AGRIBUSINESS VALUATION REPORT

Transcription

1 AGRIBUSINESS VALUATION REPORT "Yarranlea Farms" 424 Warroo Road Lake Cowal, NSW 2671 Duxton Broadacre Farms Limited Date of Valuation: 25 October 2017 CBRERef: Version: E W MS16

2 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Subject Property Source: CBRE Earth CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 2

3 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 CONTENTS 1 Executive Summary 4 2 Valuation Synopsis Brief Description Reliance & Liability Market Value Definitions Transaction History Marketability Critical Assumptions Recommendations 8 3 Location 9 4 Title Details Real Property Description (Freehold) Land Identification Encumbrances & Registered Interests Title Disclaimers 12 5 Site Description Land Area & Dimensions Shape & Topography Services & Amenities Flooding Site Contamination Pests, Weeds & Diseases 14 6 Planning Current Planning Controls 16 7 Water Details Water Entitlement Water Delivery Summary Water Entitlement Water Supply & Delivery Inspection Photos 19 8 Climatic Details Climate Classification Climatic Analysis 8.3 Recent Rainfall History Land Use Capacity Enterprise Activities 9.2 Inspection Photos Structures Overview Measurement of Areas Dwellings Inspection Photos Rural Structures Asbestos Market Commentary Agribusiness Overview Water Market Subject Market Sales Evidence Introduction Distribution of Comparable Sales Sales Evidence Valuation Methodology Introduction Direct Comparison Approach Valuation Summary Treatment of GST Qualifications 47 Appendices Copy of Letter of Engagement 49 Contract of Sale 63 CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 3

4 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 INSTRUCTIONS / RELIANCE Instructing Party Instruction Date Reference Reliant Party/Purpose Interest Valued Mr Stephen Duerden (Director), Duxton Broadacre Farms Limited. 20 October CBRE Valuations Pty Limited ( CBRE ) accepted instructions dated 20 October 2017 to prepare a Fair Value Valuation for the interest in the property (and associated water entitlements) described herin. The Valuation is to be relied upon for Prospectus purposes only and is specifically addressed for use and reliance upon by the parties named above. The Valuation is prepared in accordance with the Australian Property Institute Australia and New Zealand Valuation and Property Standards January 2012, having regard to ANZVGN 8, Valuations for use in Offer Documents. Duxton Broadacre Farms Limited for Initial Public Offering purposes only. Freehold (100%). PROPERTY PARTICULARS Asset Description Title Details Registered Owner Land Area "Yarranlea Farms" is utilised to support irrigated cropping and dryland cropping/grazing enterprises. Refer to body of report for details. Multiple Titles - refer to body of report. Bede Vaughan Tooth. 2, hectares. ASSESSMENT Valuation Approaches Direct Comparison Summation Date of Inspection 25 October 2017 Date of Valuation 25 October 2017 ADOPTED VALUE Fair Value $7,435,000 (Seven Million, Four Hundred and Thirty Five Thousand Dollars) This valuation is exclusive of GST. Principal Valuer e-sig Tom Burchell Certified Practising Valuer Director - Agribusiness Property Inspection - Yes Co-Signatory * e-sig Tim McKinnon Senior Director - Agribusiness Property Inspection - No Job Involvement - Co-Signatory in capacity of Director * The Co-Signing Director/Peer or Quality Assurance Reviewer confirms having reviewed the valuation methodology and calculations, however the opinion of the value expressed has been arrived at by the Principal Valuer alone/principal Valuers jointly. Conditional Terms This summary must not be read independently of the valuation report in its entirety. This valuation is subject to all content, assumptions, disclaimers, qualifications and recommendations throughout the report. The report is prepared for the use of and reliance by the Reliant Party only and limited only to the Purpose specifically stated. No responsibility is accepted or assumed to any third party for the whole or any part of the report. Liability limited by a scheme approved under Professional Standards Legislation. CBRE Valuations Pty Limited ABN Valuation & Advisory Services Level 34, 8 Exhibition Street Melbourne VIC 3000 T F CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 4

5 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Brief Description Yarranlea Farms is a mixed irrigated and dryland cropping/grazing holding situated at Lake Cowal in the Central West region of New South Wales. The property includes approximately 2,184 hectares of land with 350 hectares developed to irrigation flood (row crop) and 1,604 hectares of dryland cropping / grazing land. The balance of land, approximately 230 hectares, comprises remnant vegetation and timbered grazing land. The irrigation land is supported by access to approximately 1,342 megalitres of Jemalong Irrigation Limited General Security water. Structures include a main dwelling & surrounds, dated cottage and rural infrastructure. Liability Liability limited by a scheme approved under Professional Standards Legislation. (a) CBRE is not operating under an Australian Financial Services Licence when providing the full Valuation Report and those documents do not constitute financial product advice. Investors should consider obtaining independent advice from their financial advisor before making any decision to invest in/with Duxton Broadacre Farms Limited. (b) CBRE disclaims any liability to any person in the event of an omission from, or false and misleading statements included in the Prospectus, other than in respect to this full Valuation Report. (c) The Valuation Report is strictly limited to the matters contained within those documents, and are not to be read as extending, by implication or otherwise, to any other matter in the Prospectus. Without limitation to the above, no liability is accepted for any loss, harm, cost or damage (including special, consequential or economic harm or loss) suffered as a consequence of fluctuations in the market subsequent to the date of valuation. (d) CBRE has prepared the full Valuation Report relying on and referring to information provided by third parties in including financial and market information ( Information ). CBRE assumes that the Information is accurate, reliable and complete and it has not tested the information in that respect. (e) No responsibility is accepted for any loss or damage arising as a result of reliance upon this Valuation Report. (f) CBRE charges a professional fee for producing valuation reports, and the fee paid by Duxton Broadacre Farms Limited for the Valuation Report was $19,250 inclusive of GST. (g) We confirm that the valuers do not have a pecuniary interest that would conflict with a proper valuation of the interest in the property. (h) This document is for the sole use of persons directly provided with it by CBRE. Use by, or reliance upon this document by anyone other than those parties named above is not authorised by CBRE and CBRE is not liable for any loss arising from such unauthorised use or reliance. Reliance This valuation is strictly and only for the use of the Reliant Party and for the Purpose specifically stated in the Instructions section. Confidentiality This valuation report is strictly confidential between CBRE and the Reliant Party, however any such party may disclose all or part of this valuation report without the other parties consent where: (a) it is required to do so by law or the listing rules of a recognised stock exchange; (b) it is required to do so by a court, arbitrator or administrative tribunal in the course of proceedings or any determination to which the disclosing party is a party; or (c) which, in the reasonable opinion of the disclosing party, is required to be disclosed to any prospective lender, insurer or other consultant or professional adviser, provided that in each case it first obtains (and enforces if required by either of the other parties), an undertaking from each such person to keep this valuation in strict confidence. Transmission Only an original valuation report received by the Reliant Party directly from CBRE or through a Panel Management System authorised by the client can be relied upon. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 5

6 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Restricted No responsibility is accepted or assumed to any third party who may use or rely on the whole or any part of the content of this valuation. Copyright As between CBRE, the Instructing Party and the Reliant Party, all intellectual property rights in this valuation report are owned by CBRE. Neither the whole nor any part of the content of this valuation may be published in any document, statement, circular or otherwise by any party other than CBRE, nor in any communication with any third party, without the prior written approval from CBRE, and subject to any conditions determined by CBRE, including the form and context in which it is to appear. Value Subject To Change This valuation is current as at the date of valuation only. The value assessed herein may change significantly and unexpectedly over a relatively short period (including as a result of general market movement or factors specific to the particular property). For the avoidance of doubt, this may include global financial crises or force majeure events. We do not accept liability for losses arising from such subsequent changes in value. Reliance Period We do not assume any responsibility or accept any liability in circumstances where this valuation is relied upon after the expiration of 90 days from the date of valuation, or such earlier date if the Reliant Party becomes aware of any factors that have any effect on the valuation. Disclosure CBRE must be advised in the event that the Reliant Party becomes aware of any changes relating to the information and advice provided by the Instructing/Reliant Party during the Reliance Period. This includes, without limitation, any changes to information and advice provided in relation to encumbrances, registered/unregistered interests, title, and land area/dimensions. In any such event, this valuation must not be relied upon without consulting CBRE first to reassess any effect on the valuation. Valuer s Interest We hereby certify that the Principal Valuer is suitably qualified and authorised to practise as a valuer; does not have a pecuniary interest, financial or otherwise, that could conflict with the proper valuation of the property; and accepts instructions to value the property only from the Responsible Entity/Instructing Party. AASB13 Fair Value Measurement We have also had regard to the requirements of the Australian Accounting Standards Board. In particular, we have considered AASB13 Fair Value Measurement, which adopts the following definition of Fair Value: Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. The fair value of a non-financial asset is based on its highest and best use to market participants. Highest & Best Use In accordance with the Australian Property Institute Valuation and Property Standards, the definition of highest and best use is: The most probable use of a property which is physically possible, appropriately justified, legally permissible, financially feasible, and which results in the highest value of the property being valued. Highest & Best Use Comment When determining the highest and best use, there are a number of factors which must be considered including: Existing use. Profitability and marketability. Financial and social constraints. Legal constraints and regulatory controls. Physical and functional limitations. Zoning provisions. The highest and best use of "Yarranlea Farms" is deemed to be the current use as an irrigated and dryland cropping/grazing enterprise. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 6

