA Amount, plus
(iii)any accrued and unpaid dividends.

The total rate of return on shares of the Series B Participating Preferred Stock is subject to a cap such that the total rate of return, when considering the Initial Liquidation Preference, the FVA Adjustment and the Premium Amount plus accrued and unpaid dividends, will not exceed 9.0%. Based on the data released by the USDA in August 2020 in their land values 2020 summary, the FVA Amount as of 2020 was determined to be $0.80 per share of Series B Participating Preferred Stock.

In connection with the issuance of the Series B Participating Preferred Stock, the sole general partner of the Operating Partnership entered into Amendment No. 2  to the Partnership Agreement in order to provide for the issuance, and the designation of the terms and conditions, of newly classified 6.00% Series B participating preferred units of limited partnership interest in the Operating Partnership (“Series B participating preferred units”), the economic terms of which are identical to those of the Series B Participating Preferred Stock. The Company contributed the net proceeds from the offering of the Series B Participating Preferred Stock to the Operating Partnership in exchange for 6,037,500 Series B participating preferred units.

The shares of Series B Participating Preferred Stock are accounted for as mezzanine equity on the consolidated balance sheet as the Series B Participating Preferred Stock is convertible and redeemable for common shares at a

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determinable price and date at the option of the Company but upon the occurrence of an event not solely within the control of the Company.

During the year ended December 31, 2020 and 2019, the balance recorded in mezzanine equity relating to the Series B Participating Preferred Stock was $139.8 million and $142.9 million, respectively. During the year ended December 31, 2020, and December 31, 2019 the Company declared and paid dividends relating to the Series B Participating Preferred Stock of $8.8 million and $9.0 million, respectively.

Series A Preferred Units

Redeemable

Redeemable

Preferred

non-controlling

(in thousands)

    

units

    

interests

Balance at December 31, 2021

117

$

120,510

Distribution paid to non-controlling interest

(3,510)

Accrued distributions to non-controlling interest

3,210

Redemption of Series A preferred units

(10)

(10,000)

Balance at December 31, 2022

107

$

110,210

Balance at December 31, 2022

107

$

110,210

Distribution paid to non-controlling interest

(3,210)

Accrued distributions to non-controlling interest

2,970

Redemption of Series A preferred units

(8)

(8,000)

Balance at December 31, 2023

99

$

101,970

Distributions

The Company’s Board of Directors declared and and the Company paid the following distributions to common stockholders and holders of Common units for the years ended December 31, 20202023 and 2019:2022:

Fiscal Year

    

Declaration Date

    

Record Date

    

Payment Date

    

Distributions
per Common
Share/OP unit

    

Declaration Date

    

Record Date

    

Payment Date

    

Distributions
per Common
Share/OP unit

2020

March 11, 2020

April 1, 2020

April 15, 2020

$

0.0500

May 6, 2020

July 1, 2020

July 15, 2020

$

0.0500

August 4, 2020

October 1, 2020

October 15, 2020

$

0.0500

November 3, 2020

January 1, 2021

January 15, 2021

0.0500

$

0.2000

2019

2023

October 24, 2022

January 2, 2023

January 17, 2023

$

0.0600

February 7, 2019

April 1, 2019

April 15, 2019

0.0500

February 21, 2023

April 3, 2023

April 17, 2023

$

0.0600

May 8, 2019

July 1, 2019

July 15, 2019

0.0500

May 3, 2023

July 3, 2023

July 17, 2023

$

0.0600

August 6, 2019

October 1, 2019

October 15, 2019

$

0.0500

July 25, 2023

October 2, 2023

October 16, 2023

$

0.0600

November 11, 2019

January 1, 2020

January 15, 2020

0.0500

$

0.2400

$

0.2000

2022

October 26, 2021

January 3, 2022

January 18, 2022

$

0.0500

February 22, 2022

April 1, 2022

April 15, 2022

$

0.0500

May 2, 2022

July 1, 2022

July 15, 2022

$

0.0600

July 26, 2022

October 1, 2022

October 17, 2022

$

0.0600

$

0.2200

Additionally, in connection with the 3.00% cumulative preferential distribution on the Series A preferred units, the Company accrued $3.5 million in distributions payable as of December 31, 2020 which was paid on2023, the Company accrued $13.3 million in dividends payable to common stockholders and holders of Common units (paid in January 15, 2021.  The distributions are payable annually in arrears on January 15 or the next business day,2024), including $10.3 million as a one-time special dividend of each year.$0.21 per share related to

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Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (continued)

asset appreciation. In general, common stock cash dividends declared by the Company will be considered ordinary income to stockholders for income tax purposes. From time to time, a portion of the Company’s dividends may be characterized as qualified dividends, capital gains or return of capital.  DuringFor income tax purposes, 2023 common stock dividends were $0.41 per share (which includes a portion of the years ended$0.21 per share one-time special dividend mentioned above) all of which are considered capital gains as defined by I.R.C. Section 857(b)(3).

In connection with the 3.00% cumulative preferential distribution on the Series A preferred units, the Company had accrued $3.0 million in distributions payable as of December 31, 2020 and 2019, 47% and 2%, respectively,2023. The distributions are payable annually in arrears on January 15 of the income distributed in the form of dividends was characterized as ordinary income.each year.

Share Repurchase Program

On March 15, 2017, the Company’s boardBoard of directorsDirectors approved a program to repurchase up to $25$25.0 million in shares of the Company’s common stock. In November 2017, the board of directors approved repurchases of the Company’s Series B Participating Preferred Stock from time to time under the share repurchase program. Subsequently onOn August 1, 2018, the boardBoard of directorsDirectors increased the authority under the share repurchase program by an aggregate of $30$30.0 million. On November 7, 2019, the boardBoard of directorsDirectors increased the authority under the program by an additional $50$50.0 million. On May 3, 2023, the Company’s Board of Directors approved a $75.0 million increase resulting in total availability under the share repurchase program of approximately $88.0 million as of such date. On November 1, 2023, the Company’s Board of Directors approved a $40.0 million increase in the total authorization available under the program, increasing the total availability under the share repurchase program to approximately $85.0 million as of such date. Repurchases under this program may be made from time to time, in amounts and prices as the Company deems appropriate. Repurchases may be made in open market or privately negotiated transactions in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended, subject to market conditions, applicable legal requirements, trading restrictions under the Company’s insider trading policy and other relevant factors. This share repurchase program does not obligate the Company to acquire any particular amount of common stock or Series B Preferred Stock and it may be modified or suspended at any time at the Company’s discretion. The Company funds repurchases under the program using cash on its balance sheet.

During 2020,the year ended December 31, 2023, the Company had repurchased 1,034,167 shares at an average price per share of $6.59 for a total cost of approximately $6.8 million and 140,1896,551,087 shares of its Series B preferredcommon stock for $3.1 million at ana weighted average price of $22.08$11.00 per share. As of December 31, 2020,2023, the Company had approximately $41.1$83.3 million in shares

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Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)

that it can repurchasecapacity remaining under the stock repurchase plan. In addition, the Company redeemed 34,000 Common units in exchange for cash of approximately $0.4 million.

Equity Incentive Plan

On May 3, 2017,7, 2021, the Company’s stockholders approved the SecondThird Amended and Restated 2014 Equity Incentive Plan (as amended and restated, the “Plan”), which increased the aggregate number of shares of the Company’s common stock reserved for issuance under the Plan to approximately 1.31.9 million shares. As of December 31, 2020,2023, there were 0.20.4 million of shares available for future grants under the Plan.

The Company may issue equity-based awards to officers, non-employee directors, employees, independent contractors and other eligible persons under the Plan. The Plan provides for the grant of stock options, share awards (including restricted stock and restricted stock units), stock appreciation rights, dividend equivalent rights, performance awards, annual incentive cash awards and other equity basedequity-based awards, including LTIP units, which are convertible on a one-for-one basis into Common units. The Plan provides for a maximum of 1.3 million shares of common stock for issuance. The terms of each grant are determined by the Compensation Committeecompensation committee of the Board of Directors.

During 2020From time to time, the Company granted 0.1 millionmay award restricted shares of its common stock under the Plan, as compensation to officers, employees, non-employee directors and non-employee consultants. The shares of restricted stock vest generally over a period of time as determined by the compensation committee of the Company’s Board of Directors at the date of grant. The Company recognizes compensation expense for awards issued to officers, employees and non-employee directors for restricted shares of common stock with an aggregate grant dateon a straight-line basis over the vesting period based upon the fair market value of $0.9 million,the shares on the date of issuance, adjusted for forfeitures. The Company recognizes compensation expense for awards issued to employeesnon-employee consultants in the same period and directors.  The restricted shares vest ratably over a one, three or five-year vesting period, subject to continued service.

During 2019in the same manner as if the Company granted 0.2 million restricted shares of common stock, with an aggregate grant date fair value of $1.4 million, to employees and directors.  The restricted shares vest ratably over a one, three or five-year vesting period, subject to continued service.

During 2020, 0 restricted shares of common stock were forfeited by independent directors and employees.  

During 2019, 25,423 restricted shares of common stock were forfeited by independent directors and employees.  The Company had recorded $28,046 in stock based compensation and paid $3,688 in dividends with respect to such restricted shares. In connection withcash for the forfeiture of restricted shares, the Company reversed $5,249 in previously recorded compensation expense, net of the dividends paid.            

A summary of the non-vested restricted shares as of December 31, 2020 and 2019 is as follows:

    

    

Weighted

Number of

Average Grant

(shares in thousands)

    

Shares

    

Date Fair Value

Unvested at January 1, 2019

 

299

$

11.16

Granted

 

226

$

6.07

Vested

 

(155)

$

9.63

Forfeited

 

(25)

$

6.32

Unvested at December 31, 2019

 

345

$

9.49

Granted

 

139

$

6.23

Vested

 

(168)

$

8.24

Forfeited

 

$

Unvested at December 31, 2020

 

316

$

6.46

For the years ended December 31, 2020 and 2019, the Company recognized $1.1 million and $1.4 million, respectively, of stock-based compensation expense related to these restricted stock awards. As of December 31, 2020 and 2019, there was $1.2 million and $1.4 million, respectively, of total unrecognized compensation costs related to non-vested stock awards which are expected to be recognized over weighted-average periods of 1.5 years.underlying services.

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Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)(continued)

Earnings per Share

The computation of basic and diluted earnings (loss) per share is as follows:

For the year ended December 31,

($ in thousands except per share data)

    

2020

    

2019

    

Numerator:

Net income (loss) attributable to Farmland Partners Inc.

$

7,119

$

13,886

Less: Nonforfeitable distributions allocated to unvested restricted shares

 

(64)

 

(77)

Less: Distributions on redeemable non-controlling interersts in operating partnership, Common units

 

 

Less: Distributions on redeemable non-controlling interests in operating partnership, Series A Preferred units

(3,510)

(3,510)

Less: Dividends on Series B Participating Preferred Stock

(8,824)

(8,975)

Net income (loss) attributable to common stockholders

$

(5,279)

$

1,324

Denominator:

Weighted-average number of common shares - basic

 

29,376

 

30,169

Conversion of Series A preferred units(1)

Conversion of Series B participating preferred stock

Unvested restricted shares(1)

 

 

Weighted-average number of common shares - diluted

 

29,376

 

30,169

Income (loss) per share attributable to common stockholders - basic

$

(0.18)

$

0.04

Income (loss) per share attributable to common stockholders - diluted

$

(0.18)

$

0.04

(1)Anti-dilutive for the years ended December 31, 2020 and 2019.

The limited partners’ outstanding Common units (which may be redeemed for shares of common stock) and Excess Units have been excluded from the diluted earnings per share calculation as there would be no effect on the amounts since the limited partners’ share of income would also be added back to net income. Any anti-dilutive shares have been excluded from the diluted earnings per share calculation. Unvested share-based payment awards that contain non-forfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and shall be included in the computation of earnings per share pursuant to the two-class method. Accordingly, distributed and undistributed earnings attributable to unvested restricted shares (participating securities) have been excluded, as applicable, from net income or loss attributable to common stockholders utilized in the basic and diluted earnings per share calculations. Net income or loss figures are presented net of non-controlling interests in the earnings per share calculations. The weighted average number of Common units held by the non-controlling interest was 1.8 million and 2.4 million for the years ended December 31, 2020 and 2019, respectively. The weighted average number of Excess Units held by the non-controlling interest was 0.0 million for each of the years ended December 31, 2020 and 2019.

For the years ended December 31, 2020 and 2019, diluted weighted average common shares do not include the impact of 0.3 million of unvested compensation-related shares because the effect of these items on diluted earnings per share would be anti-dilutive.

The following equity awards and units are outstanding as of December 31, 2020 and 2019, respectively.

