DUXTON FARMS LTD — Net Asset Value 2018

Jun 14, 2018

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15 June 2018

INDEPENDENT VALUATION UPDATE

Duxton Broadacre Farms Ltd (“DBF” or “the Company”) has engaged CBRE Valuations Pty Limited (“CBRE”) to provide an updated Independent Valuation Report for land, water and structures of the Company as at 14 June 2018.

We are extremely pleased to announce that the fair value of land, water and structures have been valued at $68,200,000 representing a $9,865,000 or 16.91% uplift in asset values.

As a result of the adjustments to reflect the abovementioned updated independent land and water values, the unaudited underlying Net Asset Value per Share (“NAVPS”) of DBF as at 31 May 2018 was $1.72 . The after tax NAVPS figure takes into account the provision for deferred tax and estimates of net tax provisions that may arise should the entire portfolio be disposed of on the above date.

Property Valuation Summary

	VALUATION$ AUD	VALUATION$ AUD
Property	As at March 2017	As at 14 June 2018	**Change **
YARRANLEA	*$7,435,000	$7,850,000	5.58%
MERRIMENT	$2,000,000	$2,600,000	30.00%
COWARIBIN	$2,100,000	$2,800,000	33.33%
WALLA WALLAH	$7,000,000	$8,000,000	14.29%
TIMBERSCOMBE	$24,000,000	$28,750,000	19.79%
KENTUCKY	$15,800,000	$18,200,000	15.19%
Total	$58,335,000	$68,200,000	16.91%

* Yarranlea was first valued in October 2017

The valuation has been prepared for financial reporting purposes in accordance with AASB 13 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 valuation is in accordance with the Australian Property Institute Australian and New Zealand Valuation and Property Standards January 2012, having regards to ANZVGN 8.

Duxton Broadacre Farms Limited 7 Pomona Road, Stirling SA 5152

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Valuation Breakdown

	As at March 2017*	As at March 2017*	As at 14 June 2018	As at 14 June 2018
	Vol.	$ Total	Vol.	$ Total	**Value Change **
YARRANLEA
Land	2,184 Ha	$6.27 m	2,184 Ha	$6.35 m	1.28%
Water	1,342 ML	$0.87 m	1,342 ML	$1.21 m	38.46%
Structures	n/a	$0.30 m	n/a	$0.30 m	0.00%
MERRIMENT
Land	535 Ha	$1.22 m	535 Ha	$1.80 m	46.98%
Water	570 ML	$0.41 m	570 ML	$0.43 m	3.45%
Structures	n/a	$0.36 m	n/a	$0.37 m	2.75%
COWARIBIN
Land	940 Ha	$1.75 m	940 Ha	$2.43 m	39.00%
Water	n/a	n/a	n/a	n/a	n/a
Structures	n/a	$0.35 m	n/a	$0.37 m	4.64%
WALLA WALLAH
Land	1,460 Ha	$4.53 m	1,460 Ha	$5.27 m	16.55%
Water	2,543 ML	$2.29 m	2,543 ML	$2.42 m	5.56%
Structures	n/a	$0.19 m	n/a	$0.31 m	62.30%
TIMBERSCOMBE
Land	8,432 Ha	$23.11 m	8,432 Ha	$27.85 m	20.50%
Water	n/a	n/a	n/a	n/a	n/a
Structures	n/a	$0.89 m	n/a	$0.90m	0.75%
KENTUCKY
Land	5,914 Ha	$14.83 m	5,914 Ha	$17.00 m	14.66%
Water	811 ML	$0.51 m	811 ML	$0.73 m	44.00%
Structures	n/a	$0.46 m	n/a	$0.47 m	2.23%

*Yarranlea valued in October 2017

The independent valuation reports are available in their entirety on the Company’s website: www.duxtonbroadacre.com

A Summary Letter from CBRE for each property is attached to this announcement.