7 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Contract of Sale We understand the property is under contract for $7,435,000, dated 2 August 2017 (100% ownership interest). We understand that as part of the terms, the construction of the circa 688 megalitre turkeys nest irrigation dam and 12 megalitre surge area had to be completed prior to settlement. At the date of our inspection date the turkeys nest irrigation dam and surge area had been completed and were in operation. If any of the above is deemed incorrect, we reserve the right to review this valuation. Previous Sale According to our enquiries the property has not sold within the last 3 years. Buyer Demand/ Purchaser Profile In the current market: Anticipated buyer demand/liquidity: strong. Likely purchaser profile comprises: institutions, owner operators, private investors, syndicates. Estimated selling period (with a professional marketing campaign) is: 3-6 months. Our valuation is subject to the following critical assumptions: Title The land is not subject to any encroachments or restrictions on title. Identification All structures have been erected within the title boundaries of the site and there are no encroachments on or by the subject land. We note that in regard to rural properties, it is common for fencing to encroach either way between boundaries. Given that it is not practical to verify the status of boundaries due to the sheer size and scale of rural properties, we assume there to be no impact on productivity, marketability, or value. Roads The property is unaffected by any road alteration proposals. Approvals/Permits All Council approvals and permits have been obtained for the existing development. Accuracy of Information In assessing this valuation, we have been provided with information by the reliant party. We advise that any objective information, data or calculations set out in the Valuation will be accurate so far as is reasonably expected from a qualified and experienced valuer, reflecting due skill, care and diligence. However, we have not independently verified third party information, adopted it as our own, or accepted its reliability. If any of the information provided by others and referred to in the valuation report is incorrect, it may have an impact on the valuation. The valuation is provided on the proviso that the reliant party accepts this risk. Land Class Apportionment In an effort to apportion the correct land classes across the aggregation, we have relied upon information provided by the reliant party in obtaining the appropriate areas. We have reconciled the areas provided by reliant party via Google Earth Pro Mapping Software where possible. If any of the information is found to be incorrect, we reserve the right to review the valuation. Market Movement This valuation is current as at the date of valuation only. The value assessed herein may change significantly and unexpectedly over a relatively short period (including as a result of general market movements or factors specific to the particular water entitlement). We do not accept liability for losses arising from such subsequent changes in value. Without limiting the generality of the above comment, we do not assume any responsibility or accept any liability where this valuation is relied upon after the expiration of 90 days from the date of the valuation, or such earlier date if you become aware of any factors that have any effect on the valuation. However, it should be recognised that the 90 day reliance period does not guarantee the value for that period; it always remains a valuation at the date of valuation only. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 7

8 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Water Entitlements: We have assumed that the water entitlements are utilised on the property and form part of the farm enterprise, notwithstanding that they are the personal property of the owner and are not part of the real property. In the event that the water entitlements do not form part of the farm enterprise, this valuation must not be relied upon before first consulting CBRE to reassess any effect on the valuation. Irrigation Infrastructure: Via information obtained and through our property inspection, we have been advised that the irrigation infrastructure is in adequate working order. Therefore for the purpose of this valuation we have assumed that all pumps and irrigation infrastructure are in sound working order. All irrigation equipment including irrigators and pumps are included in the valuation and capitalised into the associated land value. Moora Plains Water Scheme We have been advised that the property has access to Stock and Domestic water from the Moora Plains Water Scheme, which provides water to the property from a bore on a neighbouring farm. We have requested but not been provided with any further information. We reserve the right to review the valuation if any of the above is deemed incorrect. Lease We have been advised that portion of the property is currently leased to a local operator which is due to terminate on 31 December We have been advised to disregard the lease as part of our instructions. Caveats As at the search date, the following caveats are noted on Title: Caveat by New South Wales Rural Assistance Authority via instrument number AD Caveat by New South Wales Rural Assistance Authority via instrument number AJ Caveat by New South Wales Rural Assistance Authority via instrument number AB (caveat consented via instrument numbers AC and AD484711). We understand that these caveats were all associated with the previous owner and as a result do not affect the current ownership. We have therefore disregarded these caveats for the purpose of this valuation. Prior to relying on the report, the Reliant Party is to obtain the following information/additional advice: Moora Plains Water Scheme We have not sighted a formal agreement for the Moora Plains Water Scheme allowing access to the property to legally be upheld. We recommend that such agreement be provided or if not in place created via an easement. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 8

9 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Regional Centre Forbes. Locality Located approximately 48 radial kilometres south-west of Forbes, 50 radial kilometres north-east of West Wyalong and approximately 340 radial kilometres west of the Sydney Central Business District. Regional Services Forbes provides Supermarket and a regional shopping strip. Primary and secondary schools. Public hospital and medical centre. West Wyalong provides Supermarket and a regional shopping strip. Primary and secondary schools. Public hospital and medical centre. Sydney provides Extensive retail facilities including large shopping centres. Public, private and specialist hospitals. Extensive education facilities to a tertiary level. The nearest major grain receival site to the property is located at Forbes. Livestock sale yards are also situated at Forbes. Surrounds Predominately dryland or irrigated cropping / grazing properties. The south-western boundary of the property adjoins Lake Cowal. Transport/Roads Accessible by road only. Regional Map Source: Google Maps The property is located in proximity to the Newell Highway, one of New South Wales major arterial linkages. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 9

10 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Local Imagery Source: CBRE Earth CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 10

11 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 TITLE RECONCILIATION Volume/Folio Lot/Plan Registered Owner Total Hectares 102/ Lot 102 in DP Bede Vaughan Tooth / Lot 103 in DP Bede Vaughan Tooth / Lot 104 in DP Bede Vaughan Tooth / Lot 37 in DP Bede Vaughan Tooth / Lot 38 in DP Bede Vaughan Tooth / Lot 73 in DP Bede Vaughan Tooth / Lot 12 in DP Bede Vaughan Tooth Total 2, Search Date: 12-Jul-2017 Provided By: Reliant Party Verification Source The property has been identified by reference to the Deposited Plans and on-site inspection. The structures appear to be erected within the title boundaries of the site and there do not appear to be any encroachments on or by the subject land. We note however, we are not experts in this field and that actual identification of title boundaries, encroachments and confirmation that structures are contained within those boundaries would necessitate a check survey be undertaken by a qualified land surveyor. Dealings (Individual Titles) Interests registered on Titles (excluding liens) are summarised as follows: Volume 102 Folio Mortgage to Rabobank Australia Limited via instrument number AA Caveat by New South Wales Rural Assistance Authority via instrument number AD Caveat by New South Wales Rural Assistance Authority via instrument number AJ Volume 103 Folio Lease to Banridge Pty Limited via instrument number AD which expires 31 December Volume 104 Folio Mortgage to Rabobank Australia Limited via instrument number AA Caveat by New South Wales Rural Assistance Authority via instrument number AD Caveat by New South Wales Rural Assistance Authority via instrument number AJ Volume 37 Folio Mortgage to Rabobank Australia Limited via instrument number AC Caveat by New South Wales Rural Assistance Authority via instrument number AB (caveat consented via instrument numbers AC and AD484711). Volume 38 Folio Mortgage to Rabobank Australia Limited via instrument number AC Caveat by New South Wales Rural Assistance Authority via instrument number AB (caveat consented via instrument numbers AC and AD484711). Volume 73 Folio Mortgage to Rabobank Australia Limited via instrument number AC Caveat by New South Wales Rural Assistance Authority via instrument number AB (caveat consented via instrument numbers AC and AD484711). Volume 12 Folio Mortgage to Rabobank Australia Limited via instrument number AC CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 11

12 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Caveat by New South Wales Rural Assistance Authority via instrument number AB (caveat consented via instrument numbers AC and AD484711). Full details are provided in the Certificate of Title (refer to Appendices). Caveats As at the search date, the following caveats are noted on Title: Caveat by New South Wales Rural Assistance Authority via instrument number AD Caveat by New South Wales Rural Assistance Authority via instrument number AJ Caveat by New South Wales Rural Assistance Authority via instrument number AB (caveat consented via instrument numbers AC and AD484711). We understand that these caveats were all associated with the previous owner and as a result do not affect the current ownership. We have therefore disregarded these caveats for the purpose of this valuation. Liens Title/Unregistered Interests We have disregarded the presence of any mortgage or other financial liens pertaining to the property. Our valuation is on an unencumbered basis and therefore assumes the mortgage/s to be released on sale/transfer of title. We have assumed that there are no further easements, unregistered interests or encumbrances not disclosed by this brief title search which may affect market value. However, in the event that a future title search is undertaken which reveals additional easements or encumbrances, CBRE should be consulted to reassess any effect on the value stated herein. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 12