(in thousands)

    

December 31, 2020

 

December 31, 2019

 

Common Shares

30,255

29,607

OP Units

1,639

1,904

Unvested Restricted Stock Awards

316

345

32,210

31,856

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Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)

Note 10—Quarterly Financial Information (unaudited)A summary of the non-vested restricted shares as of December 31, 2023 and 2022 is as follows:

Weighted

Number of

average grant

(shares in thousands)

    

shares

    

date fair value

Unvested at December 31, 2021

 

297

$

8.87

Granted

 

150

11.78

Vested

 

(177)

8.22

Forfeited

 

(10)

11.24

Unvested at December 31, 2022

 

260

$

10.88

Unvested at December 31, 2022

 

260

$

10.88

Granted

 

226

10.92

Vested

 

(138)

10.28

Forfeited

 

(1)

12.26

Unvested at December 31, 2023

 

347

$

11.15

The following table reflects the quarterly resultsCompany recognized stock-based compensation and incentive expense related to restricted stock awards of operations for$1.9 million and $2.0 million, for the years ended December 31, 20202023 and 2019.  2022, respectively. The Company recognized $0.0 million and $0.4 million during the years ended December 31, 2023 and 2022, respectively, related to stock-based incentive expense in connection with the November 2021 acquisition of Murray Wise Associates, LLC, which are included in the amounts above. As of December 31, 2023 and 2022, there were $2.3 million and $1.7 million, respectively, of total unrecognized compensation costs related to nonvested stock awards, which are expected to be recognized over a weighted-average period of 1.7 years.

Quarter Ended

($ in thousands except per share data)

March 31, 2020

June 30, 2020

September 30, 2020

December 31, 2020

Operating revenues

    

$

11,650

10,517

10,604

17,917

Operating expenses

6,361

6,828

6,955

8,216

Other expenses

4,870

3,517

3,088

3,324

Net (loss) income before income tax

419

172

561

6,377

Income tax expense

Net (loss) income

$

419

$

172

$

561

$

6,377

Net (loss) available to common stockholders of Farmland Partners Inc.

$

(2,737)

$

(2,942)

$

(2,553)

$

2,955

Basic net (loss) per share available to common stockholders(1)

$

(0.09)

$

(0.10)

$

(0.09)

$

0.10

Diluted net (loss) per share available to common stockholders(1)

$

(0.09)

$

(0.10)

$

(0.09)

$

0.06

Basic weighted average common shares outstanding

29,545

29,433

29,206

29,331

Diluted weighted average common shares outstanding

29,545

29,433

29,206

46,461

(1)The basic and diluted net (loss) income for the quarters do not equal full year results due to issuance of common stock throughout the year and rounding.

At-the-Market Offering Program (the “ATM Program”)

Quarter Ended

($ in thousands)

    

March 31, 2019

June 30, 2019

September 30, 2019

December 31, 2019

Operating revenues

$

10,889

10,948

9,848

21,879

Operating expenses

6,366

6,994

6,622

7,245

Other expenses

4,514

(2,571)

4,689

4,855

Net (loss) income before income tax

9

6,525

(1,463)

9,779

State income tax expense

Net (loss) income

$

9

$

6,525

$

(1,463)

$

9,779

Net (loss) income available to common stockholders of Farmland Partners Inc.

$

(3,140)

$

2,906

$

(4,499)

$

6,057

On May 6, 2022, the Company entered into equity distribution agreements under which the Company may issue and sell from time to time, through sales agents, shares of its common stock having an aggregate gross sales price of up to $100.0 million (the ATM Program”). During the year ended December 31, 2023, the Company sold no shares under the ATM Program and had a remaining capacity of $50.5 million in shares of common stock available for issuance.

Note 11—Subsequent EventsEarnings (Loss) per Share

We have evaluated subsequent eventsThe computation of basic and transactions for potential recognition or disclosure in the financial statements through the day the financial statements were issued.diluted earnings (loss) per share is as follows:

For the years ended

December 31,

(in thousands, except per share amounts)

    

2023

    

2022

Numerator:

Net income attributable to Farmland Partners Inc.

$

30,913

$

11,674

Less: Nonforfeitable distributions allocated to unvested restricted shares

 

(157)

 

(63)

Less: Distributions on redeemable non-controlling interests in Operating Partnership, preferred

(2,970)

(3,210)

Net income attributable to common stockholders

$

27,786

$

8,401

Denominator:

Weighted-average number of common shares - basic

 

50,243

 

50,953

Unvested restricted shares (1)

Redeemable non-controlling interest (2)

 

8,049

 

Weighted-average number of common shares - diluted

 

58,292

 

50,953

Income per share attributable to common stockholders - basic

$

0.55

$

0.16

Income per share attributable to common stockholders - diluted

$

0.53

$

0.16

1)Anti-dilutive for the years ended December 31, 2023 and 2022.
2)Dilutive for the year ended December 31, 2023 and anti-dilutive for the year ended December 31, 2022.

Numerator:

Dividends

On February 11, 2021Unvested shares of the Company’s Board of Directors declared a cash dividend of $0.05 per share ofrestricted common stock and Common units payable on April 15, 2021 to stockholders and unitholdersare considered participating securities, which requires the use of record as of April 1, 2021.

On February 11, 2021 the Company’s Board of Directors declared a quarterly cash dividend of $0.375 per share of 6.00% Series B Participating Preferred Stock payable on March 31, 2021 to stockholders of record as of March 15, 2021.

Opportunity Zone Agreement

On January 20, 2021, the Company entered into an agreement with Promised Land Opportunity Zone Farms I, LLC (the “OZ Fund”) to sell, throughout the year as exercised by the buyer by stipulated dates, 12 farms located in opportunity zones as designated by the Tax Cuts and Jobs Act of 2017, and to provide farm management services on the farmstwo-class method for the Promised Land Opportunity Zone Farms in exchange for management fees going forward.

Real Estate Acquisition

On February 8, 2021, the Company completed 1 farm acquisition in the Corn Belt region, consistingcomputation of aggregate consideration of $1.4 million.basic and diluted earnings per share. Unvested share-based payment awards that contain non-

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Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)(continued)

Real Estate Dispositionsforfeitable rights to dividends or dividend equivalents (whether paid or unpaid) are participating securities and shall be included in the computation of earnings per share pursuant to the two-class method. Accordingly, distributed and undistributed earnings attributable to unvested restricted shares (participating securities) have been subtracted, as applicable, from net income or loss attributable to common stockholders utilized in the basic and diluted earnings per share calculations.

On January 29, 2021, the Company completed 1 partial disposition in the Southeast region, consisting of aggregate consideration of $0.8 million and a recorded gain on sale of $0.1 million.Denominator:

On March 5, 2021,Any anti-dilutive shares have been excluded from the Company completed the sale of 9 farms to the OZ Fund, consisting of aggregate consideration of $18.3 million and recorded a gain on sale of $1.8 million. The Company received cash proceeds of $8.3 million and a convertible note of $2.0 million.diluted earnings per share calculation.

On March 10, 2021, the Company completed 1 dispositionThe outstanding Series A preferred units are non-participating securities and thus are included in the Delta and South region, consistingcomputation of aggregate consideration of $4.8 million and a recorded gaindiluted earnings per share on sale of $0.5 million.an as-if converted basis if they are dilutive. For the year ended December 31, 2023, these shares were included in the diluted earnings per share calculation. For the year ended December 31, 2022, these shares were not included in the diluted earnings per share calculation as they would be anti-dilutive.

On March 16, 2021,For the Company completed 1 disposition inyears ended December 31, 2023 and 2022, diluted weighted average common shares do not include the Southeast region, consistingimpact of aggregate consideration of $3.50.3 million and a recorded gain on sale of $0.5 million.unvested compensation-related shares, for each period, as they would have been anti-dilutive.

The limited partners’ outstanding Common Unit Redemptionunits, or the non-controlling interests, (which may be redeemed for shares of common stock) have not been included in the diluted earnings per share calculation as there would be no effect on the amounts since the limited partners’ share of income would also be added back to net income, therefore increasing both net income and shares. The weighted average number of Common units held by the non-controlling interest was 1.2 million and 1.3 million for the years ended December 31, 2023 and 2022, respectively.

On January 8, 2021Outstanding Equity Awards and January 25, 2021, the Company issued 64,995 and 93,710 shares of common stock in exchange for 64,995 and 93,710 Common units, respectively, that had been tendered for redemption. See “Note 9—Stockholders’ Equity and Non-Controlling Interests—Non-Controlling Interests in Operating Partnership”.Units

Debt Maturity ExtensionThe following equity awards and units were outstanding as of December 31, 2023 and 2022, respectively.

    

December 31, 2023

 

December 31, 2022

Shares

47,656

54,058

Common Units

1,203

1,237

Unvested Restricted Stock Awards

347

260

49,206

55,555

On January 29, 2021, the Company entered into an amendment to extend the maturity dates of its 5 Rutlege Promissory Notes from January 1, 2022 to April 1, 2022.

Note 12—10—Hedge Accounting

Cash Flow Hedging Strategy

The Company manages economic risks, including interest rate, liquidity, and credit risk, by managing the amount, sources, duration and interest rate exposure of its funding.financing sources. The Company may also use interest rate derivative financial instruments, namelyprimarily interest rate swaps. As of December 31, 2020,2023, the Company was a party to one interest rate swap, designated as a hedging instrument, to add stability to interest expense and to manage its exposure to adverse interest rate movements.

For derivative instruments that are designated and qualify as a cash flow hedge (i.e., hedging the exposure to variability in expected future cash flows that is attributable to a particular risk), the entire change in the fair value of the Company’s designated cash flow hedges is recorded to accumulated other comprehensive income, a component of shareholders’stockholders’ equity in the Company’s consolidated balance sheets.

On March 26, 2020, the Company terminated its existing swap agreement and entered into a new interest rate swap agreement to obtain a more favorable interest rate and to manage intrestinterest rate risk exposure, which iswas effective April 1, 2020. An interest rate swap agreement utilized by the Company effectively modifiesmodified the Company’s exposure to interest rate risk by converting the Company’s floating-rate debt to a fixed rate basis for the next six years on 50% of the currently outstanding amount to Rabobank at the time of the agreement, thus reducing the impact of interest rate changes on future interest expense. This agreement involves the receipt of floating rate amounts in exchange for fixed rate interest payments over the life of the agreement without an exchange of the underlying principal amount. The fair value of the de-designated swap was $2.6 million on the termination date. The Company is amortizingamortized the de-designated swap over the original term utilizing a forward curve analysis of determining monthly amortization out of Other Comprehensive Income through the

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Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (Continued)(continued)

forward curve analysis of determining monthly amortization.original termination date (March 1, 2023). Amortization for the yearyears ended December 31, 2020, is $0.8 million.2023 and 2022 was $0.2 million and $0.6 million, respectively. The Company’s $2.6 million termination fee was rolled into the new swap and will be paid overthrough March 1, 2026. Termination fees paid during the next six years. The amount of frozen Accumulated Other Comprehensive Income on the de-designated old swap is being amortized out of Other Comprehensive Income through the original termination date (March 1, 2023).years ended December 31, 2023 and 2022 were $0.4 million, for each year.

The Company determines the hedge effectiveness of its interest rate swaps at inception by applying a quantitative evaluation of effectiveness using regression analysis. On an ongoing basis the Company applies an initial qualitative assessementassessment of on-going effectiveness and reviews hedge effectiveness through assessing the hedge relationship by comparing the current terms of the swap and the associated debt to ensure they continue to coincide through the continued ability of the Counterparty to the swap to honor its obligations under the swap contract. If theThe qualitative assessment indicatesmay indicate that the hedge relationship is not highly effective, the Company performswould then perform a quantitative evaluation using regression analysis. The Company concluded the hedge was highly effective at inception and remainsremained highly effective as of December 31, 2020.2023.

As of December 31, 2020,2023, the total notional amount of the Company’s receive-variable/pay-fixed interest rate swap was $33.2 million.

The fair value of the Company’s derivative instrument on a recurring basis is set out below:

($ in thousands)

Instrument

Balance sheet location

Fair Value

    

Balance sheet location

    

Level 2 Fair Value

Interest rate swap

Derivative liability

$

2,899

Derivative asset

$

1,707

The effect of derivative instruments on the consolidated statements of operations for the periodyears ended December 31, 20202023 and 2022 is set out below:


Cash flow hedging relationships

Location of Gain (Loss) reclassified from
Accumulated OCI
into income

Interest rate contracts

Interest expense

TheFor the years ended December 31, 2023 and 2022, the amount of noncash loss recognized in net income for the years ended December 31, 2020 and 2019 was $0.2$1.7 million and $0.1$2.1 million, respectively. The net change recognized in net income associated with current period hedging transactions was $(0.7)($0.8) million and ($0.8)$3.0 million for the years ended December 31, 20202023 and 2019,2022, respectively. The amortization of frozen Accumulated Other Comprehensive Income was $0.8$0.2 million and $0.6 million for the yearyears ended December 31, 2020.2023 and 2022, respectively.

