Rivco Australia Ltd ($RIV)

Okay. Thank you, everyone. The time is now 10:02, and I would like to welcome everyone to the 9th Annual General Meeting of Rivco Australia Limited. A very warm welcome to those in the room with us today and to those who have dialed into the live stream. My name is Brendan Rinaldi, Independent Chairman of Rivco Australia. To those familiar faces in the room, it is a pleasure to eat again and host today's meeting of the Board. This year, we have 4 of our directors up the front of the room. Chris Larsen was unfortunately not able to be here in person. So you can see him up on the screen. We're hoping here at some point. So I think the people are working on it. But just a quick piece of housekeeping, if you haven't really please ask you to turn your mobile phones to sale. Thank you. To commence proceedings, I would firstly like to introduce board members, Dr. Vivienne Brand here on my right, Mr. Stephen Duerden, Mr. Ed Peter and our Company Secretary, Katelyn Adams is in apology, but we have Jake here in her absence. Chris Larsen will join shortly on the screen. So please bear with us there. And we've got Lachlan Campbell and Lachlan Beech from our management team in the front row. You can read more about each of our Board members in the company's latest annual report. I'd like to set sincere thank you to our Board and management team for their dedication and hard work over the last 12 months. Your collective efforts have been instrumental in delivering a number of key milestones for the company, which we'll speak about at today's meeting. I advise that in accordance with the company's constitution, a quorum is present. In accordance with the Corporations Act, I advise that the notice of Annual General Meeting was dispatched to all shareholders on the 18th of March 2026. Accordingly, I declare the meeting properly stand open. Turning to the formal proceedings of today's meeting, we'll be following a structure similar to last year. I'll begin with an update of the progress we've recently made over the past 12 months. I'll then cover off on the F '25 performance, the completion of the internalization and speak about our evolving capital management framework. -- each will speak to the portfolio performance, followed by Lachlan Campbell, who will talk to the outlook and wrap things up. After that, we'll address the formal items of business, including with any shareholder questions. I kindly ask that you hold any questions until we reach the designated section of the meeting. Before we move on, when you registered to that meeting, you should have been given either a blue pink or white attendee card. If you have not received this card, please go to the registration desk outside the men to get one. Only those holding blue attendee cards are entitled to speak or ask questions at today's meeting. If you receive a blue card, this will be used for voting in the polls, which will be opened at the end of the meeting. Where a proxy vote has been given to the Chairman without voting instructions, the Chair intends to vote in favor of the resolution. The Corporations Act and the company's constitution empowers a chair to call for a poll on resolution put to a general meeting. Today, I call a poll on each of the resolutions to be considered at this meeting. As a quick update, earlier this morning, the company announced that Mr. Dirk Wiedmann has retired from the Board, which was effective immediately. Dirk has made a meaningful contribution to the company for over 9 years is playing an important role in the significant transformation of internalizing the company and establishing its new corporate identity. The Board extends its sincere thanks to Mr. Wiedmann's dedicated service and lasting contribution to the company. In light of this recent development, which we also announced to the ASX this morning, the Board has withdrawn resolution of today's meeting. Before I take you through the financial results, I would just like to speak to some of the significant items and in particular, the transformation that has taken place within the company over the past 15 months and why that transformation matters to you, our shareholders. Over this period, your Board has engaged in a disciplined and deliberate process of listening to you, our shareholders. And -- sorry, just lost my spot. And the feedback we received was clear, and it was consistent. You told us that external management structure was not fit for purpose for a company of our scale and ambition. You expressed concern that our gearing levels were elevated and created unnecessary risks the portfolio. You call for greater independence at the Board level, and you made it clear your expectation of a coherent transparent pathway to sustainable long-term returns. We heard you. We agree with you, and we have acted with urgency and accountability. I want to be quite direct in saying to you that words and opinions carry little weight. What matters is the evidence. And I'm pleased to report that the evidence is unambiguous and that the majority and certainly the key commitments we made to you have been met and in several cases, exceeded. However, we firmly acknowledge that we still have a lot of work to do and some aspects are continuing as a work in progress. The milestones, I will now outline are not isolated improvements. Each one was a deliberate response to shareholder feedback, executed with discipline and verified by the results. Taken together, they represent a fundamental and lasting repositioning of Australia. The internalization -- so following shareholder approval at the May 2025 AGM, the company completed its transition to a fully internalized management structure in November 2025. This was a watershed moment for Rivco. We now operate in a much simpler, more scalable structure, one that eliminates external management performance fees entirely and one that ensures the interest of our management team are fully aligned with those of shareholders. We have undertaken a substantial and deliberate reduction in debt, bringing down borrowings from approximately $116 million to $20 million, reduced our leverage from 31% to approximately 7% and the transformation of the company's risk profile that affords us considerably greater financial flexibility as we look to the period ahead. Our lease water entitlement percentage has increased from 37% to 66%, and the company is progressing confidently towards a stated target of greater than 17% by 30 June 2026, and we may even be closer to the top end of our target of 18%. This shift underpins a more predictable recurring revenue base and is central to our strategy of delivering consistent returns through the cycle. Furthermore, our weighted average lease expiry has moved from 2.8 years to 3.1 years and moving towards target. I assumed the role of Independent Chairman on 1 June 2025, succeeding Mr. Ed Peter. We've also welcomed Mr. Chris Larsen to the Board as an Independent Non-Executive Director. These appointments strengthen the independence and depth of experience at the level, and I'm confident they will serve shareholders well. Recently, we also farewell Mr. Dennison, who served on the board for over 9 years as well as Mr. [indiscernible] our founder and [indiscernible] along with Mr. Dirk Wiedmann, who has retired from the Board as of this morning. The Board maintained its dividend commitment throughout the year conducting a comprehensive review of the dividend framework, which is continuing, and I'll speak more to that shortly. The ongoing strengthening of the company's governance structures and leadership capability remains a standing priority for the Board. And against the backdrop of all the structural change, I'm proud to report that the company has delivered a record financial results for the year ended 31 December of 2025. Profit before tax reached $33.5 million, earnings per share of $0.14 and representing a 133% increase on the prior year. Total shareholder returns for the period were 15.8%. These are the results which the Rivco team can be genuinely proud of. More significantly, they've been achieved in a year where the company has undergone a material restructure and all the costs associated. This record financial result was achieved after absorbing all one-off costs associated with internalization. We reported a net profit before tax of $33.5 million for 2025, which was an increase of 152% on the prior year [ $61.3 million ]. Net profit after tax was $21.9 million compared with $9.3 million in FY '24. The underlying performance was driven by improving yields -- on the company's high security water assets, active management of unleased allocations and the realization of profits from water entitlement sales to the Australian government under the Federal Government's water buyback program. Earnings per share of 14% represents 133% increase on the prior corresponding period. A result that reflects both operational excellence and the accretive impact of the structural changes undertaken during the year. I would like again to acknowledge the contribution of every member of the Rivco team on these results, which we are reporting today, which are a testament to their dedication, expertise and commitment to creating long-term value for our shareholders. From a net asset value perspective, our pretax NAV increased to $1.75 per share during FY '25, representing growth of $0.10 over the course of including our dividends paid, this equates to a total NAV return of 12.9% for the period. It is worth noting that water entitlement values were broadly flat during FY '25. The strong NAV performance was, therefore, primarily attributable the team's capacity to return through that sale of entitlements at prices above prevailing market values, which is a reflection of the company's deep market relationships and active management. The company also held approximately $5.3 million of unleased order allocations during December 2025, which is carried into this financial year to nil cost base. We have continued to realize this into the market in early '26, providing additional earnings support for the year. We continue to monitor water entitlement markets for well-priced acquisition opportunities in zones that are couple to our existing portfolio. FY '25 marked the successful completion of 2 land market share, the internalization of management and the transition of the company's name and identity to Rivco Australia Limited. The internalization approved by shareholders at the May '25 AGM has been implemented smoothly and with it. All one-off costs associated recognized in FY '25. The internalized structure is expected to reduce total operating costs from approximately $3.6 million per annum under the previous management model to approximately $2.6 million on a like-for-like basis, implying a recurring cost of approximately $1 million per annum with no performance fees. Beyond the financial benefits, internalization has delivered important qualitative improvements, a more scalable business model, a more transparent operating structure and meaningfully stronger alignment between management drivers. On our rebrand, the trending from Duxton Water to Rivco Australia reflects the company's evolution and its identity as an independent Australian-focused water business. The response from our investors, our customers and other key stakeholders has been encouraging, and the Board believes this new identity positions the company well for the future. The significant reduction in the company's debt position represents one of the most consequential steps taken during FY '25. Total borrowings were reduced from $116 million to around $20 million, with our leverage declining from to 7%. This deleveraging was funded principally from proceeds received through the order entitlement sales to the government. Total interest expense for the year was $3.2 million compared with $6.7 million in FY '24, which was a reduction of 52%. With a material lower debt position heading into FY '26, this reduction in interest costs will continue to benefit shareholders. During the first half of 2025, the company also need market share buybacks totaling 1.6 million shares at an average price of 50 per share. Purchasing shares at a discount to NAV is accretive on a per share basis and reflects the Board's commitment to disciplined capital allocation. The company paid 2 fully franked dividends totaling $0.0743 per share during '25, up from $0.073 per share in the prior year. Since the company's first dividend payment in November 2017, total dividends of $0.524 per share have been returned to shareholders. I'm pleased to announce that the Board has declared a fully franked final 2 dividend of $0.0372 per share be paid to all eligible shareholders on 30th of April 2026. Looking ahead, the Board intends to evolve the company's dividend framework with effect from October 2026. Under this revised approach, dividends will be primarily underpinned operating earnings. Realized capital gains from the sale of our entitlements will be assessed on a case-by-case basis and subject to prevailing market conditions and strategic priorities. They may be allocated in whole or in part to reinvestment in additional water entitlements, further debt reduction on market share buybacks or supplementary dividend payments. This framework is designed to enhance the sustainability and discipline of our capital returns while preserving the flexibility to deploy capital in the most accretive manner available with the overarching objective of rising total shareholder returns over the medium and long term. Further detail on the specific parameters of the revised dividend framework will be communicated to shareholders in the month ahead. Ladies and gentlemen, on behalf of the Board, I want to express my sincere appreciation for your continued confidence in Rivco Australia. The changes we have made over the past 12 months are structural and enduring a reflective commitment to building a company that is simpler, more transparent, more aligned and better positioned to generate long-term value for all shareholders. I'm very proud of what this team has achieved in a year of significant change. I'm confident that the foundation we have laid will deliver meaningful benefits to shareholders in the year ahead. I will now hand over to our portfolio executive, Mr. [ Locke ] Beech, who will provide you with an update portfolio. Over to you, Locke.