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Ed Peter

Chairman

Duxton Broadacre Farms Limited 7 Pomona Road, Stirling SA 5152

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Summary Letter
Property – “Yarranlea Farms” 424 Warroo Road, Lake Cowal NSW 2671
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14 June 2018

CBRE Valuations Pty Limited ABN 15 008 912 641 Level 34 8 Exhibition Street Melbourne VIC 3000 T 61 3 8621 3333 F 61 3 8621 3330 tom.burchell@cbre.com.au www.cbre.com.au

Mr William Brennan Authorised Representative Duxton Broadacre Farms Limited 7 Pomona Road STIRLING SA 5152 Via Email: will.brennan@duxtonam.com

Dear Sir

Summary of Valuation Report Property – “Yarranlea Farms” 424 Warroo Road, Lake Cowal NSW 2671

INSTRUCTIONS

CBRE Valuations Pty Limited (“CBRE”) accepted instructions dated 17 April 2018 to prepare a Fair Value Valuation for the interest in the property listed above. The Valuation is to be relied upon for Financial Reporting purposes only and is specifically addressed for use and reliance upon, by the party named above. The Valuation is prepared in accordance with the Australian Property Institute Australia and New Zealand Valuation and Property Standards, having regard to ANZVGN 8 Valuations. The instructions specifically request us to provide our opinion of the Fair Value for financial reporting as at 14 June 2018 of the holding which CBRE undertook as at 10 May 2018 on the following basis:

1. Fair Value for Financial Reporting purposes only. 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:

2. “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.”

3. The fair value of a non-financial asset is based on its highest and best use to market participants.

CBRE has been instructed to provide a full Valuation Report in addition to this Summary Letter. In accordance with ANZVGN 8, our Valuation Report draws attention to the key issues and considerations impacting value and the report details our Critical Assumptions, General Assumptions, Disclaimers, Limitations, Qualifications and Recommendations. As commercial investments of this nature are inherently complex and the market conditions have changed and/or have been uncertain in recent times, it is considered prudent to consider the entire contents of our Valuation Report. Therefore, we recommend that this Summary Letter be read and considered together with the Valuation Report. We accept no responsibility for reliance upon the Summary Letter. We refer the reader to Duxton Broadacre Farms Limited to obtain a copy of our Valuation Report.

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Summary Letter
Property – “Yarranlea Farms” 424 Warroo Road, Lake Cowal NSW 2671
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BRIEF DESCRIPTION OF THE PROPERTY

“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.

MARKET MOVEMENT

The property is valued for financial reporting as at 14 June 2018, while our inspection of the property was on 10 May 2018. We have assumed that the land and buildings and real estate market conditions remain unchanged between the date of inspection and the date of valuation. The value assessed may change significantly and unexpectedly over a relatively short period of time (including as a result of general market movements or factors specific to the particular property or particular property sector). CBRE is not liable for losses arising from any subsequent changes in value.

CRITICAL ASSUMPTIONS AND RELIANCE ON INFORMATION PROVIDED

A summary of select Critical Assumptions noted in the full Valuation Report are noted as follows:

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	In an effort to apportion the correct land classes across the aggregation, we have relied upon information
Apportionment	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

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Summary Letter
Property – “Yarranlea Farms” 424 Warroo Road, Lake Cowal NSW 2671
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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.

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 holder 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. We have not been provided with current water entitlement searches, as such we have relied upon searches provided by the client dated May 2017. It is an express assumption that the water entitlements have not varied. Further, we have assumed that there has been a change in ownership and the water entitlements are entirely held/owned by Duxton Broadacre Farms Limited. We reserve the right to review the valuation if any of the information provided is found to be incorrect. 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 We have been advised that the property has access to Stock and Domestic water from the Moora Plains Water Scheme 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. Certificates of Title We have not been provided with current Certificates of Title and associated Plan searches, as such we have relied upon title searches provided by the client dated May 2017. It is an express assumption that associated Certificates of Title and associated plan searches have not been adversely impacted by any encumbrances / registrations that have occurred since the search date. Further, we have assumed that there has been a change in ownership reflected by the tiles and the property is entirely owned by Duxton Broadacre Farms Limited. We reserve the right to review the valuation if any of the information provided is found to be incorrect. Caveats As at the search date, the following caveats are noted on Title:  Caveat by New South Wales Rural Assistance Authority via instrument number AD778333.  Caveat by New South Wales Rural Assistance Authority via instrument number AJ796494.  Caveat by New South Wales Rural Assistance Authority via instrument number AB794587 (caveat consented via instrument numbers AC249704 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.

RECOMMENDATIONS

Prior to relying on the report, the Reliant Party is to obtain the following information/additional advice:

Moora Plains Water We have not sighted a formal agreement for the Moora Plains Water Scheme allowing access to the property to Scheme legally be upheld.

We recommend that such agreement be provided or if not in place created via an easement.

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Summary Letter
Property – “Yarranlea Farms” 424 Warroo Road, Lake Cowal NSW 2671
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We have relied upon information provided by Duxton Broadacre Farms Limited.