The fair values of the Company’s interest rate swap agreements are determined using the market standard methodology of netting the discounted future fixed cash payments and the discounted expected variable cash receipts, which is considered a Level 2 measurement under the fair value hierarchy. Level 2 is defined as inputs other than quoted prices in active markets that are either directly or indirectly observable. There were no transfers between Levels 1, 2 or 3 during the year ended December 31, 2023. The variable cash receipts are based on an expectation of future interest rates (forward curves) derived from observable market interest rate curvescurves.

The following table outlines the movements in the other comprehensive income account as atof December 31, 20202023 and December 31, 2019:2022:

($ in thousands)

December 31, 2020

December 31, 2019

Beginning accumulated derivative instrument gain or loss

$

(1,644)

$

(865)

Net change associated with current period hedging transactions

(1,582)

(779)

Amortization of frozen AOCI on de-designated hedge

846

Difference between a change in fair value of excluded components

Closing accumulated derivative instrument gain or loss

$

(2,380)

$

(1,644)

($ in thousands)

    

December 31, 2023

    

December 31, 2022

Beginning accumulated derivative instrument gain or loss

$

3,306

$

279

Net change associated with current period hedging transactions

(813)

2,433

Amortization of frozen AOCI on de-designated hedge

198

594

Difference between a change in fair value of excluded components

Closing accumulated derivative instrument gain or loss

$

2,691

$

3,306

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Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (continued)

Note 11—Income Taxes

The TRS income/(loss) before provision for income taxes consisted of the following:

For the years ended

($ in thousands)

December 31, 2023

December 31, 2022

United States

$

(2,722)

$

3,212

International

Total

$

(2,722)

$

3,212

The federal and state income tax provision (benefit) is summarized as follows:

For the years ended

($ in thousands)

December 31, 2023

December 31, 2022

Current:

Federal

$

(144)

$

189

State

(41)

43

Total Current Tax (Benefit) Expense

$

(185)

$

232

Deferred:

Federal

19

(5)

Total Tax (Benefit) Expense

$

(166)

$

227

Deferred income taxes reflect the net tax effects of (a) temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for income tax purposes, and (b) operating losses and tax credit carryforwards. The tax effects of significant items comprising the TRS’s deferred taxes as of December 31, 2023 are as follows:

($ in thousands)

December 31, 2023

December 31, 2022

Deferred tax assets:

Net operating loss

$

1,996

$

434

Realized capital losses

76

Stock Compensation

5

Deferred Revenue

3

Charitable Contributions

4

Total deferred tax assets

$

2,008

510

Deferred tax liabilities:

Fixed assets

$

(15)

$

(18)

Intangible Assets

(181)

(32)

Total deferred tax liabilities

$

(196)

$

(50)

Valuation Allowance

(1,851)

(480)

Net deferred taxes

$

(39)

$

(20)

ASC 740 requires that the tax benefit of net operating losses, temporary differences and credit carryforwards be recorded as an asset to the extent that management assesses that realization is “more likely than not.” Realization of the future tax benefits is dependent on the TRS’s ability to generate sufficient taxable income within the carryforward period. Because of the TRS’s recent history of operating losses, and management’s inability to accurately project future taxable income, management believes that recognition of the deferred tax assets arising from the above-mentioned future tax benefits is currently not likely to be realized and, accordingly, has provided a valuation allowance. The valuation allowance increased by $1.4 million during the year ended December 31, 2023. The amount of the valuation allowance for deferred tax assets associated with excess tax deduction from stock-based incentive arrangements that is allocated to contributed capital if the future tax benefits are subsequently recognized is $0.0 million.

Net operating losses and tax credit carryforwards as of December 31, 2023 are as follows:

($ in thousands)

December 31, 2023

Expiration Year

Net operating losses, federal (Post-December 31, 2017)

$

7,703

Does not expire

Net operating losses, state

$

5,433

Various

F-34

Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (continued)

The effective tax rate of the TRS’s provision (benefit) for income taxes differs from the federal statutory rate as follows:

($ in thousands)

December 31, 2023

December 31, 2022

Statutory Rate

$

(571)

21.00

%

$

675

21.00

%

State Tax

(191)

7.02

%

110

3.43

%

Valuation Allowance

596

(21.92)

%

(558)

(17.37)

%

Total

$

(166)

6.10

%

$

227

7.07

%

Farmland Partners Inc.

Schedule III – Real Estate and Accumulated Depreciation

December 31, 2020

($ In Thousands)Note 12—Quarterly Financial Information (unaudited)

Initial Cost to Company

Cost Capitalized Subsequent to
Acquisition

Gross Amount at Which
Carried at Close of Period

Life on Which

Description

Encumbrances

Land

Improvements

Total

Improvements

Land
Improvements

Land

Improvements

Total

Accumulated
Depreciation

Date of
Construction

Date Acquired

Depreciation in
Latest Income
Statements is
Computed

California

(m)

44,994

-

44,994

-

0

44,994

-

44,994

-

2017

-

North Carolina

(w)

41,906

-

41,906

5

578

42,484

5

42,489

-

2018

2015

40

California

(m)

33,482

-

33,482

-

0

33,482

-

33,482

-

2017

-

Illinois

(k)

29,627

431

30,058

2,268

50

29,677

2,699

32,376

344

2017, 2018

2017

22

Louisiana

(g)

30,584

1,180

31,764

181

378

30,962

1,361

32,323

243

2018, 2019

2016

27

California

(m)

31,567

-

31,567

-

0

31,567

-

31,567

-

2017

-

California

(p), (s)

19,925

11,521

31,445

(561)

0

19,925

10,960

30,884

3,785

2017

2017

13

Illinois

(k)

22,937

1,484

24,421

1,302

(11)

22,926

2,786

25,711

306

2017, 2018, 2019

2017

26

California

(r)

7,647

11,518

19,164

263

0

7,647

11,781

19,428

1,893

2017, 2018, 2020

2017

21

South Carolina

(t)

12,057

1,474

13,531

5,840

53

12,110

7,314

19,424

876

2014, 2017, 2018, 2019

2014

25

California

(s)

9,998

8,116

18,114

(115)

(0)

9,998

8,001

17,999

2,084

2017

2017

14

California

(s)

10,947

6,878

17,825

64

(0)

10,947

6,942

17,889

1,567

2017

2017

21

North Carolina

(v)

17,627

-

17,627

-

-

17,627

-

17,627

-

2018

-

South Carolina

(l)

14,866

906

15,772

239

(0)

14,866

1,145

16,011

150

2017, 2018

2017

26

Florida

(w)

9,295

202

9,497

2,467

3,433

12,728

2,669

15,397

160

2016, 2017, 2019, 2020

2016

39

California

(s)

11,888

3,398

15,286

(58)

0

11,888

3,340

15,228

960

2017

2017

15

California

(q)

8,326

6,075

14,401

42

(0)

8,326

6,117

14,443

881

2017, 2018, 2019

2017

25

California

(p)

9,043

4,546

13,589

172

(0)

9,043

4,718

13,761

1,080

2017, 2018, 2020

2017

18

California

(q), (s)

10,167

2,902

13,069

197

(0)

10,167

3,099

13,267

930

2017

2017

16

California

(p)

7,492

2,889

10,380

433

0

7,492

3,322

10,814

862

2017, 2019

2017

15

Colorado

(t)

10,716

70

10,786

-

-

10,716

70

10,786

7

2014

2014

39

Illinois

(f)

9,689

420

10,109

(5)

18

9,707

415

10,122

94

2016, 2017, 2018

2016

21

California

(r)

9,534

263

9,796

2

0

9,534

265

9,799

102

2017

2017

14

South Carolina

(w)

8,633

133

8,766

199

39

8,672

332

9,004

32

2015, 2017, 2020

2015

26

California

(s)

6,191

2,772

8,963

0

(0)

6,191

2,772

8,963

656

2017

2017

11

Florida

(q)

2,674

3,565

6,239

2,625

0

2,674

6,190

8,863

981

2017, 2020

2017

16

California

(q)

4,710

3,317

8,027

0

(0)

4,710

3,317

8,027

558

2017

2017

15

Virginia

(w)

7,277

-

7,277

-

-

7,277

-

7,277

-

2015

-

Florida

(o)

6,402

593

6,995

269

0

6,402

862

7,264

222

2017, 2019

2017

17

Arkansas

(t)

6,914

287

7,201

22

16

6,930

309

7,239

54

2014, 2017, 2018

2014

23

North Carolina

(w)

7,239

-

7,239

-

(16)

7,223

-

7,223

-

2015

-

South Carolina

(t)

4,679

25

4,704

2,369

4

4,683

2,394

7,077

392

2020, 2017, 2016, 2015

2014

31

Mississippi

(t)

6,654

133

6,787

3

-

6,654

136

6,790

21

2014, 2015

2014

25

South Dakota

(l)

6,731

-

6,731

-

0

6,731

-

6,731

-

2017

-

Illinois

(f)

6,086

-

6,086

450

11

6,097

450

6,547

33

2018

2016

40

Georgia

(q)

3,574

2,922

6,496

46

0

3,574

2,968

6,542

1,905

2017, 2019

2017

11

Arkansas

(i)

5,924

244

6,168

-

-

5,924

244

6,168

49

2015

2015

21

Illinois

(f)

5,493

-

5,493

338

9

5,502

338

5,841

135

2017

2016

10

North Carolina

(w)

5,750

-

5,750

-

4

5,754

-

5,754

-

2015

-

Arkansas

(o)

5,532

101

5,633

46

3

5,535

147

5,682

40

2017, 2019, 2020

2017

13

Colorado

(j)

792

4,731

5,523

84

1

793

4,815

5,608

323

2016, 2017, 2019

2016

16

Mississippi

(i)

5,338

238

5,576

-

-

5,338

238

5,576

63

2015

2015

15

Illinois

(f)

5,453

105

5,558

7

10

5,463

112

5,575

17

2016

2016

23

Colorado

(l)

4,156

1,280

5,436

(3)

0

4,156

1,277

5,433

199

2017

2017

26

Arkansas

(v)

5,169

185

5,354

(0)

0

5,169

185

5,354

54

2017

2017

15

Louisiana

(t)

5,100

52

5,152

154

-

5,100

206

5,306

51

2017, 2016, 2015

2014

17

Illinois

(f)

4,920

4

4,924

148

8

4,928

152

5,080

11

2017

2016

50

Arkansas

(t)

4,536

50

4,586

81

27

4,563

131

4,693

28

2014, 2017

2014

17

Illinois

(o)

4,575

-

4,575

-

(0)

4,575

-

4,575

-

2017

-

Illinois

(f)

4,522

4

4,526

-

8

4,530

4

4,534

1

2016

2016

10

South Carolina

(t)

2,235

-

2,235

1,577

633

2,868

1,577

4,445

242

2020, 2017, 2016, 2015

2014

26

California

(v)

2,461

1,974

4,435

0

0

2,461

1,974

4,435

356

2017

2017

17

Illinois

(f)

4,350

-

4,350

-

8

4,358

-

4,358

-

2016

-

Arkansas

(j)

4,035

38

4,073

188

-

4,035

226

4,260

22

2016, 2017, 2018, 2019

2016

28

North Carolina

(w)

4,242

-

4,242

-

4

4,246

-

4,246

-

2015

-

The following table reflects the quarterly results of operations for the years ended December 31, 2023 and 2022.

Quarter Ended

($ in thousands except per share data)

March 31, 2023

June 30, 2023

September 30, 2023

December 31, 2023

Operating revenues

    

$

12,672

$

11,584

$

11,618

$

21,592

Operating expenses

7,835

8,828

11,603

11,201

Other expenses (1)

3,114

(5,146)

(4,109)

(7,375)

Net income before income tax expense

1,723

7,902

4,124

17,766

Income tax expense

(9)

(4)

191

(12)

Net income

$

1,714

$

7,898

$

4,315

$

17,754

Net income available to common stockholders of Farmland Partners Inc.