Thank you, Brendan. For those of you who haven't met me, my name is Locke Beech, and today I'm going to cover off on portfolio performance, diversification, leasing and provide a water market update. Following this, I'll hand over to my colleague, Locke Campbell, who will take you through an outlook and wrap things up. The key theme for FY '25 has been active management of our portfolio. During the year, we completed a number of acquisitions and disposals as part of our ongoing strategy to the portfolio. In total, we sold 18.1 gigaliters of high-security entitlements and esters security entitlements for a combined total of $143.4 million. These transactions generated $38.7 million in realized capital guidance by far the strongest result in the company's history. And for context, on the screen, there's a chart that shows the realized capital gains for each year since inception. These sales were executed at prices materially above carrying value, which resulted in a significant uplift in NAV and contributed strongly to our 12.9% total NAV return for the year. Entitlement market conditions were mixed throughout the year and the Ricardo entitlement index increased 0.7% in the first half of 2025 before declining by 1.5% in the second half, resulting in a net annual increase of for the full year. Importantly, this highlights the value of an actively managed portfolio rather than simply holding assets passively. As I've mentioned in the past, a key pillar of our strategy is diversification, both within our portfolio of water entitlements and within our portfolio basis. The portfolio is diversified across regions, entitlement types and security classes. With the shift to dry conditions over the last 12 to 18 months, company's high-security entitlements have become the primary driver of returns, reinforcing the importance of portfolio diversification. Meanwhile, our general security assets provide more upside in average to work conditions. Importantly, the portfolio has been 80% weighted to higher security entitlements, which typically performed better in more average to dry conditions. As a result, we believe our portfolio is well positioned for the current environment. So to summarize, the key takeaways of diversification are diversification of security classes and regions is paramount. Scale is key and having strong relationships with our lessees, customers and other market intermediaries such as brokers remain critical to our strategy going forward. Turning to leasing. This has been one of our key focus areas over the last 6 to 12 months. The company's leasing revenue for FY '25 totaled $5.8 million with 54% of the portfolio locked into long-term leases at the end of the year. While this is up from 37% at year-end 2024, we've been actively working towards increasing our lease percentage for the years ahead. We've seen a clear increase in demand for leases and water security as Irrigate is positioned for the current drug conditions. Looking ahead to the water year commencing 1 July 2026, we have approximately 71% of our portfolio committed to leases and forward allocation contracts. This includes $8.3 million of lease revenue and $830,000 of forward contract revenue, totaling approximately $9.2 million of committed revenue. On a high security basis, that's approximately 78% of those assets being committed. Our target is to increase our committed percentage further in the coming months, and we have a pipeline of opportunities that we are progressing and lease rates are now improving to around that 5% to 6% per annum for most major high-security entitlements. Increasing our lease percentage and weighted average lease expiry provides greater earnings visibility and stability supporting more consistent and predictable income profile for our shareholders. Turning to water entitlement market update. Over the long term, water has delivered a compound annual growth rate of approximately 7% since 2007. This reinforces our investment thesis and highlights our view that water is an attractive, defensive and uncorrelated asset. Government buybacks continue to play a role in absorbing entitlements from the market. The Australian government actively acquired late water entitlements during 2025. At 31 December 2025, approximately 221 gigaliters have been recovered towards the 450 gigawatt target, leaving around 230 gigaliters still to be recovered by 31 December 2027. The government has indicated that it expects to reach approximately 400 gives by the end of this year 2026 through existing and expanded buyback programs. In respect of FY '25 specifically, the values traded relatively flat. The strong returns this year was primarily generated from selling assets at above book values, not from capital growth in the underlying assets. That said, in early 2026, which since -- we started to see improving transaction activity and stronger pricing coming through on select high security parcels driven by tightening supply conditions and increase in demand for water security. I'll now hand over to Locke Campbell, who run you through our outlook. Thank you.