13 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Land Area 2, hectares (derived from Deposited Plans). Road Frontage Warroo Road (gravel): 5.0 kilometres West Plains Road (gravel): 2.6 kilometres Edols Road (gravel): 1.2 kilometres Access Primary access is available from Warroo Road which fronts the north-western boundary of the property. Site Survey We do not commission site surveys and a site survey has not been provided to us. We have assumed there are no encroachments by or on the property, and the Reliant Party should confirm this status by obtaining a current survey report and/or advice from a registered surveyor. Shape Irregular. Topography & Vegetation Yarranlea Farms is relatively level throughout. The highest areas of elevation are situated to the elevated timber ridgeline to the south-eastern portion of the property. We note that some areas of the farm are considered low lying, with a levee bank protecting the south-western side of the property from high rainfall events and flooding from Lake Cowal. The property has been predominately cleared of remnant vegetation with the exception of a large native timber stand to the centre and some scattered native shade trees. Soil Type Source: Information Provided and Property Inspection The soil types on Yarranlea Farms can be described as grey self-mulching clay soils to the southern portion that are well regarded for cropping. The northern portions of the holding generally include mixed red and grey loam soil types. Land Use & Development The various land uses are summarised as follows: Land Uses Approximate Area Proportion Irrigation - Flood (Row Crop) ha 16% Dryland Cropping / Grazing 1, ha 73% Remnant Vegetation / Timbered Grazing ha 11% Total: 2, ha 100%* * Total may not equal 100% due to rounding. Source: Farm Manager, Property Inspection and CBRE Earth Fencing/Farm Layout Yarranlea Farms includes a significant laneway system which facilitates vehicular and livestock movement to the majority of the property s 15 paddocks. Fencing is of mixed agricultural construction and considered to be in sound stock proof condition. Large sections of fencing has been replaced in recent years with steel posts and ringlock wires. Erosion None sighted on inspection. Drainage Natural and engineered. Typical Services Electricity: Connected. Reticulated Water: (Refer to Water Supply & Delivery). Sewerage: Septic tank system only. Gas: Bottled only. Telephone: Connected. Mobile Phone Coverage: Reliable. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 13

14 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Investigations We have reviewed Planning Scheme Maps and no flood records were found. However, the property is relatively level in topography and situated directly to the east of Lake Cowal so may be subject to flood events. The last major flood event occurred in 2016 which was in-line with large parts of the region. While we note that these flood events can have adverse effects on crop production, they occur irregularly (approximately 1 in 10/20 years) and as such would not appear to be a major detriment to saleability given recent transactions of nearby similarly affected properties rates being well aligned to the market. As previously mentioned we note the existence of a flood protection levee bank to large portions of the south-western boundary. Formal searches have not been undertaken. Flooding Caution The quality, completeness and accuracy of flood mapping varies widely between localities and Councils. We have not verified, and make no representation as to the appropriateness, accuracy, reliability or currency of the flood mapping reviewed. The Reliant Party may wish to confirm the flood mapping information by obtaining an expert hydrologist s report. If further flooding data is obtained, we reserve the right to review and if necessary amend the valuation. Past Use The past use of the property was as a mixed irrigation and dryland/cropping enterprise. We do not undertake historical site searches, and have therefore assumed former uses did not cause site contamination unless these have been identified in the following section. Past Use Comment Residual chemical contamination is unlikely in this district. While public authorities may have used organochlorines for wood treatment and termite control along transmission lines, the historic district land use does not lead us to suspect such contamination. Present Use The present use of the property is as a mixed irrigation and dryland/cropping enterprise. Informal Contamination Comment (site inspection) It is not uncommon for rural properties to have the possibility of localised contamination, be that the storage of on-farm chemicals, fuel tanks, or the presence of a livestock dip. This is considered not to have a material effect on value. Salinity We have assumed no direct existing or potential threat from salinity. Surrounding Properties Our visual inspection of the surrounding properties revealed no obvious signs of potentially contaminating uses. Our valuation assumes no contamination issues associated with adjoining properties. We Are Not Contamination Experts Site Conditions Unless otherwise stated, we have assumed that the site is free of subsoil asbestos or any elevated levels of contaminants. We have made no allowance in our valuation for site remediation works. Our visual inspection is an inconclusive indicator of the actual condition of the site. We make no representation as to the actual environmental status of the subject property. If any testing is undertaken to assess the degree, if any, of contamination of the site and this is found to be positive, this valuation must not be relied upon before first consulting CBRE to reassess any effect on the valuation. We do not commission site investigations to determine the suitability of ground conditions and services, nor do we undertake environmental or geotechnical surveys. We have assumed that these aspects are satisfactory and also that the site is clear of underground mineral or other workings, methane gas or other noxious substances. If there is any variation in groundwater levels or recharge and discharge zones that could detrimentally affect the property, this valuation must not be relied upon before first consulting CBRE to reassess any effect on the valuation. Pests/Vermin None noted during inspection that would impact on value. Noxious Weeds None noted during inspection that would impact on value. Johne s Disease This is a bacterial disease which inhibits an animal s ability to absorb nutrients through the intestinal wall. The bacteria can be spread through the environment, manure, feed, water and milk. The disease primarily transfers to cattle and sheep when they are less than 12 months of age. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 14

15 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 All of NSW is now regarded as a Beef Protected Area (BPA) under the Stock Diseases Act All quarantines have been lifted from infected dairy holdings; all stock can be traded within NSW, with it up to the buyer to make a risk assessment based on the Dairy Score before introducing such stock to their herd. There are no movement restrictions into or within NSW on account of OJD. All sheep entering NSW must be accompanied by a completed National Sheep Health Statement which is required as a vendor declaration for footrot. We have assumed that the property is not affected. We assume the property is free of all other notifiable diseases. If the presence of any other notifiable disease is detected, this valuation must not be relied upon before first consulting CBRE to reassess any effect on the valuation. Disease We assume the property is free of all other notifiable diseases. If the presence of any other notifiable disease is detected, this valuation must not be relied upon before first consulting CBRE to reassess any effect on the valuation. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 15

16 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Local Authority Forbes Shire Council. Local Plan Forbes Local Environmental Plan Zoning Primary Production (RU1). Overlays Terrestrial Biodiversity. Wetlands. Groundwater Vulnerability. Minimum Subdivision Area hectares. Permitted Use The current use as a mixed irrigated and dryland cropping/grazing property conforms to the permitted use of the site under the current zoning Primary Production (RU1). Heritage The property is not expected to be subject to Heritage issues. Searches were not undertaken. Native Title The property is not expected to be subject to Native Title issues. Searches were not undertaken. Planning Information We assume information provided by the relevant responsible authority is current and accurate. We do not commission formal investigations to verify information provided to us. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 16

17 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Water Entitlement Associated with "Yarranlea Farms" is access to the following water entitlements: Jemalong Irrigation Limited - General Security Authorised Holder Bede Vaughan Tooth Irrigation Corporation Jemalong Irrigation Limited Category General Security Certificate No. Ml Total Megalitres Jemalong Irrigation Limited - General Security Authorised Holder Banridge Pty Ltd Irrigation Corporation Jemalong Irrigation Limited Category General Security Certificate No. Ml Total Megalitres 1, Delivery Entitlements and Shares We have been advised that associated with Yarranlea Farms are the following water Delivery Entitlements and Shares associated with the above Water Certificates. 8 Shares and 8 Delivery Entitlements facilitated via Jemalong Irrigation Limited registered under Certificate Shares and 8 Delivery Entitlements facilitated via Jemalong Irrigation Limited registered under Certificate Shares and 435 Delivery Entitlements facilitated via Jemalong Irrigation Limited registered under Certificate Shares and 660 Delivery Entitlements facilitated via Jemalong Irrigation Limited registered under Certificate Shares and 192 Delivery Entitlements facilitated via Jemalong Irrigation Limited registered under Certificate Shares and 0 Delivery Entitlements facilitated via Jemalong Irrigation Limited registered under Certificate 425. We enclose copies of the Water Certificates refer to Appendices. We have assumed that the water entitlements are utilised on the property and form part of the farm enterprise, notwithstanding that they are the personal property of the holder and are not part of the real property. In the event that the water entitlement does not form part of the farm enterprise, this valuation must not be relied upon before first consulting CBRE to reassess any effect on the valuation. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 17