$

857

$

7,001

$

3,446

$

16,482

Basic net income (loss) per share available to common stockholders (2)

$

0.02

$

0.14

$

0.07

$

0.35

Diluted net income (loss) per share available to common stockholders (2)

$

0.02

$

0.12

$

0.07

$

0.30

Basic weighted average common shares outstanding

54,007

50,860

48,432

47,762

Diluted weighted average common shares outstanding

54,007

59,112

48,432

55,635

Quarter Ended

    

March 31, 2022

June 30, 2022

September 30, 2022

December 31, 2022

Operating revenues

$

13,890

$

12,357

$

13,140

$

21,823

Operating expenses

9,570

8,902

8,415

9,349

Other expenses (1)

3,181

366

3,573

5,667

Net income before income tax expense

1,139

3,089

1,152

6,807

Income tax expense

(96)

(33)

(98)

Net income

$

1,139

$

2,993

$

1,119

$

6,709

Net income available to common stockholders of Farmland Partners Inc.

$

213

$

2,060

$

350

$

5,778

Basic net income (loss) per share available to common stockholders (2)

$

0.00

$

0.04

$

0.01

$

0.11

Diluted net income (loss) per share available to common stockholders (2)

$

0.00

$

0.04

$

0.01

$

0.09

Basic weighted average common shares outstanding

45,781

50,362

53,495

54,056

Diluted weighted average common shares outstanding

45,781

50,362

53,495

62,633

(1)Other expenses for the quarters ended March 31, 2023, June 30, 2023, September 30, 2023 and December 31, 2023 included $1.8 million, $11.1 million, $10.3 million, $12.9 million, respectively, related to gain on disposition of assets. Other expenses for the quarters ended March 31, 2022, June 30, 2022, September 30, 2022 and December 31, 2022 included $0.7 million, $3.3 million, ($0.1) million, ($1.3) million, respectively, related to gain (loss) on disposition of assets.
(2)The basic and diluted net (loss) income for the quarters do not equal full year results due to issuance of common stock throughout the year and rounding.

Note 13—Subsequent Events

We have evaluated subsequent events and transactions for potential recognition or disclosure in the financial statements through the day the financial statements were issued.

Dividends

On February 27, 2024, the Company’s Board of Directors declared a quarterly cash dividend of $0.06 per share of common stock and Common unit payable on April 15, 2024 to stockholders and unitholders of record as of April 1, 2024.

F-38F-35

Table of Contents

Farmland Partners Inc.

Notes to Consolidated Financial Statements (continued)

Real Estate Acquisitions

Subsequent to December 31, 2023, the Company completed two farm acquisitions in the Corn Belt region. Aggregate consideration for the acquisitions totaled $15.2 million.

Borrowings on Credit Facilities, Net of Repayments

Subsequent to December 31, 2023, the Company made borrowings, net of repayments, of $25.0 million against the Company’s lines of credit.

F-36

Table of Contents

Farmland Partners Inc.

Schedule III – Real Estate and Accumulated Depreciation

December 31, 20202023

($ In Thousands)

Initial Cost to Company

Cost Capitalized Subsequent to
Acquisition

Gross Amount at Which
Carried at Close of Period

Life on Which

Description

Encumbrances

Land

Improvements

Total

Improvements

Land
Improvements

Land

Improvements

Total

Accumulated
Depreciation

Date of
Construction

Date Acquired

Depreciation in
Latest Income
Statements is
Computed

Colorado

(t)

3,566

359

3,925

67

-

3,566

426

3,992

62

2014, 2017, 2018

2014

20

North Carolina

(w)

3,864

-

3,864

-

8

3,872

-

3,872

-

2015

-

Illinois

(f)

3,821

-

3,821

-

8

3,829

-

3,829

-

2016

-

Georgia

(i)

3,306

368

3,674

18

-

3,306

386

3,692

67

2015, 2016, 2017, 2018

2015

24

Illinois

(h)

2,981

-

2,981

634

-

2,981

634

3,615

87

2017, 2009

2007 & 2010

38

Alabama

(q)

1,719

1,883

3,602

(8)

(0)

1,719

1,875

3,595

328

2017

2017

16

Mississippi

(b)

3,471

41

3,512

63

-

3,471

104

3,575

12

2015, 2017

2015

35

Illinois

(f)

3,541

-

3,541

-

6

3,547

-

3,547

-

2016

-

Illinois

3,500

28

3,528

324

(351)

3,149

352

3,501

32

2016, 2018

2016

28

Illinois

(h)

1,290

-

1,290

2,199

-

1,290

2,199

3,488

280

2017, 2015, 2011

2007

38

Illinois

(f)

3,470

-

3,470

4

6

3,476

4

3,480

1

2016

2016

12

Nebraska

(t)

1,881

55

1,936

1,476

1

1,882

1,531

3,413

230

2017, 2015, 2012

2012

31

Illinois

(f)

2,997

68

3,065

253

5

3,002

321

3,323

123

2018, 2016

2016

16

Illinois

(f)

3,212

-

3,212

95

6

3,218

95

3,313

7

2018

2016

40

Illinois

(f)

3,277

-

3,277

-

5

3,282

-

3,282

-

2016

-

South Carolina

(b)

1,959

344

2,303

970

-

1,959

1,314

3,273

128

2017, 2015

2015

35

Illinois

(f)

3,186

-

3,186

-

74

3,260

-

3,260

-

2016

-

Illinois

(f)

3,232

-

3,232

-

(63)

3,169

-

3,169

-

2016

-

Illinois

(o)

3,163

-

3,163

-

(0)

3,163

-

3,163

-

2017

-

Arkansas

(w)

2,808

184

2,992

70

51

2,859

254

3,113

58

2015, 2017, 2018, 2020

2015

20

Georgia

(l)

1,905

-

1,905

982

202

2,107

982

3,089

89

2017, 2018

2017

32

Illinois

(f)

3,058

-

3,058

-

5

3,063

-

3,063

-

2016

-

Arkansas

(t)

2,985

156

3,141

8

(96)

2,889

164

3,053

46

2014, 2016

2014

16

Illinois

(f)

3,030

-

3,030

-

6

3,036

-

3,036

-

2016

-

Arkansas

(b)

3,264

165

3,429

191

(590)

2,674

356

3,030

77

2014, 2015, 2016, 2017

2014

27

South Carolina

(t)

2,199

138

2,337

670

22

2,221

808

3,028

86

2014, 2015, 2017, 2019, 2020

2014

30

Colorado

(t)

3,099

-

3,099

-

(133)

2,966

-

2,966

-

2014

-

Illinois

(f)

2,882

42

2,924

-

5

2,887

42

2,929

13

2016

2016

12

Illinois

(f)

2,682

-

2,682

204

8

2,690

204

2,894

15

2017

2016

50

Nebraska

(c)

2,601

114

2,715

131

-

2,601

245

2,845

20

2015, 2016, 2018, 2019

2015

27

Illinois

(h)

2,573

-

2,573

236

(1)

2,572

236

2,809

19

2017

2010

50

North Carolina

(v)

2,768

-

2,768

-

-

2,768

-

2,768

-

2018

-

Arkansas

(t)

2,645

40

2,685

42

21

2,666

82

2,748

12

2014, 2018, 2019

2014

18

Illinois

(f)

2,718

-

2,718

-

5

2,723

-

2,723

-

2016

-

California

(s)

967

1,357

2,324

375

(0)

967

1,732

2,699

327

2017, 2018

2017

21

Nebraska

(c)

2,539

78

2,617

(23)

-

2,539

55

2,594

11

2016

2015

20

Nebraska

(w)

693

1,785

2,478

90

-

693

1,875

2,567

227

2014, 2016, 2018, 2019

2014

17

Michigan

(i)

904

1,654

2,558

-

-

904

1,654

2,558

291

2015

2015

23

Illinois

(f)

2,542

-

2,542

-

5

2,547

-

2,547

-

2016

-

Colorado

(b)

1,995

84

2,079

466

-

1,995

550

2,545

111

2018, 2017, 2016

2015

17

Illinois

(l)

2,525

-

2,525

-

(0)

2,525

-

2,525

-

2017

-

Arkansas

(t)

2,262

82

2,344

4

96

2,358

86

2,444

12

2014, 2015

2014

27

Illinois

(f)

2,423

-

2,423

-

5

2,428

-

2,428

-

2016

-

Nebraska

(c)

2,280

44

2,324

95

-

2,280

139

2,419

25

2017, 2016, 2015

2015

22

Illinois

(f)

2,402

-

2,402

-

4

2,406

-

2,406

-

2016

-

South Carolina

(t)

1,803

158

1,961

422

-

1,803

580

2,383

53

2014, 2015, 2020

2014

26

South Carolina

(l)

1,321

91

1,412

721

246

1,567

812

2,379

73

2017, 2018, 2020

2017

34

South Carolina

(v)

1,406

806

2,212

128

(0)

1,406

934

2,341

150

2017, 2018, 2019

2017

31

Colorado

(t)

2,328

-

2,328

-

-

2,328

-

2,328

-

2014

-

Arkansas

(t)

2,316

-

2,316

3

-

2,316

3

2,319

-

2014

-

Nebraska

(c)

2,316

126

2,442

(126)

-

2,316

-

2,316

-

2015

-

Colorado

637

1,604

2,241

-

0

637

1,604

2,241

328

2017

2017

27

Illinois

(f)

2,015

-

2,015

216

4

2,019

216

2,235

12

2016, 2019

2016

34

Illinois

(f)

2,100

-

2,100

98

4

2,104

98

2,202

7

2018

2016

40

F-39

Table of Contents

Farmland Partners Inc.

Schedule III – Real Estate and Accumulated Depreciation

December 31, 2020

($ In Thousands)

Initial Cost to Company

Cost Capitalized Subsequent to
Acquisition

Gross Amount at Which
Carried at Close of Period

Life on Which

Description

Encumbrances

Land

Improvements

Total

Improvements

Land
Improvements

Land

Improvements

Total

Accumulated
Depreciation

Date of
Construction

Date Acquired

Depreciation in
Latest Income
Statements is
Computed

North Carolina

(v)

2,177

-

2,177

-

-

2,177

-

2,177

-

2018

-

Colorado

(b)

1,365

663

2,028

101

-

1,365

764

2,129

81

2015

2015

21

Arkansas

(t)

2,014

96

2,110

-

(8)

2,006

96

2,102

22

2014

2014

22

South Carolina

(v)

1,090

-

1,090

776

230

1,320

776

2,097

52

2018, 2019

2018

39

Illinois

(f)

2,075

-

2,075

-

4

2,079

-

2,079

-

2016

-

Colorado

(w)

1,301

699

2,000

70

-

1,301

769

2,070

71

2015, 2016, 2017, 2019

2015

26

South Carolina

(t)

1,568

-

1,568

433

64

1,632

433

2,065

52

2015, 2017, 2019

2014

27

Illinois

(h)

1,700

-

1,700

346

-

1,700

346

2,046

38

2017

2012

35

Colorado

(t)

1,817

210

2,027

1

(7)

1,810

211

2,021

69

2014, 2016

2014

14

Illinois

(f)

1,996

-

1,996

-

3

1,999

-

1,999

-

2016

-

Colorado

(j)

1,760

-

1,760

239

-

1,760

239

1,999

31

2017

2016

24

Illinois

(f)

2,103

105

2,208

-

(226)

1,877

105

1,982

17

2016

2016

25

Illinois

(f)

1,972

-

1,972

-

3

1,975

-

1,975

-

2016

-

Illinois

(f)

1,956

-

1,956

-

4

1,960

-

1,960

-

2016

-

Illinois

(f)

1,945

-

1,945

-

4

1,949

-

1,949

-

2016

-

Illinois

(j)

1,905

-

1,905

-

-

1,905

-

1,905

-

2016

-

Colorado

(w)

1,622

-

1,622

271

-

1,622

271

1,894

6

2020

2019

28

Illinois

(f)

1,891

-

1,891

-

3

1,894

-

1,894

-

2016

-

Colorado

(t)

1,079

812

1,891

-

-

1,079

812

1,891

72

2014

2014

31

Illinois

(f)

1,859

-

1,859

-

4

1,863

-

1,863

-

2016

-

Illinois

(f)

1,853

-

1,853

-

3

1,856

-

1,856

-

2016

-

Illinois

(o)

1,825

-

1,825

-

-

1,825

-

1,825

-

2018

-

Illinois

(f)

1,693

-

1,693

109

3

1,696

109

1,805

8

2017

2016

50

Illinois

(f)

1,769

-

1,769

-

3

1,772

-

1,772

-

2016

-

North Carolina

(w)

1,770

-

1,770

-

-

1,770

-

1,770

-

2015

-

Illinois

(h)

1,750

-

1,750

-

-

1,750

-

1,750

-

2009

-

Illinois

(o)

1,735

-

1,735

-

0

1,735

-

1,735

-

2017

-

Illinois

(f)

1,731

-

1,731

-

3

1,734

-

1,734

-

2016

-

Illinois

(f)

1,643

88

1,731

-

3

1,646

88

1,734

15

2016

2016

23

Illinois

(f)