Thank you, Locke, and a warm welcome to everyone this morning. My name is Locke Campbell, and it's great to be presenting once again at our Today, I'll share with you some insights into where we believe are in the current cycle before providing an update on recent share price performance and our key priorities for 2026. So I want to start with dam storages as these are the single most important supply side indicator in our market. Dam storage levels determined how much water is available for agriculture each year and they directly influence the yields that we can generate off of our assets. The table on the screen tells a clear story. At 31 March, the weighted average Southern Basin storages sit at 42% capacity. While this is lower than the long-term average of 51%, interestingly, it is broadly comparable to what we saw in early 2019. For those who followed water markets, early 2019 is a significant reference point. That was the period leading up to when we saw Lower Murray spot prices surged to over $1,000 per megaliter during the last trough. Now I'm not here to say that we are absolutely heading for a repeat of 2019. But what I can say is that the storages today look very similar to what we saw in 2019. So therefore, spread in flows in the coming months will be critical in determining and influencing what the spot price does in the year ahead. If we see an average or wetter winter, storages can replenish the market may ease. But if conditions remain dry, supply will tighten and that is historically when the value of high security water entitlements has most clearly been demonstrated. And this is exactly why we've been focused on building our lease book, increasing our recurring revenue and extending our way and securing water for our customers in advance of may be another dry period. This table represents how much water has been allocated to entitlement holders so far this year. When allocations are low, there is less water available in the market, which tends to push spot prices higher. And as you can see, awarded allocations as of early 2026, and are again early similar to what we saw in early 2019, particularly across [indiscernible] Systems. As of March 2026, the combined average annual allocation determinations are sitting at 52% compared in early '19. Now adding to this, South Australia announced earlier this week that its expected minimum opening allocations for 1 July 2026, are expected to be 62%. This would be the first time this entitlement type hasn't opened at 100% since 2019. And before that, it was the millennium drought. So these are just really some key reference points that market stakeholders should have in mind when thinking about the year ahead. The key difference today though is that Rivco is better positioned than it was in no management or performance fees that scale with NAV, a high proportion of lease entitlements at attractive yields and a stronger balance sheet to take advantage of attractive opportunities should they present. Just quickly on this chart. So this shows how allocation prices have moved over the last 9 to 10 years and how the current dry conditions have translated into higher spot prices. Again, going back to 2019, allocation prices in the Lower Murray reached $1,000 per megaliter. Prices then reduced significantly in the years ahead, driven by a prolonged wet period with prices falling to as low as 5 regulator in '22 and '23. Recent dry conditions and lower storage levels have contributed to upwards pressure on spot and lease prices with the Lower Murray reaching as high as $550 per megaliter earlier in the year and while it since dropped to about $400 per megaliter, the current trajectory reinforces the strategic value of water ownership and our ability to help farmers secure access to water in -- allow them access to water in a capital. Now beyond water markets, this slide highlights how recent strategic actions are beginning to translate into positive performance. Over the past 12 months, we've seen improved share price momentum and a meaningful narrowing of the discount to NAV. Our discount to average used from 15% at the end of January 2025 to just 1% at the end of January 2026. That being said, we believe global market volatility has been a factor impacting many small cap share prices in the last couple of months, leading to a slightly higher discount of late, but we believe the trend is clear. We believe recent positive share price momentum has been driven by the cumulative effect of the strategic actions Brendan mentioned earlier: internalization, deleveraging, increased lease percentage and greater engagement with our shareholders in the investment community. We remain focused on continuing our efforts to narrow the gap between NAV and the share price. Looking ahead to 2026, this slide sets out the 5 areas where the Board and management will be directing their attention and energy. First, increased earnings stability by continuing to grow lease percentage was 70% or above to enhance recurring cash flow and reduce earnings volatility. Second, portfolio optimization, rebalancing capital into high income, high-growth loans using a selective valuation led approach. Third, disciplined capital management, ensuring we deploy capital to the highest risk-adjusted return opportunities while still preserving flexibility. Fourth, leadership and governance finalizing our leadership structure and continuing to enhance board capability in composition. And fifth, refining our investment proposition. We're currently or we'll be launching an updated investment thesis, which we will clearly communicate and clearly communicate our future strategy to the market in due course. We are excited about the year ahead and confident that Rivco is well positioned to deliver long-term value for shareholders. Now before going to the formal items of business, I'd like to invite Ed to say a few words. As shareholders may be aware, Ed will be stepping down from the Board at the conclusion of today's meeting. Over to you, Ed.

Thank you everybody I'll keep this brief, but I did want to take a moment to reflect what we've accomplished and where we sit today. When we started this business, it came from an idea, funny enough, on very rainy dark day in the Adelaide Hills. I was poring the train. I was sitting in the office prior afternoon, Peter Michell and I had opened the bottom line, and we're sitting there and we're talking about the way balance sheets and companies work and the allocation of capital and what's good and what's not we're talking about farms. And we're talking about the fact that a farming balance sheet, if you set it up the right way, can actually have a lot of upside. And that water as part of that balance was a very stable boring regular thing. It was almost 2 different risk buckets. And that's where the idea of this company was more and was the fact that the water part of that balance sheet is a nodding boring wonderful patient asset. For those of you who are not up on term events, they're happening today, Iran and the U.S. are beating on each other and thumping each other and we may have a piece in the next couple of days. But this asset in that environment is about as can get. I've said over the years many times that we would see an inflationary period. And I am at this point in time, absolutely sure that we're going to see a nasty out of stagflation inflation, but with the nongrowing economy. We've hit over 90 processing plants, refineries for those of you who don't know a processing plant. In the Middle East, we've locked out in one fell swoop, 14% of the global production of based fertilizers. So we're going to see ag inflation as well. And if you look at just the other is to the economy, it's roughly 32% to 34% of the fertilizer compound going to get whacked. So we will see inflation through food. We're going to see it though energy. We're going to see it through the fact that we don't have helium to make computer chips at all. That said, a real asset like water has nowhere to go up in that environment. We will adjust with farm prices. We will adjust as a hard asset, even though this is a theoretical asset. Now when Peter and I sat down that we discussed how this should perform in different types of environments, you couldn't get a better environment for this asset, much less with the background right now that we probably will go into a and you've got the government that's going to take out another 200 gig of water. For me, I can't be prouder of my team. The 2 Lockes who came in behind in the years and the Tall Willow and an accountant for Campbell have done nothing short of extraordinary things as you can see from the compound growth rates over the last 8 and 7 years actively. And as 2 bright articulate wonderful young man, I cannot say enough good things about them. They've proven me right repeatedly. And I'm very happy that they are in the positions that they are and taking care of this portfolio. From my side, the fact, Peter Michell was crazy enough to believe in creating this company. I will always debt for. And for the fact that he's pushed me, in fact, to say let's make this happen a couple of times. So we actually we spent 1.5 years of work to get the company build. Starting off with $37 million, it was very small. And for those of you who've been here since the very beginning, thank you. And hopefully, you feel boringly well rewarded. From my side, I want to thank my fellow board members, I'd like to thank especially Dennis who is not here and Peter who is not here. And I'm absolutely sure that going forward, company will do great boring things for you. For on, we've had a little bit of a difference of view on how do we grow. From my side, I've been very, very clear. I think we stay very boring, but we'll see what happens with that in the future. And to all of you who have been here all the way through and put up with me in all the investor meetings, all the little coffees et. al and all my rants and raves, I do appreciate it a lot. So God bless you all. I am officially resigning right the second. I will sign a letter and say goodbye to you all, and happy to have coffee with anybody share views on the economy and everything else. I think we're in for one heck of a rough time, and I think the markets in general, will be having a little bit of a beating. That said, I think this company going to be absolutely fine through that. So thank you all, God bless, and it was a great ride.