18 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Domestic Supply: Catchment tank. Delivery System: Pressure pump. Livestock Supply: Moora Plains Water Scheme, which provides water to the property from a bore on a neighbouring farm. Water is then reticulated around the property to concrete troughs in each main paddock. Catchment dams. Irrigation Supply: Surface water is sourced from the Jemalong Irrigation Scheme which is via the Lachlan Regulated River. The main supply channel, known as Jemalong No 2 Channel, is situated to the south-eastern portion of the property. Water is also available to the northern portion of the property via the Jemalong Channel, however this is not currently in use. We understand that due to the location of the property in relation to Lake Cowal that there exists an opportunity to harvest overland flow water in high rainfall events. There is no irrigation groundwater on the property. Design & Layout: The property features approximately 350 hectares of developed irrigated row cropping land that is benefited by a recently constructed circa 688 meglitre turkeys nest storage dam and associated 12 meglitre surge area. Irrigation water is transferred into/out of the main storage via: Cummins diesel 132 kw engine coupled to a China pump which has recently been installed and is therefore in a sound condition. We have been advised that the pump has a capacity of circa 60 megalitres per day. A smaller lift pump powered by a diesel motor is situated to the southern portion of the property and has a capacity of approximately 30 megalitres per day. A network of open air channels facilitates the transfer of water throughout the property. Irrigation water is then released to the land by through the bank pipes. The irrigation layout is also benefited by a tail water return system. Water Quality: The water quality associated with the Lachlan River is assumed to be adequate for irrigation purposes. Irrigation Water Use Summary We have requested but not been provided with historical water use pertaining to the property, therefore we have been unable to comment on historical water use. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 18

19 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Aspect over newly installed China pump Aspect over lift pump to the southern portion of the property Circa 688 megalitre turkey s nest storage dam Circa 12 megalitre surge area Through the bank pipe delivery system Concrete stock trough CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 19

20 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Source: Bureau of Meteorology, Commonwealth of Australia Overview The map below depicts the various Climate Classifications of Australia, based on a modified Köppen classification system (Commonwealth of Australia 2005). The Köppen classification map shows 6 major groups and 27 sub-groups of climate zones across Australia. These climate zones are defined with the climatic limits of native vegetation in mind. This method of classification is based on the concept that native vegetation is the best expression of climate in an area. The 6 major classes are identified predominantly on native vegetation type, with the additional sub-groups taking into consideration seasonal distribution of temperature and precipitation. Classification The location is classified as Temperate - no dry season (hot summer). Temperature & Rainfall Overview The Bureau of Meteorology weather station at Burcher Post Office has recorded an average rainfall of 470 mm per annum from 1937 to The chart overleaf depicts the temperature and rainfall characteristics of the locality. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 20

21 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Average Monthly Rainfall mm mm mm mm mm 75.0 mm 50.0 mm 25.0 mm 0.0 mm Climatic Analysis Average Temperature (Min/Max) Average Rainfall Median Rainfall Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Average Monthly Temperature Year Rainfall History In order to provide an indication of recent rainfall history for the locality, we have plotted the actual annual rainfall over the past 10 years against the corresponding long term annual average. Recent Annual Rainfall Monthly Rainfall 1,000.0 mm Actual Rainfall - Annual Average Rainfall - Annual mm mm mm mm 0.0 mm Seasonal Conditions As demonstrated above, the locality has experienced at or near (within 10%) of the average annual rainfall in 7 of the past 10 years. More recently, rainfall in the 2017 calendar year to the end of September equates to 60% of the average annual rainfall. The below average rainfall is consistent with large areas of New South Wales which has experienced dry Winter and Spring months. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 21

22 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Current Enterprises Yarranlea Farms is a mixed irrigated and dryland cropping/grazing holding situated at Lake Cowal in the Central West region of New South Wales. The property includes approximately 2,184 hectares of land with 350 hectares developed to irrigated row cropping and 1,604 hectares of dryland cropping / grazing land. The balance of land, approximately 230 hectares, comprises remnant vegetation and timbered grazing land. At the date of sale, the irrigation land was being utilised for cotton production and the dryland was being utilised for both cropping (cereals and canola) and grazing (both sheep and cattle). Yields We have not been supplied with historical cropping yields, however have been advised of the following typical yields: Cotton: Circa 11 to 14 bales per hectare. Cereals: Circa 2.5 to 4 tonnes per hectare. Oilseed: Circa 1 to 2 tonnes per hectare. We understand that the cotton grown in the region typically utilises between 10 megalitres to 12 megalitres per hectare of irrigation water (season dependent). Fertiliser Application History Farm Map Provided by reliant party We have not been supplied with the fertiliser application history; however understand that the majority of the land planted to crop has adequate levels of nitrogen and superphosphate fertiliser applied on an annual basis. The farm map provided overleaf denotes the layout of the property CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 22

23 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 23

24 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Aspect over irrigation land planted to cotton Aspect over irrigation land Aspect over water supply channel Aspect over dryland wheat on heavier self mulching soil types Dryland canola Cereal crop to mixed soil types CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 24

25 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Internal laneway system Sheep grazing CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 25

26 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Overview Our comments are summarised below and are based on our inspection of reasonable accessible portions of the property. Structure & Facilities Inclusions & Exclusions We do not commission Structural Surveys and a Structural Survey has not been provided to us. We have not tested any of the services or facilities, nor inspected unexposed or inaccessible portions of the building/s, and are therefore unable to state that these are free from defect, rot or infestation. We assume the property complies with all relevant statutory requirements in respect to health, building, and fire safety regulations. Our valuation includes those items that forms part of the building service installations such as heating and cooling equipment, sprinklers, lighting, etc., that would normally pass with the sale of the property, but excludes all items of plant, machinery, equipment, partitions, furniture and other such items which may have been installed (by the occupant/operator) or are used in connection with the enterprise carried on within the property. Measurement of Areas Areas of all classes of structures/buildings are calculated from measurement to the outer perimeter of external construction features (on site, or in combination with plans/information provided). This is undertaken given combined consideration of the nature of the occupation or primary use for what the item is designed and the use for which the measurement is to be utilised. Floor areas have been measured and calculated to the best of our ability. Our measurements were taken on site within the physical and time constraints of our inspection. Should the Reliant Party obtain a survey that reveals a variance in areas, then this valuation must not be relied upon before first consulting CBRE to reassess any effect on the valuation. Our comments are summarised below and are based on our inspection of reasonably accessible portions of the construction. Should the Reliant party obtain a survey that reveals a variance in areas, then this valuation must not be relied upon before first consulting CBRE to reassess any effect on the valuation. Age Circa Area Floor Cladding Roof Type Roof Cladding Heating Cooling / Cooling Utilities Connected Water Supply Accommodation Dwelling Surrounds Condition Circa 220 sqm. Timber. Timber weatherboard. Hip. Metal. Wood heater. Roof mounted evaporative air-conditioning. Electricity, telephone, bottled gas and septic system. Catchment rainwater tanks. 4 bedrooms with master bedroom featuring an ensuite, office, main bathroom, kitchen/meals, lounge room, laundry and detached garage. Lawn area, established shade trees and garden beds with a prominent rural aspect over neighbouring land. We also note the dwelling surrounds includes an in-ground swimming pool and outdoor entertaining area. Appears to be in sound condition. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 26

27 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Aspect over in-ground swimming pool Detached garage Age Area Floor Cladding Roof Type Roof Cladding Condition Greater than 25 years Circa 100 sqm. Timber. Weatherboard. Gable. Metal. Appears to be in poor condition and is considered to have limited added value. Shearing Shed and Yards Timber floor, steel and timber frame, 4 walls enclosed with metal cladding, gable metal roof and skillion side. Features provision for 3 stands that were not equipped with shearing plant at the date of inspection. Appear to be in fair condition. Features attached steel yards in fair condition. Circa 300 sqm Machinery Shed Earthen floor, steel and timber frame, 1 wall enclosed with metal cladding and gable metal roof and skillion side. Appears to be in a sound condition. Circa 240 sqm CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 27

28 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Workshop Concrete floor, timber frame, 3 walls with metal cladding and gable metal roof. Features electricity connected. Appears to be in a fair condition. Circa 85 sqm Cattle Yards Earthen floor, steel posts and rails, features a loading ramp and cattle crush. Appear to be in fair condition. Sundry Rural Structures We note the existence of various sundry structures typically comprising dated shedding or silos which we consider to be of limited added value. We Are Not Hazardous Material Experts Unless otherwise noted, we have assumed that all structures are free of asbestos and hazardous materials, or should these materials be present then they do not pose significant risk to human health, nor require immediate removal. We have made no allowance in our valuation for site remediation works. Our visual inspection is an inconclusive indicator of the actual condition/presence of asbestos/hazardous materials within the property. We make no representation as to the actual status of the subject property. If any testing is undertaken and the presence of any asbestos/hazardous materials on site is found to be positive, this valuation must not be relied upon before first consulting CBRE to reassess the valuation. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 28