Our valuation is based upon the most current information available at the time the valuation was prepared. CBRE accepts no responsibility for subsequent changes in information as to market conditions.

In the current market, it is our view that a 3-6 month marketing period may be required to effect a disposal of the interest in the asset assuming a professional marketing campaign.

REPORT CONTENT

Our Valuation Report, in addition to the content noted earlier, contains detailed information and description pertaining to: Instructions; Use and Reliance; Site Details including Location, Legal, Environmental and Town Planning; and Building Improvements. This is followed by a comprehensive Agriculture and Water Market Overview and details of the sales evidence regarded. Finally, the report considers the value and marketability of the property. We again refer the reader of this letter to our Valuation Report for detail in respect of the above items.

VALUATION METHODOLOGY

In arriving at our opinion of market value in accordance with the instructions, we have placed primary emphasis on the Direct Comparison approach.

VALUATION SUMMARY

In accordance with the instructions, we summarise our valuation conclusions for the subject holding as at 14 June 2018 as follows:

1. Fair Value

VALUATION RECONCILIATION
"Yarranlea Farms"	$7,850,000
ADOPT	$7,850,000

“Yarranlea Farms”

$7,850,000 (Seven Million, Eight Hundred and Fifty Thousand Dollars), exclusive of GST.

CONSENT

CBRE Valuations Pty Limited provides its consent for the inclusion of the Summary Letter, unaltered and in its entirety to the ASX making recipients of such documents aware of the following liability disclaimers. Any further reference to CBRE, the valuation or the valuer within a public document shall require further express review of the content and our express consent prior to release.

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Summary Letter
Property – “Yarranlea Farms” 424 Warroo Road, Lake Cowal NSW 2671
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LIABILITY DISCLAIMER

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 or Summary Letter 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 including the ASX Disclosures, other than in respect to the Summary Letter and the full Valuation Report.

• (c) The Valuation Report and the Summary Letter are 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. 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 real estate market subsequent to the date of valuation.

• (d) CBRE has prepared the full Valuation Report and Summary Letter relying on and referring to information provided by third parties 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) References to the Property’s value within the Summary Letter have been extracted from CBRE’s Valuation Report. The Valuation Report draws attention to the key issues and considerations impacting value and provides a detailed assessment and analysis as well as key critical assumptions, assumptions, disclaimers, limitations and qualifications and recommendations. As commercial investments of this nature are inherently complex and the market conditions have changed and/or have been uncertain in recent times, CBRE recommends that this Summary Letter and any references to value within the ASX Disclosure must be read and considered together with the Valuation Report. This Summary Letter is to be read in conjunction with our full Valuation Report dated and is subject to the Assumptions, Limitations, Disclaimers and Qualifications contained therein. We refer the reader to Duxton Broadacre Farms Limited to obtain a copy of the Full Valuation Report.

• (f) No responsibility is accepted for any loss or damage arising as a result of reliance upon the Summary Letter and the full Valuation Report.

• (g) Neither this Summary Letter nor the full Valuation Report may be reproduced in whole or in part without the prior written approval of CBRE.

• (h) We confirm that the valuer does not have a pecuniary interest that would conflict with a proper valuation of the interest in the property.

• (i) 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.

Yours sincerely CBRE Valuations Pty Limited

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Tom Burchell Certified Practising Valuer Director - Agribusiness Valuation & Advisory Services

Tim McKinnon Certified Practising Valuer Senior Director - Agribusiness Valuation & Advisory Services

Liability limited by a scheme approved under Professional Standards Legislation.

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Summary Letter
Property – “Merriment Aggregation” Various Addresses Via Forbes NSW 2871
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14 June 2018

CBRE Valuations Pty Limited ABN 15 008 912 641 Level 34 8 Exhibition Street Melbourne VIC 3000 T 61 3 8621 3333 F 61 3 8621 3330 tom.burchell@cbre.com.au www.cbre.com.au

Mr William Brennan Authorised Representative Duxton Broadacre Farms Limited 7 Pomona Road STIRLING SA 5152 Via Email: will.brennan@duxtonam.com

Dear Sir

Summary of Valuation Report Property – “Merriment Aggregation” Various Addresses Via Forbes NSW 2871

INSTRUCTIONS

CBRE Valuations Pty Limited (“CBRE”) accepted instructions dated 17 April 2018 to prepare a Fair Value Valuation for the interest in the property listed above. The Valuation is to be relied upon for Financial Reporting purposes only and is specifically addressed for use and reliance upon, by the party named above. The Valuation is prepared in accordance with the Australian Property Institute Australia and New Zealand Valuation and Property Standards, having regard to ANZVGN 8 Valuations. The instructions specifically request us to provide our opinion of the Fair Value for financial reporting as at 14 June 2018 of the holding which CBRE undertook as at 10 and 11 May 2018 on the following basis:

1. Fair Value for Financial Reporting purposes only. In assessing the valuation on this basis 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:

2. “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.”