Thank you, Ed. It is a great story of how this company was formed. It is a wonderful asset. We do believe in it immensely. And as Ed said, the 2 Lockes have done a tremendous job with where the business is at today. So again, thank you, Ed, and on behalf of the Board and the entire Rivco team, we extend our deepest thanks for your vision, your leadership and your contribution to this company, and we wish you all the best with your future endeavors. I'll now table the notice of meeting, which was made available to all shareholders on the 18th of March. And if there is no objection, I propose that the notice of meeting be taken as I advise that no notice of any other items for today's agenda has been received, and therefore, declare the only matters for our meeting today that can be dealt with are those set out in the notice of meeting. Excluding Resolution 3, which was the reelection of Mr. Dirk Wiedmann, which has been withdrawn by the Board. Shareholders and proxy holders attending today, you should have been provided a blue or pink attendee card at registration. If you have not received an attendee card, can you please see a Computershare representative at the registration desk outside the room. For each resolution, I'll invite questions from you at the appropriate time and those wishing to ask a question in the room, can you do so by please raising your blue or pink card. For those shareholders and proxy holders here in person holding a blue card on the reverse of your card is your voting paper and instructions. We will open the poll after all items in the notice have been introduced and discussed. I will then ask all shareholders and proxy holders holding a blue card to vote on the reverse side of the which will be collected once the poll closes. I will conduct the meeting by referring to the resolutions in the presentation behind me. Should any member have a question with regard to any of the motions being considered, there will be an opportunity to ask questions prior to voting on each resolution. I refer to those matters set out in the notice of meeting. The first item of business today is and consider the annual financial report of the company for the financial year ended 31 December 2025, together with the declaration of the directors. The directors report the remuneration report and the auditors I wish to advise that a copy of the company's most recent annual financial report was lodged with the ASX and is also available for download from the company's website. also have a few lining around in the room if you'd like to grow a hard copy. Please note that the company's auditor, Mr. Justin Humphrey from Grant Thornton, is also present today here in the front room -- front row if you have any questions for him. Justin, you put your hand up please. Thank you. We are not required to formally adopt these reports. However, I invite any discussions or questions in relation to the company's annual financial statements. Please raise your blue or and wait to be acknowledged before speaking. Can we please ask that you state your name prior to asking your question and 1 of our team members will be walking around with a microphone for you. If there is no further discussion, I will now move to the next item. Is there any questions on the annual report itself? No. Okay. We'll move to the Resolution 1, the adoption of the remuneration report. I now inform the meeting that the explanatory notes accompanying the Notice of Meeting and the company's financial statements provide the background and details of the remuneration report. I now move the motion rand if thought fit to pass with or without amendment resolution, as shown on the screen as a nonbinding ordinary resolution. Please note the key management personnel of the company, including the directors and their close related parties are excluded from voting this resolution as set out in the notice of meeting. Also in accordance with Section 250R 3 of the Corporations Act, this resolution is advisory only and does not bind the directors of -- the slide behind me shows the details of votes received by proxy. The directors enormously recommend that the shareholders vote in favor of adopting the remuneration report. For any proxy votes where the chair is nominated as a proxy, these votes will be in favor of the resolution. I now invite discussion of that motion and please raise your blue or pink attend decade if you have a question or comment. Yes, [ Ian ].

Mr. Chairman, my name is [ Ian Gibson ], and I'm here representing my Superfund. Today is our first opportunity to address the Board since in relation to the internalization of the management and the removal of the Capital Australia as the manager. And to be clear, all for the internalization process that occurred. My issue was with the price the price paid. Given the circumstances around the vote, it's reasonable for us to use this forum at the remuneration report to question some of the governance matters around the internalization of the subsequent running of our company. DCA received around $14 million in payments as part of the internalization, which on my simple analysis could have been nil or close to nil if we waited a further approximately 12 months. But nonetheless, this has happened. The internalization was supposed to see the ties to DCA. However, there is an ongoing influence from DCA on our Board today. Mr. Peter has accepted the changed circumstances, and I'm pleased to see he's retiring at the close of the and I wish him absolutely the best. And also the announcement this morning regarding Mr. Wiedmann is another positive development. However, Mr. Duerden has so far failed to see the governance issues of having the CEO remain as a Director of our company. Could Mr. Duerden, please explain what benefits he brings to maintaining a directorship on our company in this time when we're trying to separate ourselves from the former manager?

Yes. Thanks, Ian. I'm happy to answer that. Yes, I have been CEO of Duxton Capital. I've recently stepped down from that position. I'm still employed by Duxton to look after other things. And I would say that I would have been quite happy to go with the water team to Rivco. But I don't think it's too lucky is what we're looking over their shoulder. In terms of my role and what I bring to the board I have always taken the view that if there's been roughly so any conflict between the interest of the manager and the Board or the business that I've recused myself from those discussions as appropriate. And indeed, fellow Board members will confirm that's been the case. I think Brendan is quite happy to stand by that. In terms of what I bring to the business, I've got 20-odd years investment knowledge around agriculture. I come from a background of a family has been in involved in agriculture. I understand the issues around water. I've been involved in it of this business. are very much wedded to the business. I love the business. I think it's a great investment. I've got pretty much my entire family wealth tied up in the business. So I think I can bring a lot to the table in that regard. Also the other boards that are sitting on around agriculture, I've got exposure directly to farmers and irrigators across New South Wales Victoria, South Australia. So that gives me real-time information about what people are thinking about and what they're doing.

I'd like to throw in an on the side. I cannot find a person who has got liberty and who's more honest than Steve. You'll often find them in the office working in 10, 11:00 at night to make sure things work and make sure they work seamlessly. He is in my experience of him in the last almost 20 years, never ever, ever, down. Any time there's been something quickly or difficult, he's gone out and solved it for us as ducks and mortar. More importantly, he brings a deep knowledge base of what's happened to this company all the way through. And he's probably the last person here who's here in inception. So when I step away, the are not here in inception, Vi was not here in inception nor was Brendan. He has lived through every single trade we have done literally physically signed most of them. So from my side and as a also a large shareholder. I cannot speak highly enough about him and his integrity. I think that from my side, I'm very happy to support him as a Board member. I know that many other folks are and I cannot imagine many people with more knowledge of what we do, how we do it and how we process trades in the planet.

May I have a follow-up, please, Mr. Chairman?

Well, I think in terms of what we've said today is we've gone through a refreshed process, and we are working through that. I mean we think who serves on the Board has served it to the best ability. We have had independence on the Board. Steve is one of the founding directors. He does add incredible contribution from a skills-based perspective. And we respect your views as shareholders that -- you see the fact that there has been a payment and a transition and we get that it's part of part of Duxton and was the former CEO. So we get that the view of some of the shareholders is that there's a governance issue there. But As I said, from a skills base perspective, we don't have any issue in the way that Steve's conducted himself, there's certainly no issue as well. He's been an important member of the team, and we're managing through, but we certainly respect the views of our shareholders.

But in terms of severing the ties with the former manager, this is not a good indication up until today, 3 of the 6 directors had broadly in association with the manager. And I might add that in the ASX announcement, where Mr. Peter's resignation occurred, there was a concluding comment that in experience and independence to support the -- sorry, that the Board's balance will be adjusted just to be able to support the ongoing strategy and governance requirements. I'm just not sure that I see how good governance can be maintained when you've got such an influence of the former manager. And I might also add or question, at the next AGM, I believe that Mr. Duerden is up for reelection. Can we have a commitment as to whether he will stand for reelection then or whether he will resign at or before the next AGM.

That's fine. Look, I'm not going to make a commitment at this stage as to whether I'm going to stand or not. I think while ever I can add value, there's a reason for me to stand. I would say I'm not the only director sitting on the board, so it's not like and make all the decisions and suddenly everybody does what I want. Far from it, there's a majority of independent voices on the Board. So I take a bit of bridge to assumption or accusation that somehow I control the Board and the Board is not independent. The Board is very independent. I think what I bring is a long history of exposure to agriculture particular water investment as well as a formal training in finance. So in terms of where we go next year, that's clearly up to the shareholders. I appreciate there's a number of you in the room who have significant shareholdings and you can vote those as you see fit. But I will always do the best by the company as a significant part of my family's wealth is tied up in this company. So certainly want to see it achieved.