29 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Seasonal Conditions & Outlook Source: Australian Bureau of Meteorology Rainfall in August was below average through the middle of Australia, extending from the southern Kimberley and eastern interior in Western Australia, through Central Australia, into south-eastern Queensland. However, the area between western Queensland and the north of Western Australia is typically seasonally dry at this time of year. Totals were also below average for much of northern New South Wales and areas along the coastal fringe of eastern Queensland, and for some areas near the southern coast of Western Australia. A large area of coastal north-eastern New South Wales, extending into adjacent south-eastern Queensland, observed monthly rainfall in the lowest 10% of historical observations for August with much of the area receiving less than 5 mm for the month. Large areas in the south of Western Australia recorded above average August rainfall totals, as did areas of south-eastern South Australia, and western and northern Victoria. Some out of season rainfall around the coast of the Gulf of Carpentaria resulted in above average monthly rainfall, although totals were small. The heaviest rain fell over south-eastern Australia during the middle of the month, associated with a vigorous cold front combining with a north-west cloudband which had drawn down warm, moist tropical air. In southwest Western Australia, a cold front produced widespread rain with daily totals between 30 millimetres and 70 millimetres, including some daily rainfall records. Average August Rainfall Departure From Long Term Average Queensland 3 mm -78% New South Wales 21.2 mm -44% Victoria 81.0 mm +10% Tasmania mm -1% South Australia 14.5 mm -20% Western Australia 16.3 mm +7% Northern Territory 0.1 mm -98% Australian Dollar The Australian Dollar started 2017 in a slightly stronger trend to 2016 at average rates between US$0.75 and US$0.77 before peaking in August at around US$0.80. This was the highest rate since May 2015, however the Australian Dollar finished the September month slightly lower at US$0.78. The recent decline in the Australian Dollar is considered somewhat positive for Australian grain producers who are largely facing reduced 2017 winter crops and relying on higher commodity prices. Source: Reserve Bank of Australia CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 29

30 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Wheat Source: Profarmer Australia and Analysing Agriculture World wheat production as at September is estimated at circa million tonnes, some 8.4 million tonnes lower than production (753.3 million tonnes) at the same time in 2016/17. However, it is noted that world production has increased some 1.7 million tonnes in previous months, primarily on the back of a record Russian wheat crop. The domestic wheat crop has again been downgraded to circa 22 million tonnes on the back of extended dry weather and frost events in the New South Wales and Queensland wheat production regions. This has now become a major concern for many producers with potential crop yields now deteriorating by the day. The southern parts of Australia, in particular Victoria and the southern parts of Western Australia, still have the potential for above average production, however finishing rains would be needed to achieve. Local wheat prices are currently trading in the vicinity of $290 per tonne (APW1 NSW Port Kembla) which is significantly higher than at the same time in 2016/17, which were historic low prices due to record domestic production. Forecasters are predicting a shortage of good quality milling wheat and therefore there should be some reasonable demand for this product in the future months. Source: Profarmer Australia Source: Index Mundi Coarse / Feed Grain Source: Profarmer Australia and Analysing Agriculture World production of coarse grain for 2017 was revised slightly up in September on the back of increased forecasts in the major grain growing regions of North and South America. Australia s production has not yet been forecast lower than previous months but is a belief that this is only a matter of time with a prolonged dry period throughout large cropping areas of Australia. Domestically a combination of increased livestock on feed in Northern Australia combined with a forecast below average sorghum crop in Queensland, is adding pressure on domestic prices which are likely to average well above world prices. Lower barley production is expected in both the EU and Australia, which are the two major exporters of barley, which could again be positive for prices. In summary, domestic prices are looking positive on the back of lower supply with F1 Feed Barley (NSW Port Kembla) trading some $80 per tonne higher than at the same period in CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 30

31 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Source: Profarmer Australia Source: Index Mundi Oil Seed Source: Profarmer Australia and Analysing Agriculture World stocks for Canola are currently low despite an increase in the area planted to a record 2.67 million hectares. This is primarily on the back of forecast below average production in Canada and Australia which are both major exporters. However, this is somewhat offset by sufficient world supplies of oilseeds on the back of sound soybean production. Domestically, Canola prices have remained relatively consistent over the last few years and are again stable. However, it is forecast that there is potential for price rise on the back of the below average season throughout large areas of Australia, with post farm gate operators looking to shore up supplies. Source: Profarmer Australia CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 31

32 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Source: Index Mundi Murray Darling Basin The water entitlements being valued are within the Murray Darling Basin (MDB). The MDB comprises 6% of Australia s surface water runoff, however, its contribution to the Australian irrigation industry is much more substantial with over 70% of the irrigation development being located within this catchment. In the early stages of development within the irrigation industry, the value of properties was closely related to the cost of land acquisition and the subsequent cost of development. A potential irrigator could buy a property, apply for a licence or buy an allocation at a nominal value, which then gave the irrigator rights to access water. In the current climate, there are no new licences being issued, with the Federal Government actually actively buying back water through various plans, via tender processes. The options that now exist, due to water reform, comprise: Purchasing permanent water entitlements. Purchasing allocation (temporary water) Limited Term Transfer (LTT). Southern Connected System The Southern Connected Murray Darling Basin is a connected resource comprising 13 interstate water trading zones covering parts of South Australia, New South Wales and Victoria. Inter-valley and interstate trade in the southern-connected Basin is possible because of the connected nature of the system. The establishment of irrigation schemes and the building of infrastructure have led to the southern-connected Murray Darling Basin becoming one of the most mature water markets in the world. The map provided below demonstrates the southern-connected basin displaying current water allocations and current dam capacities for October CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 32

33 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Source: Ruralco Water & CBRE State Variances New South Wales water entitlements are called Water Access Licences (WAL), Victorian water entitlements are called Water Entitlement Extracts (WEE) and South Australian water entitlements are called Water Licences. Water entitlements throughout New South Wales, Victoria and South Australia (in part) have traditionally been affiliated with land, however water reforms occurring within the last 10 years, has resulted in large volumes of irrigation water becoming unbundled from land, making them a tradable asset which can be permanently sold (without land), temporally sold (on an allocation basis) and mortgaged separately. The status and description of relevant states water management systems is described overleaf. Land & Water Separation (New South Wales) Water entitlements, diversion licences, water rights on regulated water systems in New South Wales were unbundled under the Water Management Act The unbundling process describes the separation of land and water. NSW water entitlements are known as Water Access Licence(s) (WAL). The Water Access Licence (s) can be held, mortgaged or leased without the land. The introduction of Water Access Licence(s) (WAL) has created water entitlements known as High Security Water, General Security Water or Supplementary Water. Allocations are made to Regulated River High Security Water before Regulated River General Security Water and then Supplementary Water. Supplementary Water was formerly known as off-allocation water and is effectively surplus flow that cannot be conserved. A Water Access Licence (WAL) specifies: The shares in the available water within a particular water management area or water source (the share component), and The times, rates or circumstances from specified areas or locations (the extraction component). CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 33

34 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 A clearly defined entitlement listed on a public Water Access Licence Register that is separate from land ownership. A clearly defined right to a share of the available water in a particular water source It is important to note that a WAL does not confer a right on any person to use water for a particular purpose or to construct or use a water supply work. Water can only be taken under a WAL by a nominated water supply work. Use of water on land also generally requires a current Water Use Approval, as described below; Water Supply Work Approval: A water supply work approval authorises its holder to construct and use a specified water supply work at a specified location. Approvals cannot be traded to another property or location. Water Use Approval: A water use approval authorises its holder to use water for a particular purpose, such as irrigation, at a particular location. It may also authorise the use within NSW of water taken from a water source outside NSW. Approvals cannot be traded to another property or location. WALs may be granted to access the available water governed by a Water Sharing plan under the Water Management Act Water Sharing Plan establish rules for sharing water between the environmental needs of the river or aquifer and water users, and also between different types of water use such as town supply, rural domestic supply, stock watering, industry and irrigation. The tenure of Water Access Licences is described below; The reference to "tenure" on a water access licence certificate indicates the duration of the licence. An access licence ceases to be in force on the date that the cancellation of the licence is recorded in the Access Register. A "continuing" water access licence is granted in perpetuity, which means it does not need to be renewed. It is typically used for a commercial purpose (such as irrigation or industrial use). "Continuing" water access licences include supplementary water access licences issued for regulated rivers. A specific purpose water access licence (eg for town water or domestic and stock purposes) must be cancelled when the purpose for which the licence was issued ceases. Irrespective of the type of tenure, a water access licence can be suspended or cancelled if there is a breach of the licence conditions or other non-compliance. New South Wales water entitlements included in this valuation are known as Water Access Licence(s) (WAL). Lachlan Catchment Overview Source: NSW Office of Water The Lachlan Regulated River travels approximately 1,500 kilometres to the Great Cumbung Swamp. Nearly 1,300 kilometres of its length is regulated. Very little water from the Lachlan River catchment reaches the Murrumbidgee or contributes to flows in the Murray, except during major floods. Most is taken up by water users or provides inflows to the wetlands in the lower Lachlan, particularly the Great Cumbung Swamp. The Lachlan River has the following entitlement volume: High Security Irrigation - 26,472 megalitres General Security Irrigation - 592,847 megalitres The Lachlan catchment is depicted overleaf. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 34

35 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Allocation Trading Rules Trade is limited to the Lachlan Regulated River. Water allocation accounts of access licences in this water source may not be assigned to the water allocation accounts of access licences in other water sources and water allocation accounts of access licences in other water sources may not be assigned to the water allocation accounts of access licences in Lachlan River water source. Allocation History As of October 2017, Upper and Lower Lachlan Regulated River allocations are: General Security: 2% High Security: 100% Jemalong Irrigation Limited Overview Jemalong Irrigation Limited is an unlisted public company controlled by a board of directors. The company holds an irrigation license on the Lachlan River of approximately 100,000 megalitres, each year diverting approximately 40,000 megalitres to 119 shareholders within the district. The district comprises more than 96,000 hectares of farming land of varying soil types capable of supporting a wide range of cropping and livestock enterprises. The Jemalong irrigation District is depicted below as provided by Jemalong Irrigation Limited. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 35