3. The fair value of a non-financial asset is based on its highest and best use to market participants.

CBRE has been instructed to provide a full Valuation Report in addition to this Summary Letter. In accordance with ANZVGN 8, our Valuation Report draws attention to the key issues and considerations impacting value and the report details our Critical Assumptions, General Assumptions, Disclaimers, Limitations, Qualifications and Recommendations. As commercial investments of this nature are inherently complex and the market conditions have changed and/or have been uncertain in recent times, it is considered prudent to consider the entire contents of our Valuation Report. Therefore, we recommend that this Summary Letter be read and considered together with the Valuation Report. We accept no responsibility for reliance upon the Summary Letter. We refer the reader to Duxton Broadacre Farms Limited to obtain a copy of our Valuation Report.

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Summary Letter
Property – “Merriment Aggregation” Various Addresses Via Forbes NSW 2871
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BRIEF DESCRIPTION OF THE PROPERTY

“Merriment Aggregation” is a large scale mixed farming aggregation situated in close proximity to Forbes in the Central West region of New South Wales.

The aggregation comprises three non-contiguous holdings, which are known as “Walla Wallah”, “Cowaribin” and “Merriment”.

The aggregation currently supports a mixed irrigated and dryland cropping/grazing enterprise. The irrigated land primarily focuses on the production of cereal, canola, cotton and fodder crops. The grazing component supports a prime lamb and cattle grazing enterprise.

“Merriment Aggregation” features a total area of approximately 2,934 hectares which includes 498 hectares developed to irrigated row cropping, 1,024 hectares of land developed to flood irrigation and 1,277 hectares of dryland cropping / grazing land. The balance of land, 135 hectares, is remnant vegetation and timbered grazing land.

The aggregation features access to three separate irrigation water sources being, Upper Lachlan Groundwater aquifer, Lachlan Regulated River and Jemalong Irrigation Limited. We do however note that some of the aggregation’s water entitlements are subject to a long term lease-back arrangement and not included in this valuation – refer to critical assumptions.

Structures include numerous dwellings, extensive rural shedding and grain storage facilities.

A summary of the holding is provided below:

SUMMARY
Property Name	Property Address	Area (ha)
"Walla Wallah"	1372 Lachlan Valley Way, Jemalong NSW	1,459.52
"Cowaribin"	Lachlan Valley Way, Warroo NSW	939.83
"Merriment"	346WillawangRoad, WarrooNSW	534.70
Total		2,934.05

MARKET MOVEMENT

The holding is valued for financial reporting as at 14 June 2018, while our inspection of the holding was on 10 May 2018 and 11 May 2018. We have assumed that the land and buildings and real estate market conditions remain unchanged between the date of inspection and the date of valuation. The value assessed may change significantly and unexpectedly over a relatively short period of time (including as a result of general market movements or factors specific to the particular property or particular property sector). CBRE is not liable for losses arising from any subsequent changes in value.

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Summary Letter
Property – “Merriment Aggregation” Various Addresses Via Forbes NSW 2871
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CRITICAL ASSUMPTIONS AND RELIANCE ON INFORMATION PROVIDED

A summary of select Critical Assumptions noted in the full Valuation Report are noted as follows:

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 aggregation 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	In an effort to apportion the correct land classes across the aggregation, we have relied upon information
Apportionment	provided by the Reliant Party in obtaining the appropriate areas. We have reconciled the areas provided by the
	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.
Water Access	We have been advised that the Jemalong Irrigation Limited surface water utilised on the “Cowaribin” and
	“Merriment” properties and Lachlan Regulated River General Security irrigation water on “Walla Wallah” is
	currently subject to a sale and lease back agreement and as such is not to be included in this valuation.
	We have therefore requested the reliant party to confirm legal access of surface water to these properties.
	With respect to leased water held in Jemalong Irrigation Limited, we have requested confirmation as to whether
	the Water Share is separately leased to the Delivery Entitlement component of the Water Certificate. We have
	been advised by the reliant party that the irrigation water leases have been structured via Term Transfer thus
	allowing the properties to have legal access to water from Jemalong Irrigation Limited.
	It is an express assumption that the abovementioned is true and correct, should this be found incorrect we reserve
	the right to review our report.
Water Lease	As previously mentioned, a portion of the aggregation’s water entitlements are subject to a long term lease-back
	arrangement and not included in this valuation. These water entitlements are however utilised on the properties.
	A summary of these entitlements is provided below.

