In addition, it appears that the advances are given against a future undertaking in an agreement for the delivery of tobacco (P/18, at p. 1716 of the appendices):
"Crop advances to leaf tobacco farmers are generally secured by the farmers’ agreement to deliver green tobacco."
- Eden's statements in his interrogation indicate that there is a material difference between Universal's business and accounting model and that of Agrexco, especially with regard to the lack of legal rights to repay advances and the absence of binding agreements with Agrexco's growers (Minutes, p. 765, s. 15 to p. 766, s. 18):
"Q: All of these things are different from Agrexco.
A: Yes, but the main thing is, what happens when the harvest received from the supplier is not enough to repay the loan. And then what I wrote in paragraph 7.8 of my opinion, in years when the harvest received from the supplier is insufficient, there is no refund to the company. In other words, the company doesn't owe money, doesn't pay it back, but credits it for years to come. Every year, an examination is carried out for the impairment of the advances, taking into account the forecast of future growth and the company's past experience. The loss from impairment is recorded as an expense in the income and loss statement. In other words, here too it's kind of nonrecourse.
Q: Sir, you have confirmed to me that all the things I have said are true. Then you added all sorts of distinctions, as to whether it's other things. But all the things I said, the differences between the situation between Universal and Agrexco, you don't retract it. They do exist, all the differences I have listed, I say them again. that Universal gave advances in the form of agricultural equipment and materials. Is that correct?
A: That's right.
Q: Universal has legal rights in connection with the refund. Is that correct?
A: Subject to the limitation that if the rights are only from the crop,