36 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Jemalong Irrigation Limited District Map Source: Jemalong Irrigation Limited Water Classes There are 3 categories of water issued within the Jemalong Irrigation Limited District; Domestic & Stock Entitlement High Security Water Entitlement General Security Water Entitlements Subject to the Jemalong Irrigation Limited rules, these entitlements may be transformed to Water Access Licenses within the Lachlan Regulated River Water Source. Water entitlements held by Jemalong Irrigation Limited are summarised below. Jemalong Irrigation Limited Lachlan Regulated River Category Volume (Ml) Domestic and stock 1,756 Regulated river (high security) 200 Regulated river (general security) 79,220 Conveyance 17,911 Source: NSW Office of Water Current Water Sales Market participants, water brokers and active real-estate agents are uniform in their view that the price of General Security water entitlements held in Jemalong Irrigation Limited is highly correlated with entitlements held within the Lachlan Regulated River. Our enquires with local real estate agents and water brokers have established that large scale water entitlements would currently trade for approximately $650 - $700 per megalitre. However, they noted that there were some smaller parcels currently making in excess of this. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 36

37 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 We are aware of two large scale Jemalong Irrigation Limited (General Security) water entitlements recently transacting with properties in close proximity to Yarranlea Farms which we describe as follows: August June June Refer to Sales Analysis for further detail. 1,342 $650 ( Yarranlea Farms ) 2,600 $625 ( Bergen Park ) 550 $600 ( Gibrigal ) Market Overview "Yarranlea Farms" is a mixed irrigated and dryland cropping/grazing holding situated at Lake Cowal between West Wyalong and Forbes in the Central West region of New South Wales. The locality is predominantly utilised for dryland or irrigated cropping and livestock grazing at a broad hectare scale. There are some rural lifestyle properties situated in closer proximity to West Wyalong and Forbes. Drivers of market value in the region include: Productivity; Rates of return; Interest rates; Supply and demand for property; Commodity prices (farm gate prices); Availability of capital (debt and equity); and Currency exchange rates. The market comprises three distinct segments. The high end institutional/large scale corporate family farm which is greater than $10,000,000, the typical family farm, ranging in value from $1,500,000 - $10,000,000 and the lower end of the market, classed as sub $1,500,000. The three market categories are highly correlated with the high end institutional/large scale corporate family farm segment achieving renewed interest and increased levels of demand. When larger scale properties are offered to the market they generally transact within normal marketing periods due to their sought after nature of desirable natural land attributes such as soil type and rainfall. Real estate agents operating in the subject market have previously reported that the demand for wellregarded properties was sound; however the last 12 to 24 months have seen a significant change in this market and we believe the main drivers of the land value increase and current strong demand in the region is a mixture of the following: Increased large scale corporate / institutional demand for broad hectare cropping land. Previously there were minimal corporate / institutional investors situated in the subject locality, however over the last 12 months we have seen the introduction and enquiry of numerous large scale operators looking to invest in the region; The limited supply of good quality land advertised for sale coupled with the competitive tension currently evident in the market, has resulted in bidding wars with strong price levels being achieved. The price pressure from the more expensive land to the south and the east is starting to have an effect with operators from different regions looking to now invest in the subject locality; Active family farmers are prominent in the market; The introduction of cotton and legume crops into the region; Beef and lamb industries which are currently at record levels; Significant lower fuel prices; Historically low fertiliser prices; Improving grain commodity prices; Record low interest rates; and A significant lower Australian Dollar. Further discussions with local agents established that land values in the subject locality increased by up to 25% to 30% within the last 24 months. The two most recent sales in Bergen Park and Gibrigal are situated in proximity to Yarranlea Farms and best reflect the current market conditions. Both of these CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 37

38 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 properties transacted for perceived strong market value levels and are considered the most comparable evidence to Yarranlea Farms Refer to Sales Evidence for further detail. The extent to which this renewed confidence translates to upward pressure on property values is difficult to predict, however we expect if it is sustained, large scale good quality assets such as the subject property, will be the beneficiaries of strong demand and increasing prices in the marketplace throughout CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 38

39 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Overview These sales, amongst others, demonstrate investment activity during the last 2 years. Not all of the sales are considered to be directly comparable, however they do provide a range of evidence and set the parameters upon which we have based our assessment of value of "Yarranlea Farms". In our efforts to provide the most recent sales data, there may be occasions where we utilise sales that have not settled, have delayed settlement, or are not registered on third party databases. Separate enquiries are made of the parties to the transaction or their agents to verify this data. Third party databases do not specify transactions as GST inclusive or exclusive, and where we have been unable to verify the GST status we have assumed the sale price is GST exclusive. Should further enquiries reveal the status to be incorrect, we reserve the right to adjust our analysis and if necessary our valuation. 5 1 SP Source: Google Maps, CBRE Agribusiness Research SP Yarranlea Farms 1. "Yarranlea Farms", 424 Warroo Road, Lake Cowal, NSW. 2. "Bergen Park", 6751 Newall Highway, Corinella, NSW. 3. "Gibrigal", 756 West Plains Road, Lake Cowal, NSW. 4. "Belmont Aggregation", Garema Pinnacle Road, Garema, NSW. 5. "Ulundi", 2389 Lachlan Valley Way, Jemalong, NSW. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 39

40 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 SALE 1 "Yarranlea Farms", 424 Warroo Road, Lake Cowal, NSW Sale Details/Comment Sale Price Sale Date Land Area (ha) All Incl Rate ($/ha) Land Rate ($/ha) Tooth to Duxton Broadacre Farms $7,435,000 Aug , $3,404 $2,869 Pty Ltd Yarranlea Farms is situated on the eastern side of Warroo Road approximately 48 radial kilometres south-west of Forbes. The south western portion of the property abuts Lake Cowal. Yarranlea Farms is relatively level throughout. The highest areas of elevation are situated to the elevated timber ridgeline to the south-eastern portion of the property. Soil types are well regarded grey self-mulching clay soils to the southern portion and mixed red and grey loam soil types to the northern portion. The property includes approximately 2,184 hectares of land with 350 hectares developed to irrigated row cropping and 1,604 hectares of dryland cropping / grazing land. The balance of land, approximately 230 hectares, comprises remnant vegetation and timbered grazing land. At the date of sale the irrigation land was being utilised for cotton production with the dryland being utilised for cropping (cereals and canola) and grazing (sheep and cattle). The irrigation land is benefited by the recent construction of a circa 688 megalitre turkeys nest irrigation dam and 12 megalitre surge. Irrigation water is released to the land by through the bank pipes. The irrigation land is supported by access to approximately 1,342 megalitres of Jemalong Irrigation Limited General Security water. Yarranlea Farms includes a significant laneway system which facilitates vehicular and livestock movement to the majority of the property s 15 paddocks. Structures include main dwelling & surrounds, dated cottage and rural infrastructure. Zoned Primary Production pursuant to the Forbes Local Environment Plan Discussion with the selling agent established that there was strong purchaser demand for the property with numerous registered bidders. Apportionment Land Area (ha) Rate ($/ha) Irrigated Flood (Row Crop) $4,250 $1,487,500 Dryland Cropping / Grazing $2,800 $4,491,368 Remnant Vegetation / Timbered Grazing $1,250 $287,500 $6,266,368 Water Volume (Ml) Rate ($/Ml) Upper Lachlan Regulated (JIL) $650 $872,300 Structures Main Dwelling & Surrounds Say $225,000 Rural Structures Say $70,000 $295,000 Total Apportionment $7,433,668 CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 40