Good morning, everyone. My name is [ Red Purvis ]. I represent IPG management. We're a substantial long-term shareholder in the company. My question is a follow-up for another 1 for Mr. Duerden, Mr. Duerden until recently, you've served as the CEO of Duxton Capital and the Director of Duxton Farms. At the Duxton Farms AGM in late 2025, shareholders delivered what can only be described as a significant review or over 73% voted against the remuneration report, constituting a first strike under the Corporations Act. Over 80% rejected the proposed increase in direct fees and the proposal to issue equity under listing a was also defeated. 3 of 5 resolutions were rejected outright. We note that the Takeovers Panel received formal applications in connection with the merger of unlisted Duxton entities, although they did not proceed with that investigation. And that the independent expert found that, that merger was not fair to shareholders. As a Director of Duxton Farms and as the CEO of its management company at the time, you had governance obligations in respect to these outcomes. Do you consider the governance outcomes at Duxton Farms to be relevant contact for shareholders, assessing your fitness on continued role on the Board.

Thanks, Red. It looks like I'm fairly popular today. Look, it's not my intention to talk about Duxton Farms, clearly, without the other directors here, but I welcome the opportunity to reject what you've put and perhaps give a more detailed explanation to the room as to the circumstances surrounding that. Firstly, on alleged government failures, I will acknowledge the takeover was indeed a very takeover transaction. It involve multiple entities, multiple boards and different shareholder bases. We weren't going to please everybody. To confirm the transaction was run independent directors of all of those boards. And I excuse myself from all the debate around that transaction, both from Duxton Farm's side and on the company side because I was sitting on both sides of the fence. So I stepped back completely. I had no involvement in the due diligence processes in the pricing or in any of whether to proceed or not. And just to confirm on that, parties related to Duxton as the manager were prohibited from vote on that merger transaction. So just to be clear, we followed very much first principles in terms of governance. The Board of Duxton Farms went to great pains to ensure that there were appropriate governance and controls around that transaction. And I'm happy to introduce you to the partner, [ Clayton Utz ] that sat across that transaction and made sure we followed everything not only to the letter but to the of the law. In addition, and I point out the transaction was vetted by ASIC and the ASX in terms of the -- approving the documents before they were dispatched to all the shareholders of Duxton Farms and the acquired entities, and that's a requirement under ASX listing rules and obviously, ASIC. Given it was a scheme of arrangement structure where we needed everybody in the room basically approve the transaction, the transaction documents were even approved by the Federal Court before they were dispatched to shareholders and after shareholders had approved them. Yes, I acknowledge there was an application of the Takeovers Tribunal, which any shareholder who doesn't agree with the takeover is permitted to do. The takeover panel did not see merit in that application. And again, happy to provide you with written advice that was received from the Takeovers Panel. In terms of the fair and reasonable opinion, we had or I should say, the independent directors of the Board, Farms had RSM acting as the independent directors for the shareholders of Farms. And technically, you are correct, the opinioned that the takeover offer was not fair but it was reasonable. And the reason why they said they couldn't opinion that it was -- that they couldn't opinion that it was there, was that in assessing the assets that were acquired that are obliged to assess those assets at the net tangible asset value not at their business value. And then if I can quote from the independent expert's report, we consider that the acquisition of portfolio assets with high-growth potential for primarily equity consideration, together with the diversification of business activities and the risks that the acquisitions provide gives rise to greater advantages to nonassociated shareholders disadvantages. So absolutely, we followed not only the letter of the law, but the spirit of the law in that acquisition. In terms of the AGM that you raised, yes, there was a vote against the directors remuneration proposal. and the remuneration report at the AGM. I note there's probably about a 20% vote -- 20% of ASX-listed companies had to vote against the remuneration report last year. We've spoken to 1 of the major shareholders behind that vote. They've indicated their support for the Board going forward. And they also voted to support the transaction and actually provide funding for the transaction. So I hope that the issue.

Probably the biggest problem with the transaction was valuing bees because there's no land associated with bees. As I tried to explain to Phil, the bee business, which we are currently coequal biggest in the country, it's a uniquely difficult business to value because it's high of 60,000s. And how do you attribute value to that contribute to a box, but not to a hive. So you have to do it on forward earnings. So it can be very difficult to say, this is land, and this is bees. So that was the real crux of that question. Now I can explain it to you later if you want.

I should have mentioned that these questions were submitted in writing or the company beforehand. So thank you for your response. We ask that they be entered into the minutes fullness within 14 days. Happy to chat I just wanted to ask a follow-up on that. The challenge we see Mr. Duerden, is that 1 event on its own is maybe questionable and something into. But when we consider the recent IMA expiry scenario and accelerator, this raises more questions for us and we start -- a patent starts to develop. The IMA, the investment management agreement with Duxton Capital, which you were the CEO of was due to expire in July of this year, only 14 months after internalization was proposed, the Board was required to put a termination resolution to shareholders at the end of May in mid-2026. So why did the company pay $14 million to terminate a contract that was contractually scheduled for shareholders for termination anyway? The independent export report Model 2 scenarios the first internalize immediately for $24 million to $29 million, all continuing to perpetuity into to $38 million to $48 million. The export did not model what was the most obvious scenario allow the IMA to expire, save $14 million and internalize at minimum cost. The meeting acknowledged this option existed, but dismissed is unfeasible with our detailed analysis. As the CEO of Duxton Capital and as a board member, you said on both sides of this transaction, receiving $14 million of aids and shares and a Director of Rivco while making those payments. We would like you to explain why the Board did not present this lower cost option to shareholders and to confirm whether DCA or its representatives made any representations to the independent directors about the consequences of allowing the IMA to simply expire.

Thanks, Red. And again, I acknowledge that you did give a heads up there that you're going to ask me some tricky questions. But look, I think to be clear, I think we -- the intended directors address this last year. I'm quite happy to go back through that. First of all, to be clear, I didn't sit on both sides of the transaction. Again, both Ed and I excuse ourselves from those decisions. And in fact, it was the independent directors that brought the decision to Ed and I as the representatives of the manager over time. basically terminate the contract and in source of business. So at no point did I participate in those deliberations and that was all done separate Board meetings that didn't involve myself or Ed. And at no time did we deliberate in the quantum of what was decided. And by the way, it was about $12.5 million, not $14 million.

Sorry, the annual report has $13.6 million.