Certificate No / WAL	Property	Volume(Ml)	HoldingRef	Category	Source
Certificate No. 421	"Merriment"	1,688	J25C	General Security	Jemalong Irrigation Limited
Certificate No. 422	"Cowaribin"	450	J24F	General Security	Jemalong Irrigation Limited
Certificate No. 423	"Cowaribin"	165	J24B	General Security	Jemalong Irrigation Limited
Certificate No. 424	"Cowaribin"	605	J24E	General Security	Jemalong Irrigation Limited
WAL1995	"WallaWallah"	4,138	N/A	General Security	Lachlan Regulated River

Groundwater & Quality We have been advised that the irrigation groundwater quality varies throughout the aggregation; however we have not sighted any water tests.

“Walla Wallah” has been advised as having suitable groundwater quality for cropping irrigation purposes. It is an express assumption that the verbal advice given is correct. We do however recommend that the reliant party seek to confirm suitability by undertaking an appropriate water test. Noting the aforementioned we have been provided with dated water tests which confirm the verbal advice received during inspection.

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Summary Letter
Property – “Merriment Aggregation” Various Addresses Via Forbes NSW 2871
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With respect to “Merriment” we have been advised that the irrigation groundwater quality is poor and requires “shandying” with surface water prior to application. It is an express assumption that irrigation water has been appropriately “shandied” in the past and that the soil quality is unaffected. We do however recommend that the reliant party seek to verify this via undertaking appropriate soil tests.

Irrigation Infrastructure: Via information obtained and through our property inspection, we have been advised/consider 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.

Certificates of Title We have not been provided with current Certificates of Title and associated Plan searches, as such we have relied upon title searches provided by the client dated March 2017. It is an express assumption that associated Certificates of Title and associated plan searches have not been adversely impacted by any encumbrances / registrations that have occurred since the search date. We reserve the right to review the valuation if any of the information provided is found to be incorrect.

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.

Financial Reporting That there will be no material change in the property market or the property between the date of inspection and the date of valuation.

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Summary Letter
Property – “Merriment Aggregation” Various Addresses Via Forbes NSW 2871
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We have relied upon information provided by Duxton Broadacre Farms Limited.

Our valuation is based upon the most current information available at the time the valuation was prepared. CBRE accepts no responsibility for subsequent changes in information as to market conditions.

In the current market, it is our view that a 6-9 month marketing period may be required to effect a disposal of the interest in the asset assuming a professional marketing campaign.

REPORT CONTENT

Our Valuation Report, in addition to the content noted earlier, contains detailed information and description pertaining to: Instructions; Use and Reliance; Site Details including Location, Legal, Environmental and Town Planning; and Building Improvements. This is followed by a comprehensive Agriculture and Water Market Overview and details of the sales evidence regarded. Finally, the report considers the value and marketability of the property. We again refer the reader of this letter to our Valuation Report for detail in respect of the above items.

VALUATION METHODOLOGY

In arriving at our opinion of market value in accordance with the instructions, we have placed primary emphasis on the Direct Comparison approach.

VALUATION SUMMARY

In accordance with the instructions, we summarise our valuation conclusions for the subject holding as at 14 June 2018 as follows:

1. Fair Value

VALUATION SUMMARY
Property Name
"Walla Wallah"	$8,000,000
"Cowaribin"	$2,800,000
"Merriment"	$2,600,000

“Walla Wallah”

$8,000,000 (Eight Million Dollars), exclusive of GST.

“Cowaribin”

• $2,800,000 (Two Million, Eight Hundred Thousand Dollars), exclusive of GST.

“Merriment”

• $2,600,000 (Two Million, Six Hundred Thousand Dollars), exclusive of GST.

CONSENT

CBRE Valuations Pty Limited provides its consent for the inclusion of the Summary Letter, unaltered and in its entirety to the ASX making recipients of such documents aware of the following liability disclaimers. Any further reference to CBRE, the valuation or the valuer within a public document shall require further express review of the content and our express consent prior to release.