1,718

-

1,718

-

3

1,721

-

1,721

-

2016

-

Nebraska

(t)

1,610

32

1,642

81

(2)

1,608

113

1,720

16

2014, 2015

2014

28

Illinois

(f)

1,614

94

1,708

-

3

1,617

94

1,711

16

2016

2016

23

Nebraska

(t)

1,639

46

1,685

10

(2)

1,637

56

1,694

8

2014, 2015

2014

31

Colorado

(t)

1,305

376

1,681

10

-

1,305

386

1,691

143

2014, 2016

2014

16

Illinois

(f)

1,675

4

1,679

(4)

3

1,678

-

1,678

-

2016

-

Michigan

(i)

779

851

1,630

39

-

779

890

1,669

251

2016, 2019

2016

19

South Carolina

(w)

1,303

225

1,528

134

-

1,303

359

1,663

47

2016, 2017, 2020

2016

35

South Carolina

(t)

1,078

-

1,078

548

29

1,107

548

1,655

66

2015, 2017

2014

30

Illinois

(f)

1,523

-

1,523

126

3

1,526

126

1,651

9

2017

2016

50

Illinois

(f)

1,620

-

1,620

-

3

1,623

-

1,623

-

2016

-

Nebraska

(c)

1,314

65

1,379

242

-

1,314

307

1,621

56

2015

2015

20

Nebraska

(t)

1,539

-

1,539

70

-

1,539

70

1,608

6

2015

2012

45

Illinois

(f)

1,603

-

1,603

-

3

1,606

-

1,606

-

2016

-

Nebraska

(b)

1,244

69

1,313

269

-

1,244

338

1,582

38

2014, 2015

2014

22

Georgia

(j)

1,330

72

1,402

180

-

1,330

252

1,581

30

2016, 2019

2016

19

Illinois

(h)

1,423

60

1,483

68

-

1,423

128

1,551

27

2013

2007

27

Colorado

(t)

1,353

184

1,537

-

-

1,353

184

1,537

89

2014

2014

9

Illinois

(t)

1,500

-

1,500

26

-

1,500

26

1,526

2

2015

2008

50

Kansas

(i)

1,915

-

1,915

-

(395)

1,520

-

1,520

-

2015

-

Illinois

(f)

1,481

-

1,481

-

3

1,484

-

1,484

-

2016

-

Illinois

(o)

1,471

-

1,471

-

-

1,471

-

1,471

-

2018

-

Mississippi

(w)

1,437

33

1,470

-

-

1,437

33

1,470

4

2015, 2017

2015

29

Illinois

(f)

1,435

-

1,435

-

3

1,438

-

1,438

-

2016

-

South Carolina

(l)

1,032

170

1,203

218

13

1,045

388

1,433

48

2017, 2018

2017

24

Illinois

(w)

1,403

-

1,403

-

-

1,403

-

1,403

-

2019

-

F-40

Table of Contents

Farmland Partners Inc.

Schedule III – Real Estate and Accumulated Depreciation

December 31, 2020

($ In Thousands)

Initial Cost to Company

Cost Capitalized Subsequent to
Acquisition

Gross Amount at Which
Carried at Close of Period

Life on Which

Description

Encumbrances

Land

Improvements

Total

Improvements

Land
Improvements

Land

Improvements

Total

Accumulated
Depreciation

Date of
Construction

Date Acquired

Depreciation in
Latest Income
Statements is
Computed

Nebraska

(b)

1,100

28

1,128

248

-

1,100

276

1,376

23

2014, 2015, 2018

2014

22

Nebraska

(v)

1,149

-

1,149

202

-

1,149

202

1,350

17

2018

2018

33

Illinois

(f)

1,229

-

1,229

116

2

1,231

116

1,347

9

2018

2016

40

Nebraska

(c)

1,346

34

1,380

(34)

-

1,346

-

1,346

-

2015

-

Illinois

(f)

1,320

-

1,320

-

2

1,322

-

1,322

-

2016

-

Nebraska

(i)

1,232

56

1,288

-

31

1,263

56

1,319

7

2015

2015

24

Nebraska

(c)

1,279

23

1,302

6

-

1,279

29

1,308

10

2015, 2017

2015

12

Colorado

(t)

1,238

-

1,238

-

45

1,283

-

1,283

-

2014

-

Nebraska

(c)

1,242

37

1,279

(5)

-

1,242

32

1,273

5

2015

2015

23

Illinois

(f)

1,259

-

1,259

-

2

1,261

-

1,261

-

2016

-

Illinois

(b)

1,120

-

1,120

138

-

1,120

138

1,258

11

2016

2008

50

Illinois

(f)

1,254

-

1,254

-

2

1,256

-

1,256

-

2016

-

Colorado

(t)

1,030

170

1,200

31

-

1,030

201

1,231

102

2014, 2016, 2017

2014

14

Illinois

(f)

1,219

-

1,219

-

2

1,221

-

1,221

-

2016

-

Illinois

(t)

1,147

-

1,147

60

-

1,147

60

1,207

5

2016

2013

50

Illinois

(h)

1,003

-

1,003

198

-

1,003

198

1,201

12

2015, 2017

2008

40

Nebraska

(c)

1,077

33

1,110

80

-

1,077

113

1,189

7

2015

2015

23

Colorado

(t)

579

513

1,092

18

65

644

531

1,175

185

2014, 2015, 2016

2014

19

Illinois

(f)

1,171

-

1,171

-

2

1,173

-

1,173

-

2016

-

Illinois

(f)

1,126

44

1,170

-

2

1,128

44

1,172

6

2016

2016

31

Illinois

(f)

1,130

35

1,165

-

2

1,132

35

1,167

8

2016

2016

23

North Carolina

(v)

1,161

-

1,161

-

-

1,161

-

1,161

-

2018

-

Illinois

(f)

1,439

-

1,439

-

(279)

1,160

-

1,160

-

2016

-

Illinois

(f)

1,115

28

1,143

9

2

1,117

37

1,155

9

2016, 2018

2016

20

Nebraska

(h)

1,109

40

1,149

-

-

1,109

40

1,149

8

2012

2012

20

Nebraska

(c)

1,136

11

1,147

-

-

1,136

11

1,147

7

2015

2015

6

Illinois

(f)

1,075

-

1,075

70

2

1,077

70

1,147

5

2018

2016

40

Colorado

(t)

747

393

1,140

-

-

747

393

1,140

47

2014

2014

26

Illinois

(f)

1,119

-

1,119

-

2

1,121

-

1,121

-

2016

-

Colorado

(t)

1,128

68

1,196

(32)

(45)

1,083

36

1,119

3

2014

-

Colorado

(t)

1,105

-

1,105

-

-

1,105

-

1,105

-

2014

-

Colorado

(t)

773

323

1,096

-

-

773

323

1,096

46

2014

2014

21

Illinois

(f)

1,063

27

1,090

-

2

1,065

27

1,092

9

2016

2016

23

Illinois

(f)

1,080

-

1,080

-

2

1,082

-

1,082

-

2016

-

Illinois

(f)

1,083

-

1,083

-

(6)

1,077

-

1,077

-

2016

-

Illinois

(f)

$ 989

$ -

$ 989

$ 77

$ 2

$ 991

$ 77

$ 1,068

$ 6

2018

2016

40

Nebraska

(i)

848

197

1,045

22

-

848

219

1,067

34

2014, 2015, 2017

2014

25

Colorado

(t)

554

443

997

70

(3)

551

513

1,064

51

2014, 2015, 2017

2014

28

Illinois

(f)

1,058

-

1,058

-

2

1,060

-

1,060

-

2016

-

Illinois

(f)

995

-

995

58

2

997

58

1,054

4

2017

2016

50

Nebraska

(t)

994

20

1,014

41

(2)

992

61

1,052

11

2014, 2015

2014

27

Illinois

(t)

801

97

898

152

-

801

249

1,050

20

2016

2004, 2006, 2016

50

Colorado

(h)

819

94

913

113

-

819

207

1,026

36

2014, 2017, 2018

2010

20

Colorado

(w)

809

141

950

64

-

809

205

1,014

28

2015

2015

31

Illinois

(f)

1,005

-

1,005

-

2

1,007

-

1,007

-

2016

-

Georgia

(i)

795

65

860

105

31

826

170

997

21

2016, 2017

2016

31

Illinois

(f)

950

40

990

-

2

952

40

992

5

2016

2016

32

Illinois

(h)

991

-

991

-

-

991

-

991

-

2012

-

Illinois

(f)

980

-

980

-

2

982

-

982

-

2016

-

Illinois

(f)

975

-

975

-

2

977

-

977

-

2016

-

Illinois

(f)

972

-

972

-

2

974

-

974

-

2016

-

Illinois

(f)

968

-

968

-

2

970

-

970

-

2016

-

Georgia

(w)

756

202

958

-

(1)

755

202

958

22

2016

2016

36

Illinois

(f)

844

-

844

112

2

846

112

958

3

2019

2016

40

Illinois

(h)

923

53

976

(29)

-

923

24

947

2

2011

2011

50

F-41

Table of Contents

Farmland Partners Inc.

Schedule III – Real Estate and Accumulated Depreciation

December 31, 2020

($ In Thousands)

Initial Cost to Company

Cost Capitalized Subsequent to
Acquisition

Gross Amount at Which
Carried at Close of Period

Life on Which

Description

Encumbrances

Land

Improvements

Total

Improvements

Land
Improvements

Land

Improvements

Total

Accumulated
Depreciation

Date of
Construction

Date Acquired

Depreciation in
Latest Income
Statements is
Computed

Kansas

(t)

805

178

983

-

(38)

767

178

945

70

2014

2014

14

Illinois

(f)

939

-

939

-

1

940

-

940

-

2016

-

Illinois

(t)

902

34

936

-

-

902

34

936

6

2008

2008

21

Illinois

(f)

800

130

930

-

2

802

130

932

20

2016

2016

27

Illinois

(f)

845

63

908

-

2

847

63

910

13

2016

2016

22

Colorado

(t)

481

373

854

2

46

527

375

902

136

2014, 2016

2014

17

Illinois

(f)

855

55

910

(12)

1

856

43

899

6

2016

2016

28

Illinois

(f)

879

-

879

4

2

881

4

884

1

2016

2016

20

Illinois

(w)

866

18

884

-

-

866

18

884

-

2020

2020

48

Illinois

(i)

815

-

815

60

-

815

60

875

5

2017

2015

50

Georgia

(j)

718

144

862

10

-

718

154

872

25

2016

2016

25

Illinois

(f)

864

-

864

-

1

865

-

865

-

2016

-

Nebraska

(b)

862

-

862

-

-

862

-

862

-

2015

-

Illinois

(f)

857

-

857

-

1

858

-

858

-

2016

-

Illinois

(f)

854

-

854

-

1

855

-

855

-

2016

-

Illinois

(h)

644

93

737

107

-

644

200

844

16

2015

2000

50

Illinois

(i)

762

-

762

75

-

762

75

837

15

2016

2015

20

Nebraska

(t)

742

-

742

94

-

742

94

836

15

2013

2012

25

Illinois

(b)

700

110

810

20

-

700

130

830

10

2006, 2015

2004

50

Illinois

(l)

825

-

825

-

0

825

-

825

-

2017

-

Illinois

(f)

774

47

821

-

2

776

47

823

8

2016

2016

25

Illinois

(o)

805

-

805

-

(0)

805

-

805

-

2017

-

Colorado

(t)

803

-

803

-

-

803

-

803

-

2014

-

Illinois

(f)

775

-

775

3

2

777

3

780

-

2018

2016

50

Nebraska

(t)

702

72

774

-

(2)

700

72

772

8

2014

2014

35

Illinois

(f)

762

-

762

-

1

763

-

763

-

2016

-

Illinois

(o)

748

-

748

-

(0)

748

-

748

-

2017

-

Illinois

(f)

746

-

746

-

2

748

-

748

-

2016

-

Illinois

(f)

744

-

744

-

2

746

-

746

-

2016

-

Kansas

(t)

737

-

737

-

-

737

-

737

-

2014

-

Nebraska

(i)

711

22

733

-

-

711

22

733

4

2015

2015

20

Illinois

(f)

732

-

732

-

1

733

-

733

-

2016

-

Illinois

(f)

729

-

729

-

1

730

-

730

-

2016

-

Illinois

(f)

727

-

727

-

2

729

-

729

-

2016

-

Illinois

(h)

725

-

725

-

-

725

-

725

-

2010

-

Illinois

(h)

668

-

668

51

1

669

51

720

4

2015

2007

50

Illinois

(o)

717

-

717

-

-

717

-

717

-

2018

-

Illinois

(f)

671

96

767

(54)

1

672

42

714

6

2016

2016

28

Illinois

(v)