I can show you it was about $12.5 million. So it probably depends on how the last management fee was paid of the last month. Basically, the transaction was put to the managers from the independent Board as to we think this is the best way to go. So there wasn't room from outside for negotiation. So I don't think that by any means we set and said, we think payers. The independent directors came to us having been -- having had advice from BDO [ Korda Mentha ], who did their financial modeling and Allan's and [ Stoneberg Panini ], legal partners who advised them. And they brought the transaction to us and said, look, this is the way we want to move the business forward. And obviously, the majority on the board. We agreed to work with them we accepted that they wanted to cancel the conduct. Obviously, there was a termination price in that. And then we agreed to work with them on the transition. Now can I just point out that I understand what you're saying is why don't we just run out and then off we go to the races. Duxton spent considerable time building this business and we ran the office. We provided the accounting and financial support. So all the costs over the last 10 years have been paying for the business -- we've been seeing a management fee. But the reality is that management fee barely if, in actual fact, didn't cover the cost of running that business. And you can see that, I think Brendan mentioned today, -- the cost -- internal costs of $2.2 million in a year. So that gives you an idea of what it does cost to run this business. So having said that, we agreed to work with the independent directors to transition across the IP that we have built across all the IT systems to encourage the staff to move across. So we paid staff out incentives and long-term bonuses that came out of our pocket. There were also some staff redundancies that we paid out. And then in addition to transferring the IP the IT, the hardware. We transferred across, as I said, the staff, the accounting team, all the financials and then arranged with the 2 Lockes, looking at the internalization of things like things running a business, your HR, legal, your IT support, transitioning them into new offices, all things that we've provided over the last 10 years. So -- and as part of that process, so picking that whole business up and basically moving it across in Duxton and giving them the tools and to run the business. Then in addition to that process, there was also a requirement that Grant Thornton provide a review of that transition directors. And then the independent directors themselves have to sign off on that transition to satisfy themselves that the business had been successfully moved across. So -- and again, I can't stress enough, I think if you look at the results in that last 12 months and bearing in mind that Duxton was responsible under that transition even from the date of termination, which was back in May of 2025 right up to the end of November, when we finalized the transition, we were responsible for the supervision and management of the portfolio. And in that -- in those 12 months or 11 out of the 12 months, we've actually record profits for the business. And I think if you look over the 10 years that we manage that business, we returned something like $65 million in dividends, which is quite $0.53 a share. We had an annualized return of 9.7%So I think I get -- initially, you would look at the business, and you'd say, well, I should just pass it across. I think current staff out to the wasn't just getting rid of clunk. You got to get staff who didn't have the right to go. -- normally, it would just rolled over the contract. And we worked in good faith trying and internalize the goal was long-term internalized when the company was a little bigger. The flip side of that was everybody is worried that there might be another big performance fee because we're going into dry, so we still let's just go forward and take the buck out of the any minutes there and just move forward and try and work in good faith. So everything we did was in faith, and I didn't want to do it. but in the end since everybody else did bank.

Look, I appreciate the response. So I guess the question that it opens up to us is around you mentioned the complexity of the business cost of the business and its requirements. I mean the TSA, I think the transition services agreement is a good example of actually how simple this business really is. It was supposed to take 18 months. It was done in 6 months. DCA would then receive a bonus on top of that.

They built -- the guys came out and said, "Let's give you an incentive to move quicker to make it easier. And so that's what their intent was. They said, "Look, we'll do it this way. But you need to make sure it works. They took a window, said, this is the short, this is a long, let's try and make it happen faster, so we're going to incent you to do it." So we did from Duxton side, the best we could to make sure it was seamless, it worked and everything got carved out. A bunch of people didn't want to come. A bunch of the employees that were there didn't want to come. And so we had sort of who's coming, who was not and give a business that goes on forever. Now in terms of friction costs, they're very low comparatively if you're going to buy this business, you'd pay a lot more. the guys from Regal and they came and pitch to me to buy the business, off of us, we're talking much higher numbers. So when Brendan, what's his name, the CEO of Regal came and pitched me. He was talking well about that. So ended up having the cost of moving this was much lower. And we tried to do our best for everybody.

The rest of my questions -- Ed, can I just finish my question for Stephen, just a follow -- just as the CEO of DCA, so you had a financial interest in triggering that payment of an accelerated TSA. And as a Director of Rivco, you had a duty internalization was genuinely complete and materially declared. At the time of that early completion, 6 months in, the company adds to our understanding to direct employees, no publicly articulated independent strategy, no discrete capital framework. The TSA contemplated an 18-month transition to deliver a fully operational independent company. Can you confirm the exact dollar around DCA received under the accelerated levers? What specific deliverables DCA completed to justify that early termination and confirm what governance safeguards were put in place to prevent you as a person who still depended financially from influencing the timing of that internalization determination. And do you accept that the accelerator course created a financial incentive for DCA to declare completion prematurely that given every month of completion increased DCA's effective fee?

Yes. I think I addressed that earlier. But basically, we didn't have -- well, I say Duxton didn't have a say in when completion was finished. That was up to the independent directors to assess the business -- they brought in Grant Thornton to do a financial review as well. So it wasn't a case of Duxton goes with finished Jack. And in terms of the staffing, the way that we agreed to approach it was to give 2 Lockes, obviously, key management personnel, some security around their role going forward. we agreed that we would move them into business straightaway. And as part of that, is I hope you don't mind, we paid out their long-term incentives that they had earned within Duxton -- and then we continue to work around moving the -- all of the business in, as I say, transferring across the IP that have been developed over those years, moving the IT systems across and then working with other staff. And as there were a bunch of staff, some who wanted to go and some didn't want to go -- in the end, we came up with an agreement as to who was moving across, and they moved across just prior to transition. And again, Duxton paid out their long service leave their historical balances, their bonuses, et cetera. And then we also manage some of the staff that remained remain redundant. -- we had IT staff leave as part of that process because obviously, we had a full IT team supporting the water business. And we had another analyst worked with the team that left as well. So it wasn't a case of, in any way me or Ed or anyone in Duxton going, yes, look, we finished check, it really came down to the independent directors be satisfied. And again, I get to the point the whole issue around this was trying to do this quickly and efficiently so that we had minimal disruption to the business. And I think we achieved that by the record results that we achieved for the year ended December 2025, which Brendan has just stepped through. So I'll leave it at that.

Mr. Chairman, my understanding the restraint clause in the transitional services agreement prevents DCA, Mr. Peter and Mr. Duerden from competing in water entitlement space for only 18 months from June 2025, meaning that the restraint expires around December this year. After that date, there's no contractual barrier to stop Duxton Capital, Mr. Duerden or Mr. Peter from reentering the market and leveraging the formation that they knowledge that they've gained whilst being directors of our company. Can I then ask how is it reasonable that Mr. Duerden continue as a director at the limited restraints and particularly the envisage being a director up and beyond the actual expiry of those restraints at the end of this year?

Thanks, Ian. I hope to take that. Look, as I say, I've stepped down from the CEO of the Duxton Capital business. Having said that, yes, there is a restrained trade for 18 months. I think it's quite reasonable that I would step down from this Board if we were to go and enter into another listed in the remote chance that we enter into some sort of a water business similar to this business. I think it's quite reasonable that I would step down. I can't see me being a 2 businesses that were operating in the same market.

Is it only restricted to an ASX-listed water? So in theory, you could go and start a private water business?

We could start a private one. I can't see that reemphasize is my governance query.

We want farms all over Australia. We buy and sell water for those farms. So it's not a...

This is an inherent conflict.

Look, as I said, I'm quite happy to reconsider that position if we get to that remote possibility where we start up another business. It took us 10 years to grow this business. And to be frank, wasn't very profitable for us. So I can't say certainly in the immediate future, I can't. I don't have a crystal ball. But as I said, I'm not involved with the CEO of the Duxton Capital business. But I can't -- I can take your point, Red, and I'd be quite happy to step down.

Thanks, Ian and Red, for your questions. So voting on this resolution will now be held over until the conclusion of the final item of business to allow the poll to be conducted. Resolution 2. I'll now move to Resolution 2, election of Director, Mr. Chris Larsen. More background can be found in the explanatory notes. I now move the motion to consider and if thought fit to pass, with or without amendment, the resolution out on the screen as an ordinary resolution. The slide behind me shows the details of the votes received by proxy. Each of the directors will increase who obtains recommend shareholders vote in favor of the region for any proxy votes where the chair is nominated as a proxy, those votes will be cast in favor of the resolution. I now invite discussion of that motion. Please raise your blue or pink attendee card if you have a question or comment.

Mr. Chairman. Firstly, I congratulate you on finding someone of Mr. Larsen's experience to join our Board. My only question -- and I'm sorry if you can't see us or hear us.

I think you can hear us for some reasons on screen.

My question directed to you then perhaps or to some of the other people on the -- Congratulations, Chris. So my question is whether Mr. Larsen has any historical relationship with either Mr. Peter or Mr. Duerden, and have they previously worked together capacity?