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Summary Letter
Property – “Merriment Aggregation” Various Addresses Via Forbes NSW 2871
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LIABILITY DISCLAIMER

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 or Summary Letter 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 including the ASX Disclosures, other than in respect to the Summary Letter and the full Valuation Report.

• (c) The Valuation Report and the Summary Letter are 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. 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 real estate market subsequent to the date of valuation.

• (d) CBRE has prepared the full Valuation Report and Summary Letter relying on and referring to information provided by third parties 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) References to the Property’s value within the Summary Letter have been extracted from CBRE’s Valuation Report. The Valuation Report draws attention to the key issues and considerations impacting value and provides a detailed assessment and analysis as well as key critical assumptions, assumptions, disclaimers, limitations and qualifications and recommendations. As commercial investments of this nature are inherently complex and the market conditions have changed and/or have been uncertain in recent times, CBRE recommends that this Summary Letter and any references to value within the ASX Disclosure must be read and considered together with the Valuation Report. This Summary Letter is to be read in conjunction with our full Valuation Report dated and is subject to the Assumptions, Limitations, Disclaimers and Qualifications contained therein. We refer the reader to Duxton Broadacre Farms Limited to obtain a copy of the Full Valuation Report.

• (f) No responsibility is accepted for any loss or damage arising as a result of reliance upon the Summary Letter and the full Valuation Report.

• (g) Neither this Summary Letter nor the full Valuation Report may be reproduced in whole or in part without the prior written approval of CBRE.

• (h) We confirm that the valuer does not have a pecuniary interest that would conflict with a proper valuation of the interest in the property.

• (i) 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.

Yours sincerely CBRE Valuations Pty Limited

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Tom Burchell Certified Practising Valuer Director - Agribusiness Valuation & Advisory Services

Tim McKinnon Certified Practising Valuer Senior Director - Agribusiness Valuation & Advisory Services

Liability limited by a scheme approved under Professional Standards Legislation.

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Summary Letter
Property – “Wyalong Aggregation” Various Addresses Via West Wyalong NSW 2671 & Forbes
NSW 2871
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14 June 2018 Mr William Brennan Authorised Representative Duxton Broadacre Farms Limited 7 Pomona Road STIRLING SA 5152

CBRE Valuations Pty Limited ABN 15 008 912 641 Level 34 8 Exhibition Street Melbourne VIC 3000 T 61 3 8621 3333 F 61 3 8621 3330 tom.burchell@cbre.com.au www.cbre.com.au

Via Email: will.brennan@duxtonam.com

Dear Sir

Summary of Valuation Report

Property – “Wyalong Aggregation” Various Addresses Via West Wyalong NSW 2671 & Forbes NSW 2871

INSTRUCTIONS

CBRE Valuations Pty Limited (“CBRE”) accepted instructions dated 17 April 2018 to prepare a Fair Value Valuation for the interest in the property listed above. The Valuation is to be relied upon for Financial Reporting purposes only and is specifically addressed for use and reliance upon, by the party named above. The Valuation is prepared in accordance with the Australian Property Institute Australia and New Zealand Valuation and Property Standards, having regard to ANZVGN 8 Valuations. The instructions specifically request us to provide our opinion of the Fair Value for financial reporting as at 14 June 2018 of the holding which CBRE undertook as at 10 May 2018 on the following basis:

1. Fair Value for Financial Reporting purposes only. In assessing the valuation on this basis 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:

2. “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.”

3. The fair value of a non-financial asset is based on its highest and best use to market participants.

CBRE has been instructed to provide a full Valuation Report in addition to this Summary Letter. In accordance with ANZVGN 8, our Valuation Report draws attention to the key issues and considerations impacting value and the report details our Critical Assumptions, General Assumptions, Disclaimers, Limitations, Qualifications and Recommendations. As commercial investments of this nature are inherently complex and the market conditions have changed and/or have been uncertain in recent times, it is considered prudent to consider the entire contents of our Valuation Report. Therefore, we recommend that this Summary Letter be read and considered together with the Valuation Report. We accept no responsibility for reliance upon the Summary Letter. We refer the reader to Duxton Broadacre Farms Limited to obtain a copy of our Valuation Report.

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Summary Letter
Property – “Wyalong Aggregation” Various Addresses Via West Wyalong NSW 2671 & Forbes
NSW 2871
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BRIEF DESCRIPTION OF THE PROPERTY

“Wyalong Aggregation” is a large scale dryland cropping holding situated in proximity to both West Wyalong and Forbes in the Central West region of New South Wales.