701

-

701

-

(0)

701

-

701

-

2017

-

Illinois

(j)

667

30

697

-

-

667

30

697

5

2016

2016

24

Illinois

(h)

693

-

693

-

-

693

-

693

-

2008

-

Georgia

(i)

555

106

661

9

18

573

115

687

15

2015, 2018, 2019

2015

32

Illinois

(h)

684

-

684

-

-

684

-

684

-

2007

-

South Carolina

(l)

477

57

534

148

(0)

477

205

682

22

2017

2017

32

Illinois

(i)

681

-

681

-

-

681

-

681

-

2015

-

Illinois

(i)

667

-

667

-

1

668

-

668

-

2016

-

Illinois

(h)

448

100

548

110

-

448

210

658

17

2006, 2015

2003

50

Illinois

(o)

652

-

652

-

-

652

-

652

-

2018

-

Illinois

(f)

612

38

650

-

1

613

38

651

5

2016

2016

29

Georgia

(i)

482

142

624

-

10

492

142

634

19

2016, 2017

2016

27

Illinois

(f)

630

-

630

-

1

631

-

631

-

2016

2016

-

Illinois

(f)

617

-

617

-

1

618

-

618

-

2016

-

Illinois

(h)

610

-

610

-

-

610

-

610

-

2012

-

Colorado

(t)

374

201

575

2

30

404

203

608

73

2014, 2016, 2017

2014

11

Nebraska

(b)

607

-

607

-

-

607

-

607

-

2015

-

Initial Cost to Company

Cost Capitalized Subsequent to
Acquisition

Gross Amount at Which
Carried at Close of Period

Life on Which Depreciation in
Latest Income

Description

Encumbrances

Land

Improvements

Total

Land

Improvements

Total

Land

Improvements

Total

Accumulated
Depreciation

Date of
Construction

Date Acquired

Statements is
Computed

California

(j)

44,994

44,994

44,994

44,994

2017

North Carolina

(l)

41,906

41,906

1,187

5

1,192

43,093

5

43,098

1

2018

2015

40

California

(j)

33,482

33,482

33,482

33,482

2017

California

(q)

19,925

11,521

31,446

1,765

1,765

19,925

13,286

33,211

5,387

2017, 2019, 2022, 2023

2017

16

Illinois

(o)

29,677

431

30,108

2,429

2,429

29,677

2,860

32,537

592

2017, 2018, 2023

2017

25

California

(j)

31,567

31,567

31,567

31,567

2017

Illinois

(h)

22,887

1,484

24,371

39

1,820

1,859

22,926

3,304

26,230

562

2017, 2018, 2019, 2023

2017

26

Louisiana

(m)

24,882

128

25,010

131

195

326

25,013

323

25,336

51

2021, 2022

2021

6

California

(q)

7,647

11,518

19,165

859

859

7,647

12,377

20,024

2,987

2017, 2018, 2020, 2021, 2022

2017

25

South Carolina

(p)

12,057

1,474

13,531

53

6,079

6,132

12,110

7,553

19,663

1,798

2014, 2017, 2018, 2019, 2020, 2021

2014

25

California

(q)

9,998

8,116

18,114

163

163

9,998

8,279

18,277

3,377

2017, 2021

2017

16

California

(q)

10,935

6,878

17,813

243

243

10,935

7,121

18,056

2,424

2017, 2021, 2023

2017

27

North Carolina

(k)

17,627

17,627

17,627

17,627

2018

California

(q)

11,888

3,398

15,286

741

741

11,888

4,139

16,027

1,482

2017, 2021, 2022, 2023

2017

20

South Carolina

(i)

14,866

906

15,772

228

228

14,866

1,134

16,000

252

2017, 2018

2017

27

Florida

(l)

9,295

202

9,497

3,439

2,531

5,970

12,734

2,733

15,467

387

2016, 2017, 2019, 2020, 2021

2016

37

California

(q)

8,326

6,075

14,401

33

33

8,326

6,108

14,434

1,480

2017, 2018, 2019, 2021, 2022

2017

27

Texas

(d)

5,773

6,338

12,111

63

63

5,773

6,401

12,174

501

2022, 2023

2022

11

Nebraska

(d)

11,325

309

11,634

171

171

11,325

480

11,805

93

2022, 2023

2022

8

Louisiana

10,771

10,771

237

237

10,771

237

11,008

7

2023

2023

9

California

(q)

8,340

4,546

12,886

(2,072)

(2,072)

8,340

2,474

10,814

967

2017, 2020, 2021, 2023

2017

18

Colorado

(p)

10,716

70

10,786

10,716

70

10,786

17

2014

2014

39

California

(q)

9,534

263

9,797

(29)

(29)

9,534

234

9,768

137

2017

2017

16

California

(q)

6,191

2,772

8,963

(94)

(94)

6,191

2,678

8,869

1,028

2017

2017

14

Oklahoma

(n)

8,181

8,181

681

681

8,181

681

8,862

32

2023

2023

10

South Carolina

(l)

7,904

133

8,037

62

62

7,904

195

8,099

31

2015, 2017, 2020

2015

24

Arkansas

(p)

6,914

287

7,201

16

224

240

6,930

511

7,441

141

2014, 2017, 2018, 2021, 2022

2014

23

Illinois

7,359

420

7,779

1

(350)

(349)

7,360

70

7,430

38

2016

2016

15

North Carolina

(l)

7,223

7,223

7,223

7,223

2015

Illinois

(o)

6,097

6,097

450

450

6,097

450

6,547

67

2018

2016

40

Missouri

(d)

6,493

15

6,508

6,493

15

6,508

4

2021

2021

15

Illinois

(o)

6,429

6,429

6,429

6,429

2016

Arkansas

(f)

5,924

244

6,168

5,924

244

6,168

105

2015

2015

21

Illinois

(e)

5,502

5,502

338

338

5,502

338

5,840

245

2016

2016

10

California

(d)

5,446

390

5,836

5,446

390

5,836

99

2021, 2023

2021

11

North Carolina

(l)

5,750

5,750

29

29

5,779

5,779

2015

California

(q)

3,559

3,317

6,876

(1,122)

(1,122)

3,559

2,195

5,754

560

2017

2017

27

Colorado

(g)

793

4,731

5,524

178

178

793

4,909

5,702

585

2016, 2017, 2019, 2021, 2022

2016

21

Arkansas

(q)

5,532

101

5,633

15

41

56

5,547

142

5,689

70

2017, 2019, 2020

2017

15

Colorado

(d)

3,388

147

3,535

2,068

2,068

3,388

2,215

5,603

340

2021

2021

7

Illinois

(e)

5,463

105

5,568

7

7

5,463

112

5,575

33

2016

2016

23

Louisiana

(p)

5,100

52

5,152

282

282

5,100

334

5,434

124

2014, 2015, 2016, 2017, 2021, 2022, 2023

2014

17

Colorado

(i)

4,156

1,280

5,436

(3)

(3)

4,156

1,277

5,433

358

2017

2017

26

Arkansas

(d)

5,169

185

5,354

5,169

185

5,354

99

2017

2017

15

Illinois

(e)

4,928

4

4,932

148

148

4,928

152

5,080

20

2017

2016

50

Illinois

(d)

4,819

20

4,839

4,819

20

4,839

6

2022

2022

5

Arkansas

(p)

4,536

50

4,586

27

81

108

4,563

131

4,694

54

2014, 2017

2014

17

Illinois

(q)

4,575

4,575

4,575

4,575

2017

Illinois

(o)

4,530

4

4,534

4,530

4

4,534

3

2016

2016

10

California

(k)

2,461

1,974

4,435

(2)

(2)

2,461

1,972

4,433

372

2017, 2018, 2022, 2023

2017

20

Mississippi

(p)

4,330

133

4,463

(35)

(35)

4,330

98

4,428

37

2014, 2015

2014

23

Illinois

(o)

4,358

4,358

4,358

4,358

2016

North Carolina

(l)

4,242

4,242

14

14

4,256

4,256

2015

Colorado

(p)

3,566

359

3,925

94

94

3,566

453

4,019

142

2014, 2016, 2017, 2018, 2021

2014

21

Illinois

(o)

3,818

3,818

1

1

3,819

3,819

2016

Louisiana

(n)

3,612

20

3,632

165

165

3,612

185

3,797

18

2021, 2022

2021

19

Illinois

(d)

2,981

2,981

634

634

2,981

634

3,615

293

2009, 2015

2014

38

Mississippi

(b)

3,471

41

3,512

63

63

3,471

104

3,575

26

2015, 2017

2015

35

F-42F-37

Table of Contents

Farmland Partners Inc.

Schedule III – Real Estate and Accumulated Depreciation (continued)

December 31, 20202023

($ In Thousands)

Initial Cost to Company

Cost Capitalized Subsequent to
Acquisition

Gross Amount at Which
Carried at Close of Period

Life on Which

Description

Encumbrances

Land

Improvements

Total

Improvements

Land
Improvements

Land

Improvements

Total

Accumulated
Depreciation

Date of
Construction

Date Acquired

Depreciation in
Latest Income
Statements is
Computed

Georgia

(w)

469

108

577

25

-

469

133

603

12

2016

2016

36

Illinois

(f)

601

-

601

-

1

602

-

602

-

2016

-

Nebraska

(b)

561

-

561

-

41

602

-

602

-

2014

-

Illinois

(f)

552

-

552

31

1

553

31

583

1

2019

2016

40

Illinois

(t)

527

37

564

16

-

527

53

580

4

2011

2011

50

Illinois

(f)

576

-

576

-

1

577

-

577

-

2016

-

Illinois

(j)

563

-

563

-

-

563

-

563

-

2016

-

South Carolina

460

-

460

98

-

460

98

558

5

2019, 2020

2018

24

North Carolina

(v)

554

-

554

-

-

554

-

554

-

2018

-

Georgia

(i)

475

53

528

16

-

475

69

545

14

2015, 2018

2015

17

Illinois

(f)

536

-

536

-

1

537

-

537

-

2016

-

Illinois

(f)

534

-

534

-

1

535

-

535

-

2016

-

Illinois

(f)

487

-

487

41

1

488

41

529

3

2017

2016

50

Illinois

(f)

505

-

505

-

9

514

-

514

-

2016

-

Nebraska

(c)

500

10

510

-

-

500

10

510

7

2015

2015

6

Illinois

(f)

507

-

507

-

1

508

-

508

-

2016

-

Kansas

(l)

319

181

500

(0)

0

319

181

500

35

2017, 2019

2017

25

Illinois

(h)

442

38

480

-

-

442

38

480

6

2009

2009

24

Illinois

(f)

466

-

466

-

1

467

-

467

-

2016

-

Illinois

(f)

421

-

421

43

1

422

43

465

3

2016

2016

50

South Carolina

(v)

354

-

354

109

-

354

109

463

8

2018, 2019, 2020

2018

23

Illinois

(f)

447

-

447

-

-

447

-

447

-

2016

-

Illinois

(o)

428

-

428

-

-

428

-

428

-

2018

-

Colorado

(t)

419

-

419

-

-

419

-

419

-

2014

-

Illinois

(h)

290

38

328

87

-

290

125

415

10

2006, 2015

2006

50

Illinois

(i)

371

-

371

38

-

371

38

409

3

2017

2016

50

Illinois

(b)

398

-

398

-

-

398

-

398

-

2008

-

Colorado

(i)

-

-

-

-

395

395

-

395

-

2015

-

Illinois

(h)

322

36

358

22

-

322

58

380

5

2006, 2017, 2018

2006

44

Illinois

(f)

370

-

370

-

1

371

-

371

-

2016

-

Illinois

(f)

362

-

362

-

1

363

-

363

-

2016

-

Illinois

(o)

363

-

363

-

-

363

-

363

-

2018

-

Illinois

(t)

102

59

161

201

-

102

260

362

21

2006, 2017

2003

50

Illinois

(f)

360

-

360

-

1

361

-

361

-

2016

-

Illinois

(f)

359

-

359

-

1

360

-

360

-

2016

-

Illinois

(h)

271

73

344

16

-

271

89

360

7

2006, 2015

2001

50

Illinois

(f)

353

-

353

-

1

354

-

354

-

2016

-

Illinois

(t)

321

24

345

(8)

-

321

16

337

1

2011

2011

50

Illinois

(f)

296

-

296

39

-

296

39

335

1

2019

2016

40

Kansas

(j)

235

90

325

3

-

235

93

328

17

2016, 2017

2016

21

Illinois

(f)

320

-

320

-

1

321

-

321

-

2016

-

North Carolina

(v)

310

-

310

-

-

310

-

310

-

2018

-

Colorado

(t)