Yes, thanks for your comments there before. I think yes, I have worked with it many, many years ago. our time at Deutsche together. And -- but we haven't worked for more since then. I think that my memory serves, in 2007.

Any further questions on Chris' appointment? No. Voting on this resolution will be held over until the conclusion of the final item of business to poll to be conducted. Resolution 3 as per my previous remarks, Resolution 3 has been withdrawn from the action of the items of today's meeting. So we'll move on to Resolution approval to issue securities under an incentive plan. I'll now move to Resolution 4, approval to issue securities under an employee incentive securities plan. More background can be found in the explanatory notes as well as the clarification that was lodged with the ASX on the ninth of April. Following the company's internalization, the Board has established a remuneration framework personnel comprising fixed annual remuneration, short-term incentive and a long-term incentive, each with measurable objectives the performance of the company. Components of the STI are delivered in restricted rights and the LTI is delivered entirely in performance rights designed to align the interest of management with shareholder outcomes. The board wishes to make clear that the maximum concept of 3.16 million security stated, this resolution represents an approval ceiling only. It does not reflect any present intention to securities up to that number. The Board has deliberately adopted a conservative approach seeking authority equivalent of issued capital, which is well within the ASX approval limits. I now move the motion to consider and if thought fit to pass, with or without amendment, the resolution as shown on the screen ordinary resolution. The slide behind me details the votes received by proxy. The directors unanimously recommend the shareholders vote in favor of the resolution. For any proxy votes where the chair is nominated as proxy in favor of the resolution. I now invite discussion of that motion or any questions. If you please raise your hand if you have a question or comment? Yes, Ian.

Don't like to be dominating.

That's all right.

Mr. Chairman, I have absolutely no issue with an incentive plan for company executives. Indeed, I think they're critical to retain people of the caliber of our 2 Lockes. My issue is the size of the request under resolution my expectation would be that a few hundred thousand shares per annum might be appropriate given the size and scale of our business. And you're suggesting that you're being conservative in only seeking approval for 3.2 does not seem conservative to me. And given my overall concerns about governance, I don't know how the Board can justify seeking 3.2 million securities with next to no detail about whom, how vesting et cetera. Can you please justify the quantum in particular and the details surrounding this resolution?

Yes. Thanks, Ian, for your question. And it's a common question. That's why we sort of announced the clarifying statement on the ASX on the 9th of April. And we've obviously had discussions on that. with several shareholders. Yes, as you know, we internalize the company. We've got our own starts now. We went through a process of putting in a framework for the team, which is considered best practice. It does consider short-term incentive and long-term incentive. You're right. There's no intention. I guess our word conservative is probably flipped the other way around. It really is a conservative number. We don't expect to get anywhere near that conservative in that respect, not conservative the other. So it's probably just the terminology there, but I think you're right. It's a 3-year approval. So the initial feedback from us through our lawyers drafted this was a 5% figure of placement. We said, well, that's too much to reduce it to 2. We honestly didn't think it was to be that much of an issue because of the immaterial nature within this, it was just putting a percentage in there. So we respect your views, but it's entirely driven to incentivize our staff the long-term incentives that are sort of governed by restrictive rights and performance rights, which are, as you'd expect, tied to absolute shareholder return and total relative shareholder return. And we have established since internalizing a remand noncommittee is the chair of. Vivian was the prior chair until she's taken over as Chair of Arc and Chris has taken on that. So the usual process will be through the rem and noncommittee for construction approval and then it goes board for approval as well. So we have set that up in place. Again, I appreciate the number in isolation looks big. And we have committed to disclosing under our disclosure requirements, what that actually looks like in due course.

Thank you, Brendan. I just wanted to come back to that comment earlier about the remuneration of related parties. It sits at $8.9 million and [ $0.7 ] million together, which is approximately over $13 million, almost $14 million, if that's not correct, then the annual report, it will need to be reviewed.

Just so I can confirm, that would include the management fee for the 2025 year.

Yes. So the 5 months before. Okay. So it's not 14, it's 13? That make asset management fee still is still too much.

Just with regards to the LTI, we're asking shareholders to approve 3.2 million shares, roughly $5.7 million at NAV for a business the size we are, that's a significant amount of money, especially for 1 that has 2 people, 2 FTEs. So unless it's and with no disclosed KPIs and no exercise price and a full board discretion to wave conditions, what is the one specific performance metric that will be attached to these grants if they were issued?

So one specific, as I said, for LTI, for example, it's a 40% both most. It's part of that is total shareholder return on an absolute basis and total relative shareholder return to the ASX 300 constituents over a 3-year period. So that's -- like I said, it's designed under best practice. I take your point -- we're in the process of restructuring and setting out the company. It's the same as requested an increase in director fees of in here as well, which will be the next resolution. It's not our intention to go out and spend that money straight away. We're trying to set the company. We don't know what the structure is going to look like in 2, 3 years' time. We have put it in place as a measure. So if we grow the company, if something happens, those measures in place that we can attract key executives into key roles and put something in place today. Like I said, in isolation, the number is large. We're just looking forward and like our view of conservative is probably the opposite view of core to do. But we're just saying we're putting it in place that we can keep the business moving.

Brendan, if you don't, I don't mind if I can just add a couple of points here. Just to clarify, there's 4 full-time employees not just the 2 Lockes. In the Duxton business, when we were running it, there were significantly more employees. We have a much bigger business. Obviously, being a small business sitting on its own doesn't have the ability to manage that overhead. So things like HR, legal, IT are all outsourced to keep costs down. So that's why at the moment, it's a in-house team -- it's quite likely that as the business grows that that will bring some of those outsourced services into the business. it actually makes sense from an economic perspective. I would say, internally, when it was all in Duxton, there was a full IT support crew there. supported them, the HR, legal, et cetera. So at the moment, I don't think -- and I think everyone agree that business isn't big enough million to support all those people. But obviously, going forward, once it makes economic sense, we'll look to in-house that.

Thank you, Red. Voting on this resolution will be to the conclusion and the final item of business to allow the poll to be concluded. Resolution 5 approvals increase nonexecutive director fees. Again, more background can be found in the explanatory notes I'll now move the motion to consider and if thought fit to pass, with or without amendment, the resolution as shown on the screen as an ordinary resolution. As set out in the notice of meeting, all the company's directors and their associates are excluded from voting in favor of this result -- the screen is showing those votes received by proxy for any open proxy votes where the chair is nominated as a proxy, those votes will be cast in favor of the resident. I now invite discussion of that motion, please raise your blue or if you have a question. Go ahead.

Thank you, Mr. Chairman, again. In my opinion, this resolution should not be overly controversial However, once again, my concerns lay around the historical governance issues. Page 36 of the annual report includes a footnote saying that no fees were paid or are payable to Mr. Peter and Mr. Duerden, since the termination of the transitional service agreement therefore, they received no director fees. Can you confirm that no fees have been paid or payable in 2026 to both these gentlemen and that the $14 million we paid to them is sufficient concession?

Yes, confirming. So Ed is retiring. So certainly, they have not received a director fee since the termination. Maven -- the thanks. And as far as Steve goes, I think it's December.

I haven't taken directors' fees since the day the business was listed and agreed that I won't take them up and the theoretical termination of what the transition -- the full 18 months of that transition period. We thought that was very reasonable. So I have for 10 years like that, clarify on that.