The holding comprises two separate aggregations, which are known as “Timberscombe Aggregation” and “Kentucky Aggregation”. Both aggregations include extensive frontage to the Newell Highway with “Timberscombe Aggregation” being situated in proximity to West Wyalong and “Kentucky Aggregation” being situated in proximity to Forbes.

“Wyalong Aggregation” currently supports a dryland cropping enterprise and includes a total land area of approximately 14,347 hectares across both “Timberscombe Aggregation” and “Kentucky Aggregation”.

“Timberscombe Aggregation” includes approximately 8,432 hectares of land with 7,850 hectares considered arable. The balance of land, approximately 582 hectares, is considered to comprise remnant vegetation and timbered grazing land. Structures include 3 habitable dwellings, extensive rural shedding and grain storage facilities.

“Kentucky Aggregation” includes approximately 5,914 hectares with 5,278 hectares considered arable. It is noted that approximately 367 hectares of the arable land is developed to flood irrigation, however is considered a dated configuration and is not currently in use. The balance of land, approximately 636 hectares, is considered to comprise timbered grazing land and remnant vegetation. Approximately 811 megalitres of Jemalong Irrigation Limited (General Security) surface water is included in the valuation. Structures include 2 habitable dwellings, extensive rural shedding and grain storage facilities.

A summary of the holding is provided below:

"WyalongAggregation"
Property Name	Property Address	Area (ha)
"Timberscombe Aggregation"	Newell Highway, Back Creek NSW	8,432.26
"KentuckyAggregation"	Bewleys Road, WirrinyaNSW	5,914.39
Total		14,346.65

MARKET MOVEMENT

The property is valued for financial reporting as at 14 June 2018, while our inspection of the property was on 10 May 2018. We have assumed that the land and buildings and real estate market conditions remain unchanged between the date of inspection and the date of valuation. The value assessed may change significantly and unexpectedly over a relatively short period of time (including as a result of general market movements or factors specific to the particular property or particular property sector). CBRE is not liable for losses arising from any subsequent changes in value.

CRITICAL ASSUMPTIONS AND RELIANCE ON INFORMATION PROVIDED

A summary of select Critical Assumptions noted in the full Valuation Report are noted as follows:

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 aggregation is unaffected by any road alteration proposals.
Approvals/Permits	All Council approvals and permits have been obtained for the existing development.

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Summary Letter
Property – “Wyalong Aggregation” Various Addresses Via West Wyalong NSW 2671 & Forbes
NSW 2871
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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
	the 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.
Water Access	We note that the irrigation – flood land situated to the north on “Kentucky Aggregation” is currently not in use
	for irrigation (used for dryland cropping only) and is an outdated configuration. We have been advised that
	the Jemalong Irrigation Limited surface water can still be accessed on the property.
	It is an express assumption that the abovementioned is true and correct, should this be found incorrect we
	reserve the right to review our report.
Certificates of Title	We have not been provided with current Certificates of Title and associated Plan searches, as such we have
	relied upon title searches provided by the client dated March 2017.
	It is an express assumption that associated Certificates of Title and associated plan searches have not been
	adversely impacted by any encumbrances / registrations that have occurred since the search date. Further, we
	assumed that there has not been a change in ownership.
	We reserve the right to review the valuation if any of the information provided is found to be incorrect.
Water Licences	We have been advised that approximately 811 megalitres of Jemalong Irrigation Limited (General Security)
	and 24 megalitres of Jemalong Irrigation Limited (Stock & Domestic) water is to be included in the valuation.
	We note that the licences were previously registered to Wyalong Rural Investments, then recently changed
	ownership to Merriment Rural Investments Pty Ltd (related entity to the reliant party) and are now in the process
	of being changed to Duxton Broadacre Farms Limited, however we have been advised to include same in the
	“Wyalong Aggregation” valuation.
	We have not received copies of the associated licences for 90 megalitres of the 811 megalitres Jemalong
	Irrigation Limited - General Security on “Kentucky Aggregation”. We have been advised that this water is under
	the ownership of Merriment Rural Investments Pty Ltd and is now in the process of being changed to Duxton
	Broadacre Farms Limited and to be included in this valuation. We have only been provided with an extract
	detailing the 90 megalitres of Jemalong Irrigation Limited - General Security water, which is summarised below:
	 30 megalitres of Jemalong Irrigation Limited – General Security via Holding Reference W1006.
	 35 megalitres of Jemalong Irrigation Limited – General Security via Holding Reference W1011.
	 25 megalitres of Jemalong Irrigation Limited – General Security via Holding Reference W1012.
	It is an express assumption that the abovementioned water entitlements are to be included in the valuation,
	should this be found incorrect we reserve the right to review our report.
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.
Financial Reporting	That there will be no material change in the property market or the property between the date of inspection
	and the date of valuation.