224

-

224

46

39

263

46

309

-

2014

-

Michigan

298

-

298

-

-

298

-

298

-

2020

-

Illinois

(f)

286

-

286

-

1

287

-

287

-

2016

-

Illinois

(f)

282

-

282

-

1

283

-

283

-

2016

-

Colorado

(t)

276

-

276

-

-

276

-

276

-

2014

-

Illinois

(f)

254

-

254

-

1

255

-

255

-

2016

-

Illinois

(h)

252

-

252

-

-

252

-

252

-

2012

-

Illinois

(f)

240

-

240

-

-

240

-

240

-

2016

-

Colorado

(i)

236

-

236

-

-

236

-

236

-

2015

-

Illinois

(f)

233

-

233

-

-

233

-

233

-

2016

-

Illinois

(o)

233

-

233

-

-

233

-

233

-

2018

-

Illinois

(h)

203

44

247

(24)

-

203

20

223

2

2006

2006

50

Illinois

(f)

216

-

216

-

1

217

-

217

-

2016

-

Initial Cost to Company

Cost Capitalized Subsequent to
Acquisition

Gross Amount at Which
Carried at Close of Period

Life on Which Depreciation in
Latest Income

Description

Encumbrances

Land

Improvements

Total

Land

Improvements

Total

Land

Improvements

Total

Accumulated
Depreciation

Date of
Construction

Date Acquired

Statements is
Computed

Illinois

(o)

3,547

3,547

3,547

3,547

2016

Illinois

(d)

1,290

1,290

2,199

2,199

1,290

2,199

3,489

736

2011, 2015, 2017

2014

38

Illinois

(o)

3,476

3,476

4

4

3,476

4

3,480

2

2016

2016

12

Illinois

(d)

3,401

16

3,417

3,401

16

3,417

3

2022

2022

10

Nebraska

(p)

1,882

55

1,937

1,422

1,422

1,882

1,477

3,359

563

2012, 2013, 2015, 2017

2014

35

Illinois

(o)

3,002

68

3,070

253

253

3,002

321

3,323

227

2016, 2018

2016

16

Illinois

(e)

3,218

3,218

95

95

3,218

95

3,313

14

2018

2016

40

Illinois

(o)

3,282

3,282

3,282

3,282

2016

South Carolina

(b)

1,959

344

2,303

970

970

1,959

1,314

3,273

258

2015, 2017, 2021

2015

34

Arkansas

(l)

2,808

184

2,992

88

100

188

2,896

284

3,180

88

2015, 2017, 2018, 2020, 2021, 2022

2015

23

Illinois

(q)

3,163

3,163

3,163

3,163

2017

Illinois

(o)

3,063

3,063

3,063

3,063

2016

Illinois

(o)

3,036

3,036

3,036

3,036

2016

Illinois

(d)

2,912

89

3,001

2,912

89

3,001

17

2022

2022

7

Illinois

(o)

2,687

2,687

3

204

207

2,690

204

2,894

27

2017

2016

50

Illinois

(e)

2,875

42

2,917

(42)

(42)

2,875

2,875

2016

2016

12

Nebraska

(c)

2,601

114

2,715

133

133

2,601

247

2,848

60

2015, 2016, 2018, 2019

2015

29

Illinois

(d)

2,572

2,572

236

236

2,572

236

2,808

33

2017

2014

50

North Carolina

(k)

2,768

2,768

2,768

2,768

2018

Arkansas

(p)

2,666

40

2,706

46

46

2,666

86

2,752

41

2014, 2018, 2019

2014

18

Illinois

(o)

2,723

2,723

2,723

2,723

2016

Illinois

(d)

2,661

2,661

2,661

2,661

2021

South Carolina

(i)

1,321

91

1,412

246

955

1,201

1,567

1,046

2,613

123

2017, 2018, 2020, 2023

2017

34

Nebraska

(d)

2,473

120

2,593

5

5

2,473

125

2,598

26

2022, 2023

2022

12

Nebraska

(c)

2,539

78

2,617

(23)

(23)

2,539

55

2,594

21

2016

2015

20

Arkansas

(b)

2,153

165

2,318

97

162

259

2,250

327

2,577

137

2014, 2015, 2016, 2017, 2023

2014

26

Illinois

(o)

2,547

2,547

2,547

2,547

2016

Colorado

(b)

1,995

84

2,079

466

466

1,995

550

2,545

216

2015, 2016, 2017, 2018

2015

17

Illinois

(i)

2,525

2,525

2,525

2,525

2017

California

(q)

967

1,357

2,324

175

175

967

1,532

2,499

443

2017, 2018

2017

28

Arkansas

(p)

2,358

82

2,440

4

4

2,358

86

2,444

28

2014, 2015

2014

27

Illinois

(d)

2,416

22

2,438

2,416

22

2,438

2

2022

2022

20

Illinois

(o)

2,428

2,428

2,428

2,428

2016

Illinois

(e)

2,406

2,406

2,406

2,406

2016

Colorado

(p)

2,328

2,328

2,328

2,328

2014

Arkansas

(p)

2,316

2,316

3

3

2,316

3

2,319

2018

2014

40

Nebraska

(c)

2,316

126

2,442

(126)

(126)

2,316

2,316

2015

Illinois

2,028

28

2,056

225

225

2,028

253

2,281

38

2018

2016

40

Illinois

(o)

2,019

2,019

216

216

2,019

216

2,235

32

2016, 2019

2016

34

Illinois

(e)

2,104

2,104

98

98

2,104

98

2,202

17

2018

2016

40

North Carolina

(k)

2,177

2,177

2,177

2,177

2018

South Carolina

(k)

1,090

1,090

230

847

1,077

1,320

847

2,167

122

2018, 2019, 2021

2018

39

Illinois

(m)

2,128

34

2,162

2,128

34

2,162

5

2022

2022

7

Illinois

2,146

2,146

2,146

2,146

2023

Arkansas

(p)

2,006

96

2,102

31

31

2,006

127

2,133

52

2014, 2021

2014

24

Indiana

(n)

2,125

2,125

2,125

2,125

2022

Illinois

(d)

1,700

1,700

346

346

1,700

346

2,046

86

2013, 2017

2014

35

Illinois

2,041

2,041

2,041

2,041

2022

Colorado

(p)

1,810

210

2,020

21

21

1,810

231

2,041

170

2014, 2016, 2021

2014

15

Nebraska

(d)

1,986

36

2,022

1,986

36

2,022

11

2022

2022

5

Colorado

(g)

1,760

1,760

248

248

1,760

248

2,008

58

2017, 2023

2016

23

Illinois

(e)

1,999

1,999

1,999

1,999

2016

Illinois

(e)

1,877

105

1,982

1,877

105

1,982

33

2016

2016

25

Illinois

(e)

1,975

1,975

1,975

1,975

2016

Illinois

(e)

1,960

1,960

1,960

1,960

2016

Illinois

(e)

1,949

1,949

1,949

1,949

2016

Illinois

(g)

1,905

1,905

1,905

1,905

2016

Illinois

(e)

1,863

1,863

1,863

1,863

2016

F-43F-38

Table of Contents

Farmland Partners Inc.

Schedule III – Real Estate and Accumulated Depreciation (continued)

December 31, 20202023

($ In Thousands)

Initial Cost to Company

Cost Capitalized Subsequent to
Acquisition

Gross Amount at Which
Carried at Close of Period

Life on Which

Description

Encumbrances

Land

Improvements

Total

Improvements

Land
Improvements

Land

Improvements

Total

Accumulated
Depreciation

Date of
Construction

Date Acquired

Depreciation in
Latest Income
Statements is
Computed

Illinois

(h)

200

16

216

(16)

-

200

-

200

-

2011

-

Illinois

(o)

196

-

196

-

-

196

-

196

-

2018

-

Georgia

142

39

180

2

0

142

41

183

5

2017

2017

30

Illinois

(f)

179

-

179

-

1

180

-

180

-

2016

-

Illinois

(f)

153

-

153

20

-

153

20

173

1

2019

2016

40

Illinois

(f)

170

-

170

-

-

170

-

170

-

2016

-

Illinois

(f)

157

-

157

-

1

158

-

158

-

2016

-

Michigan

13

93

106

-

-

13

93

106

3

2020

2020

20

Michigan

3

80

83

-

-

3

80

83

2

2020

2020

20

Colorado

-

-

-

69

-

-

69

69

6

2017

2017

40

Illinois

35

-

35

-

-

35

-

35

-

2020

-

Illinois

34

86

120

(86)

-

34

-

34

(3)

2016

-

Colorado

-

-

-

-

-

-

-

-

-

2017

-

Adjustments

-

1,167

1,167

3,583

Other

(u)

44,280

1,969

46,249

1,057

578

44,858

3,026

47,885

357

Farmer Mac Bond #6

$ 13,827

Farmer Mac Bond #7

$ 11,160

Met Life Bond #1

$ 85,188

Met Life Bond #2

$ 16,000

Met Life Bond #3

$ 21,000

Met Life Bond #4

$ 15,685

Met Life Bond #5

$ 8,379

Met Life Bond #6

$ 27,158

Met Life Bond #7

$ 17,153

Met Life Bond #8

$ 44,000

Met Life Bond #9

$ 21,000

MetLife Bond #10

$ 53,277

Rutledge Credit Facility #1

$ 17,000

Rutledge Credit Facility #2

$ 25,000

Rutledge Credit Facility #3

$ 25,000

Rutledge Credit Facility #4

$ 15,000

Rutledge Credit Facility #5

$ 30,000

Rabo Agrifinance Note

$ 62,359

Totals

$ 508,186

$ 919,874

$ 110,260

$ 1,030,134

$ 40,110

$ 5,083

$ 924,957

$ 151,537

$ 1,076,488

$ 32,648

(b)is part of a collateral pool for the $13.8 million Farmer Mac Bond #6

(c)is part of a collateral pool for the $11.2 million Farmer Mac Bond #7

(f)is part of a collateral pool for the $85.2 million Met Life Bond #1

(g)is part of a collateral pool for the $16.0 million Met Life Bond #2

(h)is part of a collateral pool for the $21.0 million Met Life Bond #3

(i)is part of a collateral pool for the $15.7 million Met Life Bond #4

(j)is part of a collateral pool for the $8.4 million Met Life Bond #5

(k)is part of a collateral pool for the $27.2 million Met Life Bond #6

(l)is part of a collateral pool for the $17.2 million Met Life Bond #7

(m)is part of a collateral pool for the $44.0 million Met Life Bond #8

(o)is part of a collateral pool for the $17.0 million Rutledge Credit Facility 1

(p)is part of a collateral pool for the $25.0 million Rutledge Credit Facility 2

(q)is part of a collateral pool for the $25.0 million Rutledge Credit Facility 3

(r)is part of a collateral pool for the $15.0 million Rutledge Credit Facility 4

(s)is part of a collateral pool for the $30.0 million Rutledge Credit Facility 5

(t)is part of a collateral pool for the $62.4 million Agrifinance Note

(u)

Other category is comprised of 102 farms in 8 states that on an individual basis make up less than 5% of gross total land plus improvements as of December 31, 2020. Approximately $1,607 is part of a collateral pool for the $13,827 Farmer Mac Bond #6, $510 is part of a collateral pool for the $11,160 Farmer Mac Bond #7, $18,268 is part of a collateral pool for the $85,188 Met Life Bond #1, $6,400 is part of a collateral pool for the $21,000 Met Life Bond #3, $4,988 is part of a collateral pool for the $15,685 Met Life Bond #4, $1,588

Initial Cost to Company

Cost Capitalized Subsequent to
Acquisition

Gross Amount at Which
Carried at Close of Period

Life on Which Depreciation in
Latest Income

Description

Encumbrances

Land

Improvements

Total

Land

Improvements

Total

Land

Improvements

Total

Accumulated
Depreciation

Date of
Construction

Date Acquired

Statements is
Computed

Illinois

(e)

1,856

1,856

1,856

1,856

2016

Illinois

(q)

1,825

1,825

1,825

1,825

2018

Illinois

(d)

1,815

1,815

1,815

1,815

2022

Illinois

(o)

1,696

1,696

109

109

1,696

109

1,805

15

2017

2016

50

North Carolina

(l)

1,770

1,770

25

25

1,795

1,795

2015

Illinois

(o)

1,772

1,772

1,772

1,772

2016

Illinois

(d)

1,750

1,750

1,750

1,750

2014

Illinois

(q)

1,735

1,735

1,735

1,735

2017

Illinois

(e)

1,734

1,734

1,734

1,734

2016

Illinois

(o)

1,646

88

1,734

1,646

88

1,734

30

2016

2016

23

Illinois

(o)

1,721

1,721

1,721

1,721

2016

Nebraska

(p)