41 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 SALE 2 "Bergen Park", 6751 Newell Highway, Corinella, NSW Sale Details/Comment Sale Price Sale Date Land Area (ha) All Incl Rate ($/ha) Land Rate ($/ha) Maslin to Syndicate Circa $9,600,000 Jun , $3,429 $2,521 Bergen Park is located on the western side of the Newell Highway, approximately 30 radial kilometres south-west of Forbes. Bergen Park is irregular in shape and generally level to slightly undulating in topography. The highest areas of elevation are situated to the eastern boundary which fronts the Jemalong Ranges. Native vegetation comprises yellow box, pine and belah species and is situated throughout including areas of dense timber stands and scattered shade trees. The majority of the land utilised for cropping is cleared of vegetation. Soils are considered varied, generally comprising a mixture of red clays and red loams transitioning to heavy grey and black self-mulching soils. There are also some small areas of sand based soils. At the date of sale, Bergen Park was operated as a mixed irrigated and dryland cropping/grazing enterprise with approximately 631 hectares developed and utilised for flood irrigation, 1,176 hectares utilised for dryland cropping with the balance (993 hectares) utilised for timbered grazing. Irrigation water is sourced via a Jemalong Irrigation Limited surface water entitlement of 2,600 megalitres of General Security. The property is situated in the Jemalong Irrigation Scheme which accesses water from the Lachlan River. The property does not have access to irrigation groundwater. Livestock water is sourced via catchment dams and scheme water with the majority of the paddocks able to access water. Fencing is considered to be in sound condition, generally comprising steel posts with hinge joint wire dividing the property into approximately 30 paddocks. Structures include a historic 5 bedroom homestead which has recently been renovated and set in established surrounds with in-ground swimming pool, 7 stand shearing shed & yards complex, large machinery shed / workshop complex, newly constructed grain silos with circa 2,705 tonnes capacity and a 1,250 head modern lamb feedlot with watering system. The property is zoned Primary Production (RU1) pursuant to the Forbes Local Environmental Plan Bergen Park was purchased by a syndicate from Moree with a delayed settlement until late We also note that a small portion of timbered grazing land to the east of the Newell Highway was subdivided and sold separately. Apportionment Land Area (ha) Rate ($/ha) Irrigation - Flood $4,000 $2,524,000 Dryland Cropping / Grazing $2,800 $3,292,800 Remnant Vegetation / Timbered Grazing $1,250 $1,241,250 $7,058,050 Water Volume (Ml) Rate ($/Ml) Upper Lachlan Regulated (JIL) $625 $1,625,000 Structures Homestead & Surrounds Say $300,000 Shearing Shed & Yards Say $100,000 Rural Shedding Say $150,000 Livestock Yards & Feedlot Say $45,000 Silo Storage 2,705 T $120 per tonne $324,600 $919,600 Total Apportionment $9,602,650 CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 41

42 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 SALE 3 "Gibrigal", 756 West Plains Road, Lake Cowal, NSW Sale Details/Comment Sale Price Sale Date Land Area (ha) All Incl Rate ($/ha) Land Rate ($/ha) Domco Trading Pty Ltd to Mattiske $2,524,678 May $2,948 $2,484 Gibrigal is located on the southern side of the West Plains Road, approximately 45 radial kilometres south-west of Forbes. Gibrigal is irregular in shape and generally level to slightly undulating in topography with the highest areas of elevation are situated to the eastern boundary. Native vegetation comprises yellow box, pine and belah species and has primarily been cleared save for some small scattered timber stands. Soils primarily include grey and black self-mulching soils with some small areas of red loams. Gibrigal is operated as a mixed dryland cropping and grazing enterprise, however featured approximately 125 hectares of dated laser levelled irrigation land (not in use) dryland only. The balance of the land includes 712 hectares utilised for dryland cropping with the balance (20 hectares) utilised for timbered grazing. Irrigation water can be sourced via a Jemalong Irrigation Limited surface water entitlement of 550 megalitres of General Security. The property is situated in the Jemalong Irrigation Scheme which accesses water from the Lachlan River. The property did not have access to irrigation groundwater. Structures include a dated brick cottage, basic rural shedding and 5 conical base silos. The property is zoned Primary Production (RU1) pursuant to the Forbes Local Environmental Plan Apportionment Land Area (ha) Rate ($/ha) Irrigation - Flood (Dated) $2,600 $325,000 Dryland Cropping $2,500 $1,778,750 Timbered Grazing $1,200 $24,000 $2,127,750 Water Volume (Ml) Rate ($/Ml) Upper Lachlan Regulated (JIL) $600 $330,000 Structures Cottage Say $40,000 Rural Structures Say $25,000 $65,000 Total Apportionment $2,522,750 SALE 4 "Belmont Aggregation", Garema Pinnacle Road, Garema, NSW Sale Details/Comment Sale Price Sale Date Land Area (ha) All Incl Rate ($/ha) Land Rate ($/ha) Hohnberg to Lawson Grains Pty Ltd $5,535,748 Apr , $2,663 $2,531 "Belmont Aggregation" comprises 4 non-contiguous properties that are situated in the Garema district, approximately 14 radial kilometres south of Forbes. The properties are known as "Belmont", "Ravenswood", "Coromby & Wilga View" and "Hillview". "Belmont" comprises approximately 477 hectares and is generally level in topography with self mulching soil types. "Ravenswood" comprises approximately 389 hectares and is generally level in topography with self mulching soil types. "Coromby & Wilga View" comprises approximately 823 hectares and is generally level in topography with self mulching and small area of red soil types. "Hillview" comprises approximately 390 hectares of undulating land with mixed red soil types. Vegetation has predominately been cleared of all properties with the exception of a large timber stand to the north of "Hillview" and some scattered timber throughout balance of the properties. At the time of sale the aggregation was primarily operated as a cropping and grazing enterprise with approximately 92% of land considered arable and the balance (8%) remnant vegetation / timbered grazing land. Fencing comprises a mixture of agricultural construction throughout the 4 properties in varying states of repair. Livestock water can be sourced on the property via catchment dams. Structures include 2 liveable dwellings, shearing shed & yards, rural shedding and silo storage. Zoned Primary Production pursuant to the Forbes Local Environmental Plan The aggregation was purchased by a corporate operator who had been an active market participant in the locality since late "Belmont Aggregation" surrounded the existing aggregation owned by the purchaser and is considered to have improved the layout. Apportionment Land Area (ha) Rate ($/ha) Arable $2,700 $5,180,679 Remnant Vegetation / Timbered Grazing $500 $80,000 $5,260,679 Structures Dwellings & Surrounds (2) Say $215,000 Shearing Shed & Yards Say $30,000 Sundry Rural Structures Say $30,000 $275,000 Total Apportionment $5,535,679 CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 42

43 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 SALE 5 "Ulundi", 2389 Lachlan Valley Way, JEMALONG, NSW Sale Details/Comment Sale Price Sale Date Land Area (ha) All Incl Rate ($/ha) Land Rate ($/ha) Toole to Brown $2,300,000 Dec $7,419 $3,599 Ulundi is located on the south-western side of Lachlan Valley Way, approximately 26 radial kilometres west of Forbes. The property is irregular in shape and near level in topography, with the highest areas of elevation to the central portion of the property, gently sloping to the north and south. Vegetation comprises small stands of remnant timber / timbered grazing and scatted shade trees throughout. Soils include areas of self-mulching grey to black soils. Ulundi is operated as a mixed irrigation and dryland cropping property with approximately 275 hectares developed to flood irrigation, 25 hectares dryland cropping / grazing with the balance (10 hectares) considered remnant vegetation / timbered grazing. We note that a portion of the dryland cropping / grazing area is benefited by "prior stream". Irrigation water is sourced via both surface and groundwater entitlements. The surface water is obtained via 345 megalitre water share which is facilitated via Jemalong Irrigation Limited. Groundwater water is accessed via a 942 megalitre Upper Lachlan groundwater entitlement. We are advised that the bore water quality is sound and therefore does not need be shandied with surface water prior to being applied to the land. Structures include a 5 bedroom dwelling set in established garden surrounds, 4 stand shearing shed with associated yards, machinery shed / workshop and sundry rural structures including a hay shed. The property is zoned Primary Production (RU1) pursuant to the Forbes Local Environmental Plan Apportionment Land Area (ha) Rate ($/ha) Irrigation - Flood $3,725 $1,024,375 Dryland Croping / Grazing $3,450 $86,250 Remnant Vegetation / Timbered Grazing $500 $5,000 $1,115,625 Water Volume (Ml) Rate ($/Ml) Upper Lachlan Regulated River (JIL) $400 $138,000 Upper Lachlan Groundwater $700 $659,400 $797,400 Structures Dwelling & Surrounds Say $240,000 Shearing Shed & Yards Say $50,000 Machinery Shed / Workshop Say $35,000 Silos (120 tonne) Say $10,000 Rural Sundry Structures Say $50,000 $385,000 Total Apportionment $2,298,025 Indicative Rates: The sales analysis reflects the following indicative rates: Sale prices of $2,300,000 to $9,600,000. All-inclusive rates per hectare of $2,663 to $7,419. Analysis: The rates reflected in our analysis of the sales evidence are summarized as follows: Land rates of $2,484 to $3,599 per hectare. Irrigation land rates of $3,750 to $4,250 per hectare. Dryland Cropping / Grazing land rates of $2,500 to $3,450 per hectare. Remnant Vegetation / Timbered Grazing land rates of $500 to $1,250 per hectare. Upper Lachlan Regulated (JIL) water rates of $400 to $650 per megalitre. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 43