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Summary Letter
Property – “Wyalong Aggregation” Various Addresses Via West Wyalong NSW 2671 & Forbes
NSW 2871
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We have relied upon information provided by Duxton Broadacre Farms Limited.

Our valuation is based upon the most current information available at the time the valuation was prepared. CBRE accepts no responsibility for subsequent changes in information as to market conditions.

In the current market, it is our view that a 6-9 month marketing period may be required to effect a disposal of the interest in the asset assuming a professional marketing campaign.

REPORT CONTENT

Our Valuation Report, in addition to the content noted earlier, contains detailed information and description pertaining to: Instructions; Use and Reliance; Site Details including Location, Legal, Environmental and Town Planning; and Building Improvements. This is followed by a comprehensive Agriculture and Water Market Overview and details of the sales evidence regarded. Finally, the report considers the value and marketability of the property. We again refer the reader of this letter to our Valuation Report for detail in respect of the above items.

VALUATION METHODOLOGY

In arriving at our opinion of market value in accordance with the instructions, we have placed primary emphasis on the Direct Comparison approach.

VALUATION SUMMARY

In accordance with the instructions, we summarise our valuation conclusions for the subject holding as at 14 June 2018 as follows:

1. Fair Value

VALUATION RECONCILIATION
"Timberscombe Aggregation"	$28,750,000
"Kentucky Aggregation"	$18,200,000

“Timberscombe Aggregation”

$28,750,000 (Twenty Eight Million, Seven Hundred and Fifty Thousand Dollars), exclusive of GST.

“Kentucky Aggregation”

$18,200,000 (Eighteen Million, Two Hundred Thousand Dollars), exclusive of GST.

CONSENT

CBRE Valuations Pty Limited provides its consent for the inclusion of the Summary Letter, unaltered and in its entirety to the ASX making recipients of such documents aware of the following liability disclaimers. Any further reference to CBRE, the valuation or the valuer within a public document shall require further express review of the content and our express consent prior to release.

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Summary Letter
Property – “Wyalong Aggregation” Various Addresses Via West Wyalong NSW 2671 & Forbes
NSW 2871
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LIABILITY DISCLAIMER

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 or Summary Letter 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 including the ASX Disclosures, other than in respect to the Summary Letter and the full Valuation Report.

• (c) The Valuation Report and the Summary Letter are 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. 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 real estate market subsequent to the date of valuation.

• (d) CBRE has prepared the full Valuation Report and Summary Letter relying on and referring to information provided by third parties 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) References to the Property’s value within the Summary Letter have been extracted from CBRE’s Valuation Report. The Valuation Report draws attention to the key issues and considerations impacting value and provides a detailed assessment and analysis as well as key critical assumptions, assumptions, disclaimers, limitations and qualifications and recommendations. As commercial investments of this nature are inherently complex and the market conditions have changed and/or have been uncertain in recent times, CBRE recommends that this Summary Letter and any references to value within the ASX Disclosure must be read and considered together with the Valuation Report. This Summary Letter is to be read in conjunction with our full Valuation Report dated and is subject to the Assumptions, Limitations, Disclaimers and Qualifications contained therein. We refer the reader to Duxton Broadacre Farms Limited to obtain a copy of the Full Valuation Report.

• (f) No responsibility is accepted for any loss or damage arising as a result of reliance upon the Summary Letter and the full Valuation Report.

• (g) Neither this Summary Letter nor the full Valuation Report may be reproduced in whole or in part without the prior written approval of CBRE.

• (h) We confirm that the valuer does not have a pecuniary interest that would conflict with a proper valuation of the interest in the property.

• (i) 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.

Yours sincerely CBRE Valuations Pty Limited

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Tom Burchell Certified Practising Valuer Director - Agribusiness Valuation & Advisory Services

Tim McKinnon Certified Practising Valuer Senior Director - Agribusiness Valuation & Advisory Services

Liability limited by a scheme approved under Professional Standards Legislation.

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