1,608

32

1,640

80

80

1,608

112

1,720

35

2014, 2015

2014

28

Illinois

(o)

1,617

94

1,711

1,617

94

1,711

32

2016

2016

23

South Carolina

(l)

1,303

225

1,528

175

175

1,303

400

1,703

88

2016, 2017, 2020, 2023

2016

34

Nebraska

(p)

1,637

46

1,683

9

9

1,637

55

1,692

15

2014, 2015

2014

31

Illinois

(e)

1,678

4

1,682

(4)

(4)

1,678

1,678

2016

Illinois

(d)

1,496

1,496

159

159

1,496

159

1,655

2023

2021

30

Illinois

(o)

1,526

1,526

126

126

1,526

126

1,652

17

2017

2016

50

Illinois

(o)

1,623

1,623

1,623

1,623

2016

Nebraska

(p)

1,539

1,539

70

70

1,539

70

1,609

16

2011, 2015

2014

45

Illinois

(o)

1,606

1,606

1,606

1,606

2016

South Carolina

(i)

1,032

170

1,202

13

389

402

1,045

559

1,604

105

2017, 2018, 2020, 2023

2017

25

Illinois

(e)

1,591

1,591

1,591

1,591

2016

Nebraska

(b)

1,244

69

1,313

269

269

1,244

338

1,582

81

2014, 2015

2014

22

Illinois

(p)

1,500

1,500

26

26

1,500

26

1,526

4

2015

2014

50

Illinois

(d)

1,423

60

1,483

38

38

1,423

98

1,521

68

2006

2014

35

Illinois

(o)

1,484

1,484

1,484

1,484

2016

Illinois

1,475

1,475

1,475

1,475

2022

Illinois

(q)

1,471

1,471

1,471

1,471

2018

Illinois

(o)

1,438

1,438

1,438

1,438

2016

Illinois

(d)

1,437

1,437

1,437

1,437

2021

Illinois

(l)

1,403

1,403

1,403

1,403

2019

Nebraska

(b)

1,100

28

1,128

243

243

1,100

271

1,371

44

2014, 2015, 2018

2014

29

Nebraska

(k)

1,149

1,149

202

202

1,149

202

1,351

35

2018

2018

33

Illinois

(e)

1,231

1,231

116

116

1,231

116

1,347

17

2018

2016

40

Illinois

(e)

1,322

1,322

1,322

1,322

2016

Illinois

1,321

1,321

1,321

1,321

2022

Illinois

(e)

1,132

35

1,167

103

103

1,132

138

1,270

9

2016, 2022

2016

30

Illinois

(p)

801

97

898

364

364

801

461

1,262

57

2006, 2016, 2023

2014

40

Illinois

(e)

1,261

1,261

1,261

1,261

2016

Illinois

(b)

1,120

1,120

138

138

1,120

138

1,258

22

2016

2014

50

Illinois

(e)

1,256

1,256

1,256

1,256

2016

Illinois

(o)

1,221

1,221

1,221

1,221

2016

Illinois

(p)

1,147

1,147

60

60

1,147

60

1,207

9

2016

2014

50

Illinois

(e)

1,173

1,173

1,173

1,173

2016

North Carolina

(k)

1,161

1,161

1,161

1,161

2018

Illinois

(e)

1,160

1,160

1,160

1,160

2016

Illinois

(e)

1,117

28

1,145

9

9

1,117

37

1,154

16

2016, 2018

2016

20

Nebraska

(d)

1,109

40

1,149

1,109

40

1,149

22

2012

2014

20

Illinois

(e)

1,077

1,077

70

70

1,077

70

1,147

10

2018

2016

40

Illinois

(e)

1,128

44

1,172

(37)

(37)

1,128

7

1,135

2

2016

2016

30

Illinois

(e)

1,121

1,121

1,121

1,121

2016

Colorado

(p)

1,030

170

1,200

(87)

(87)

1,030

83

1,113

16

2014, 2016, 2017, 2021

2014

24

Colorado

(p)

1,105

1,105

1,105

1,105

2014

Illinois

(e)

1,082

1,082

1,082

1,082

2016

Illinois

(o)

991

991

77

77

991

77

1,068

11

2018

2016

40

Illinois

(e)

1,060

1,060

1,060

1,060

2016

Illinois

(e)

997

997

58

58

997

58

1,055

8

2017

2016

50

F-44F-39

Table of Contents

Farmland Partners Inc.

Schedule III – Real Estate and Accumulated Depreciation (continued)

December 31, 20202023

($ In Thousands)

is part of a collateral pool for the $8,379 Met Life Bond #5, $1,182 is part of a collateral pool for the $17,153 Met Life Bond #7, $4,142 is part of a collateral pool for the $25,000 Rutledge Credit Facility 1, $5,203 is part of a collateral pool for the $62,359 Rabo Agrifinance Note, $2,028 is part of a collateral pool for the $21,000 Met Life Bond #9, and $603 is part of a collateral pool for the $53,277 Met Life Bond #10.

(v)is part of a collateral pool for the $21.0 million Met Life Bond #9

(w)is part of a collateral pool for the $53.3 million Met Life Bond #10

(x)all of the above properties listed in Schedule III are farms.

(y)The aggregate cost of land and depreciable property for federal income tax purposes was approximately $1.02 billion as of December 31, 2020.

Initial Cost to Company

Cost Capitalized Subsequent to
Acquisition

Gross Amount at Which
Carried at Close of Period

Life on Which Depreciation in
Latest Income

Description

Encumbrances

Land

Improvements

Total

Land

Improvements

Total

Land

Improvements

Total

Accumulated
Depreciation

Date of
Construction

Date Acquired

Statements is
Computed

Illinois

(e)

1,065

27

1,092

(44)

(44)

1,065

(17)

1,048

2016

Colorado

(l)

809

141

950

62

62

809

203

1,012

58

2015

2015

31

Illinois

(e)

1,007

1,007

1,007

1,007

2016

Florida

(d)

935

67

1,002

935

67

1,002

16

2021

2021

10

Illinois

(e)

952

40

992

952

40

992

10

2016

2016

32

Illinois

(e)

982

982

982

982

2016

Illinois

(e)

977

977

977

977

2016

Illinois

(e)

974

974

974

974

2016

Colorado

(d)

819

94

913

58

58

819

152

971

73

2010, 2014, 2017, 2018

2014

22

Illinois

(e)

970

970

970

970

2016

Illinois

(e)

846

846

112

112

846

112

958

11

2019

2016

40

Illinois

(d)

923

53

976

(29)

(29)

923

24

947

6

2011

2014

50

North Carolina

(l)

936

936

9

9

945

945

2015

Illinois

(e)

940

940

940

940

2016

Illinois

(e)

847

63

910

847

63

910

25

2016

2016

22

Illinois

878

33

911

878

33

911

4

2022

2022

13

Colorado

(p)

527

373

900

(2)

(2)

527

371

898

323

2014, 2016

2014

17

Illinois

(e)

881

881

4

4

881

4

885

1

2016

2016

20

Illinois

(l)

866

18

884

866

18

884

1

2020

2020

48

Illinois

(f)

815

815

60

60

815

60

875

8

2017

2015

50

Illinois

(e)

865

865

865

865

2016

Other

(r)

46,995

1,313

48,308

10

1,230

1,240

47,002

2,411

49,413

607

Totals

$ 864,178

$ 87,479

$ 951,657

$ 5,673

$ 32,857

$ 38,530

$ 869,848

$ 120,204

$ 990,052

$ 33,048

(b)

Properties denoted with (b) are part of a collateral pool for the $13.8 million Farmer Mac Bond #6 .

Farmer Mac Bond #6

$ 13,827

(c)

Properties denoted with (c) are part of a collateral pool for the $11.2 million Farmer Mac Bond #7.

Farmer Mac Bond #7

11,160

(d)

Properties denoted with (d) are part of a collateral pool for the $30.0 million Farmer Mac Facility.

Farmer Mac Facility

30,000

(e)

Properties denoted with (e) are part of a collateral pool for the $72.6 million MetLife Term Loan #1.

MetLife Term Loan #1

72,585

(f)

Properties denoted with (f) are part of a collateral pool for the $5.8 million MetLife Term Loan #4.

MetLife Term Loan #4

5,756

(g)

Properties denoted with (g) are part of a collateral pool for the $5.2 million MetLife Term Loan #5.

MetLife Term Loan #5

5,179

(h)

Properties denoted with (h) are part of a collateral pool for the $21.7 million MetLife Term Loan #6.

MetLife Term Loan #6

21,726

(i)

Properties denoted with (i) are part of a collateral pool for the $15.4 million MetLife Term Loan #7.

MetLife Term Loan #7

15,434

(j)

Properties denoted with (j) are part of a collateral pool for the $44.0 million MetLife Term Loan #8.

MetLife Term Loan #8

44,000

(k)

Properties denoted with (k) are part of a collateral pool for the $16.8 million MetLife Term Loan #9.

MetLife Term Loan #9

16,800

(l)

Properties denoted with (l) are part of a collateral pool for the $49.0 million MetLife Term Loan #10.

MetLife Term Loan #10

48,986

(m)

Properties denoted with (m) are part of a collateral pool for the $12.8 million MetLife Term Loan #11.

MetLife Term Loan #11

12,750

(n)

Properties denoted with (n) are part of a collateral pool for the $14.4 million MetLife Term Loan #12.

MetLife Term Loan #12

14,359

(o)

Properties denoted with (o) are part of a collateral pool for the $0.0 million MetLife Facility.

MetLife Facility

(p)

Properties denoted with (p) are part of a collateral pool for the $45.5 million Rabobank.

Rabobank

45,533

(q)

Properties denoted with (q) are part of a collateral pool for the $5.0 million Rutledge Facility.

Rutledge Facility

5,000

$ 363,095

(r)

Other category is comprised of 92 farms in 7 states that on an aggregate basis make up less than 5% of gross total land plus improvements as of December 31, 2023.

Approximately $3.3 million is part of the collateral pool for Farmer Mac Bond #6

Approximately $0.5 million is part of the collateral pool for Farmer Mac Bond #7

Approximately $7.6 million is part of the collateral pool for Farmer Mac Facility

Approximately $18.5 million is part of the collateral pool for MetLife Term Loan #1

Approximately $2.5 million is part of the collateral pool for MetLife Term Loan #4

Approximately $1.3 million is part of the collateral pool for MetLife Term Loan #5

Approximately $1.5 million is part of the collateral pool for MetLife Term Loan #7

Approximately $2.0 million is part of the collateral pool for MetLife Term Loan #9

Approximately $2.9 million is part of the collateral pool for MetLife Facility

Approximately $4.7 million is part of the collateral pool for Rabo Agrifinance Note

(s)

all of the above properties listed in Schedule III are farms.

(t)

The aggregate cost of land and depreciable property for federal income tax purposes was approximately $891.8 million as of December 31, 2023.

F-45F-40

Table of Contents

Farmland Partners Inc.

Schedule III – Real Estate and Accumulated Depreciation

Reconciliation of “Real Estate and Accumulated Depreciation”

(in thousands)

Farmland Partners Inc.

Schedule III – Real Estate and Accumulated Depreciation

Reconciliation of “Real Estate and Accumulated Depreciation”

(In Thousands)

Years ended December 31,

Years ended December 31,

2020

2019

2023

2022

Real Estate:

Balance at beginning of year

$

1,087,767

$

1,108,016

$

1,129,485

$

1,092,693

Additions during period

Additions through construction of improvements

5,316

5,326

10,424

729

Disposition of property and improvements

(18,069)

(62,468)

(165,335)

(23,387)

Acquisitions through business combinations and/or asset acquisitions

1,406

36,893

22,171

59,450

Impairment of assets

(6,693)

Balance at end of year

$

1,076,420

$

1,087,767

$

990,052

$

1,129,485

Accumulated Depreciation:

Balance at beginning of year

$

25,223

$

18,148

$

38,433

$

38,254

Disposition of improvements

(521)

(947)

(12,010)

(6,771)

Additions charged to costs and expenses

7,900

8,022

7,478

6,950

Impairment of assets

(853)

Balance at end of year

$

32,602

$

25,223

$

33,048

$

38,433

Real Estate balance per schedule

$

1,076,420

$

1,087,767

$

990,052

$

1,129,485

Construction in progress

9,283

11,911

4,453

14,810

Other non-real estate

71

71

109

68

Balance per consolidated balance sheet

$

1,085,774

$

1,099,749

$

994,614

$

1,144,363

Accumulated depreciation per schedule

$

32,602

$

25,223

$

33,048

$

38,433

Other non-real estate

52

54

35

14

Balance per consolidated balance sheet

$

32,654

$

25,277

$

33,083

$

38,447

F-46F-41