44 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Overview In arriving at our opinion of value, we have employed industry recognised valuation methodologies. We have considered relevant general and economic factors and in particular have investigated recent sales and leasing transactions of comparable properties (as previously detailed). Valuation Approaches Direct Comparison Summation. Methodology The market evidence detailed in this report, amongst other evidence, has been compared with "Yarranlea Farms" in order to assess a market based valuation. This valuation methodology is commonly known as the Direct Comparison Approach. We have analysed the available property sales evidence by apportioning the sale price to the various asset components (where applicable) as follows: Land various land classes on an as is cleared, fenced and watered basis. Water irrigation water entitlements (i.e. groundwater and/or surface water assets). Structures the structural improvements on the land (i.e. dwellings, sheds, yards). Inclusions most commonly plant & equipment, livestock and standing crops. Key Comparability Factors Given that the comparability of each of the analysed sale properties is likely to vary, a high degree of value judgement is required by the valuer. The valuer has considered a range of variables which may include: The nature, condition and market appeal of the property. The price category of the property. The location, aspect, topography, mix of soil types, land area, access and level of land development. The reputation of the property in the marketplace. The circumstances of the vendor or purchaser. The productive capacity, scale and diversity of the property together with its development potential. The type and reliability of water entitlements (if applicable). Arable percentage. Flood risk. Overview In our sales analysis, we have benchmarked the different land classes to disclose an indicative rate per hectare for each. We have identified three relevant land classes being Irrigation - Row Crop, Dryland Cropping & Grazing and Remnant Vegetation / Timbered Grazing. Irrigation Flood (Row Crop) is land that has been developed to flood irrigation (row crop) for continuous cropping purposes. It is typically utilised to support cotton production and can also support lower value crops such as cereals. Dryland Cropping / Grazing - is land which is considered suitable for the cultivation in addition to the grazing of livestock. Remnant Vegetation / Timbered Grazing is land that is not suitable for cultivation without development due to physical factors such as topography or the density of trees. However this land class may be utilised for opportunity grazing. Our rationale follows overleaf. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 44

45 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Irrigation Flood (Row Crop) We have relied upon our key local sales of Bergen Park ($4,000/ha) and Ulundi ($3,725/ha) in assessing the Irrigation Flood (Row Crop) land rate for Yarranlea Farms. We have also taken into account the recent purchase of the subject property, Yarranlea Farms ($4,250/ha). Bergen Park ($4,000/ha), is situated in a slightly superior location. Bergen Park includes a larger irrigable area of 631 hectares which is considered to be inferior in level of development when compared to Yarranlea Farms. We therefore believe the Irrigation Flood (Row Crop) rate per hectare displayed by Bergen Park to be slightly inferior to Yarranlea Farms. Ulundi ($3,725/ha), is situated in a slightly superior location and includes a similar soil type. Ulundi includes a smaller irrigable area of 275 hectares which is considered to be inferior in level of development when compared to Yarranlea Farms. This transaction is now considered to be dated and was purchased in inferior market conditions. We therefore believe the Irrigation Flood (Row Crop) rate per hectare displayed by Ulundi to be inferior to Yarranlea Farms. In recent years significant capital works expenditure has been spent on the development of Irrigation Flood (Row Crop) land on Yarranlea Farms. The level of irrigation development on Yarranlea Farms is considered to be a feature of the property and is benefited by a significant turkeys nest storage dam (which the comparable sales do not feature). We have also taken into account the standing of the property in the market place and the significant interest that was achieved during the sales process. Given the foregoing, we have applied an Irrigation Flood (Row Crop) land rate of $4,250 per hectare for Yarranlea Farms. Dryland Cropping / Grazing When assessing a Dryland Cropping / Grazing land rate per hectare we have relied upon the key local sales of "Bergen Park ($2,800/ha) and Gibrigal ($2,500/ha). Both properties are situated in proximity to Yarranlea Farms with Bergen Park considered the most comparable. We have also taken into account the recent purchase of the subject property, Yarranlea Farms ($2,800/ha). Bergen Park ($2,800/ha), is situated in a slightly superior location and includes a smaller dryland cropping / grazing area. Bergen Park is considered to be a comparable type asset to Yarranlea Farms and therefore attracted strong interest. We believe the soil types are considered to be generally comparable, however the layout is considered inferior to that of Yarranlea Farms. We therefore believe the rate per hectare displayed by Bergen Park for Dryland Cropping / Grazing to be comparable to Yarranlea Farms. Given the foregoing, we have applied $2,800 per hectare for the Dryland Cropping / Grazing land on Yarranlea Farms. Remnant Vegetation / Timbered Grazing With respect to the Remnant Vegetation / Timbered Grazing land we have relied on the local sales of Bergen Park ($1,250/ha) and Gibrigal ($1,200/ha). Both the sales have the ability to be utilised for opportunity grazing. Given the foregoing, we have applied $1,250 per hectare for the Remnant Vegetation / Timbered Grazing land on Yarranlea Farms. Irrigation Water In relation to the General Security water shares held in Jemalong Irrigation Limited entitlements, we have had the most reliance on recent property transactions which have occurred on neighbouring properties and incorporated Jemalong Irrigation Limited entitlements. This includes Bergen Park ($625/Ml), Gibrigal ($600/Ml) and the sale of the subject property Yarranlea Farms ($650/Ml). Yarranlea Farms was purchased at a later date than the other transaction in an increasing water market. Give the foregoing, we have applied a rate of $650 per megalitre. Structures We have calculated the added value of the structures by deducing from our analysis of sales evidence. Our calculations are summarised overleaf. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 45

46 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 SUMMATION BASIS Land Area (ha) Rate $/ha Value Irrigation - Flood (Row Crop) $4,250 $1,487,500 Dryland Cropping / Grazing $2,800 $4,491,368 Remnant Vegetation / Timbered Grazing $1,250 $287,500 SubTotal 2, $2,869 $6,266,368 Water Ml Rate $/Ml Value Upper Lachlan Regulated (JIL) $650 $872,300 SubTotal 1,342 $650 $872,300 Structures Area (sqm) Rate $psm Value Main Dwelling & Surrounds 220 Say $225,000 Cottage 0 Say $10,000 Shearing Shed & Yards $75 $22,500 Machinery Shed $75 $18,000 Workshop $75 $6,375 Cattle Yards 0 Say $10,000 Sundry Rural Structures 0 Say $5,000 SubTotal $296,875 Total $7,435,543 TOTAL (rounded) $7,435,000 Reconciliation We have reconciled the value as follows: VALUATION RECONCILIATION "Yarranlea Farms" $7,435,000 ADOPT $7,435,000 We have therefore adopted $7,435,000 (Seven Million, Four Hundred and Thirty Five Thousand Dallars) for "Yarranlea Farms", 424 Warroo Road, Lake Cowal, NSW 2671 as at 25 October Treatment of GST Our valuation is expressed exclusive of GST. We are not tax experts and have not been provided with tax or legal advice. The Reliant Party must make its own enquiries if they consider that GST applies. CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 46

47 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 The report must be read in accordance with and subject to the following qualifications: Market Movement Extent of Investigations Assumptions Information Supplied By Others Future Matters Industry Practice Values vary from time to time in response to changing market circumstances. The valuation is based on available information as at the date of valuation. No warranty can be given as to the maintenance of this value into the future. Therefore, it should be reviewed periodically. We are not engaged to carry out all possible investigations in relation to the property. Where in our report we identify certain limitations to our investigations, this is to enable the Reliant Party to instruct further investigations where considered appropriate or where we recommend as necessary prior to Reliance. CBRE is not liable for any loss occasioned by a decision not to conduct further investigations. Assumptions are a necessary part of undertaking valuations. CBRE adopts assumptions for the purpose of providing valuation advice because some matters are not capable of accurate calculation or fall outside the scope of our expertise, or our instructions. Assumptions adopted by CBRE will be formulated on the basis that they could reasonably be expected from a professional and experienced valuer. The Reliant Party accepts that the valuation contains certain specific assumptions, and acknowledges and accepts the risk that if any of the assumptions adopted in the valuation are incorrect, then this may have an effect on the valuation. This document contains information which is derived from other sources. Where this information is provided by experts and experienced professionals, we have relied upon the expertise of such experts and by necessity we have relied upon the information provided being accurate, whether prepared specifically for valuation purposes or not. Unless otherwise specifically instructed by you, we have not independently verified that information, nor adopted it as our own. Notwithstanding the above, we have reviewed the provided information to the extent that such a review would be reasonably expected from a professional and experienced valuer having regard to normal industry practice undertaking a similar valuation/consultancy service. The Reliant Party acknowledges that the valuer is not a specialist in the areas from which the expert information is derived and accepts the risk that if any of the information/advice provided by others and referred to in the valuation is incorrect, then this may have an effect on the valuation. To the extent that the valuation includes any statement as to a future matter, that statement is provided as an estimate and/or opinion based on the information known to CBRE at the date of this document. CBRE does not warrant that such statements are accurate or correct. Subject to the assumptions and qualifications detailed within, this valuation report is issued in accordance with the Australian Property Institute Valuation and Property Standards (ISBN ) and International Valuation Standards (ISBN ). Where these are at variance, the assumptions and qualifications included within this valuation report will prevail generally, and the International Valuations Standards will prevail over the Australian Property Institute Valuation and Property Standards. DO NOT DELETE > ensure text retains its style with White CBRE Valuations Pty Limited CBRE Valuations Pty Limited (CBRE) VALUATION REPORT October 2017 Page 47

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49 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Copy of Letter of Engagement CBRE Valuations Pty Limited (CBRE) APPENDICES October 2017

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63 "Yarranlea Farms" 424 Warroo Road, Lake Cowal, NSW 2671 Contract of Sale CBRE Valuations Pty Limited (CBRE) APPENDICES October 2017

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