Voting on this resolution will now be held until the conclusion of the final item of business to allow the poll to be conducted. Resolution 6, renewal of proportional takeover provisions. More background can be found in the explanatory notes as this is a special resolution. I note that in order for it to pass it requires approval of 75% of the votes cast by shareholders on this I now move the motion to consider and if thought fit to pass the resolution shown on the screen as a special resolution. The slide behind me shows the details of votes received by proxy. A proportional takeover bid is a takeover bid in which the offer of each shareholder is only for a proportion of their shareholders' interest in the shares. The company's constitution includes provisions that enable the company to refuse to register shares acquired under a proportional takeover unless a resolution asked by shareholders approving the offer. Under the Corporations Act, these provisions explains renewed by a special resolution of shareholders. Accordingly, the directors consider the shareholders should have the opportunity to vote on the renewal of the provisions in the constitution. The explanatory statement outlined pendants and disadvantages of the renewal of the takeover provisions and on balance, the directors consider the possible advantages out big the possible disadvantages such that renewal of the proportion of takeover provisions are in the best interest our shareholders. The directors, therefore, unanimously recommend that shareholders vote in favor of the resolution for any open proxy votes where the chairs nominated as proxy, those votes will be cast in favor of the resolution. I now invite any discussion of that motion, please raise your blue or pink card if you have a question or comment. Okay. Voting on this resolution will now be held over until the conclusion of the final item business to rate call to be conducted. Sorry, [ Greg ].

Having heard the answer to some of the previous questions can ask a question. I've heard variously that the water business is dull and boring. We talked about the fact that the business wasn't large enough yet to fully staff up in a number of the functions are outsourced. The good news is that it is being set up and built for scale, and there is a revised payout framework in place that's focusing on dividend out of earnings. My question is really the general one is to -- in this dull and boring business, it's built for scale, what are the potential catalysts for growth that you do see that might make it not dull and boring, might take advantage of the fact that it's built for scale and that we may see growth outcomes in the future?

Spoken to a lot of our shareholders about where they think we should on strategy, a lot of people do. I think we should just continue to be a boring, strong, solid asset investment, and they feel as though they can get diversity through other things. We're consistently looking at all opportunities whether that's in water infrastructure, whether that's in consulting, whether that's anything within that water sphere, but ultimately, our core -- we want to stick really strong to our core. And at this stage, that's what we're doing. But yes, it's -- water is such a critical asset to culture to -- we saw one of the listed companies yesterday really great win for them, which is providing town water up in the Pilbara, which will be extremely profitable for them. So this whole thematic around water isn't going away, and there's a lot of opportunity. The theme at the moment is data centers and how much water they use. There's going to be plenty of scope for water into the future. All we can say, Greg, is we'll look at every opportunity as it comes up, assess it. I think the key thing for shareholders at this stage and the key feedback was, if you do diversify, have a level of risk, we don't want you to go out and do anything super crazy that goes away from the core strategy. So like I said, we'll look at it I think given where we are in the market to echo Ed's comments before, we are very well placed, given just everything that's happening with government water buybacks going into a dry period, the supply-demand modeling that's been done as part of our net thesis shows that it's simply in a driver. There's simply not to irrigate all the permanent plantings there. So we don't find it boring as such. Otherwise, we wouldn't be here. We get pretty excited by being able to find opportunities in the market. and look all credit to the team. I know we can point to the government buybacks and say we had a win through all this. But we were the first big corporate to get from the government because we're easy to deal with because we pitched at the right price and because we pitched the right assets to diversify our portfolio to get it in the best shape going into the next period. And I've said that we've got our lease percentage up from 37% to 66%. That's because of the composition of our portfolio. And we sincerely hope to be in a position to come out from 1 July to say we're in that 70% to 80% bracket, which we said to shareholders from day 1. So on the outside, it might seem boring, but to the inside, we're pretty excited by water and its importance. Any further questions? Okay. We might -- Resolution 7, approval of additional 10% placement capacity -- as this is also a special resolution. I note that in the order for it to pass, it requires the approval of 75% of the votes cast by shareholders on this resolution. I now move the motion to consider and if thought fit to pass with a net the resolution shown on the screen as special solution. The ability to issue new shares under the additional 10% placement capacity will enable the company to issue shares in circumstances where it might otherwise be subjected to the cost delay and uncertainty of having to go back to shareholders I should mention here that should this resolution be passed, it does not necessarily mean the company will raise capital in mind with the resolution. The directors believe that the resolution is in the best interest of the company and unanimously recommend that shareholders vote in favor. The screen is showing those votes received by proxy for any open proxy votes where the chairs nominated as proxy, those votes will be cast in favor of the resolution. I now invite discussion of that motion. Please raise your blue or pink card if you have any questions. Ian?

Mr. Chairman, once again, this resolution should not be controversial. However, given the Board's willingness to significantly overpay for internalization of the internal management structure, I'm concerned about giving the Board unseated ability to issue an additional 10% placement capability on top of the existing 15% limit, what assurance can you provide that the nature and circumstances under which you would utilize the ability to issue 25% of new shares as part of the transaction? And I might add that I'm not liking your concepts of diversifying into consulting and water infrastructure and agriculture more generally.

Well, we're certainly not doing that, and I just said there's things out there that we could consider. We're not looking at doing anything outside of the core business at this stage. So in relation to trust, and I've heard, I guess, on a few times that the view that we've overpaid and I think I think we probably just -- we've addressed that enough last year. It was part of the AGM last year. The concept of internalization, I think it's important to overlay the governance method that has been by the independent directors. So the 5-year process, we ran an independent review through onset to review the performance of the 5-year mark done by the independents. That review showed that performance was better than peers in the market where we can get information, you would be familiar with some of those and the fees were in line or better than market as well. So there was a tick at the 5-year mark. We had some feedback from some advisers that back in 2024 when our share price was to a and the government was to again start buying up a lot of water that it could be a potential opportunity to raise capital. The feedback was that there was memories shareholders that we couldn't grow any further unless we're internalized. That came from the market come from these guys. So Dirk and I went in that with several key shareholders with one of our advisers, and I apologize that we missed one of our key shareholders in that process with [ RPG ] but we did go to 5 of our top shareholders, and we asked them to some of their views, and it went beyond that as well in a second round. So when I talk to things like we move from external management to internalization, we moved the debt from 31% to 7%. We've moved icon. This was all the feedback we got. You're externally managed your debt is too high, your lease percentage to our recurring income to -- you don't have an independent chair. You don't have a sustainable dividend. So we've taken all that feedback on board and we're trying to go through it step by step. We can't fix everything overnight. Key thing in, stabilize the business, get the business in great shape. We have got the business in the best shape it's ever been. We appreciate we have to do things and earn the trust of shareholders. I appreciate you think that payment was large. That payment we had I hope you don't mind me saying you we had after [ Cortiment ] did their work after we did negations because it's a negotiation, we had to negotiate with TCA. We question them as well. We put it through advisers that said it's in line with market precedents. And I think we shared some of those market precedents with you. There was -- if we wanted to genuinely internalize the business, we had to have a vote to that, and we got for that. And we went and sat down with shareholders and we explained them through our process for getting to a number. In terms of internalizing quicker than some thought we should, Ed thought it should be a 3-year process. We said it should be 6 months process We landed at 18 months. And so we want it done in 6 months. So we'll incentivize you to work, you bought off to try and get it done in some. So there's been a very structured process there. as Steve mentioned, we've had Allan's advice around the whole independence of these guys because they're sitting on both sides of the fence, but we've excluded them. We've had our legal counsel from [indiscernible] on a lot of our calls to make sure that we're doing everything right, and we got that. We appreciate it's a big number, but we've been able to do all that while still producing a record result for the company. Thanks to the way that the is being set up. So we also heard as part of that feedback, that the other last raise we did to the treasury water was not too much of a discount. So we're listening to shareholders. I can guarantee you that if another transaction comes along or an opportunity, replacement opportunity, we will be vigorously reviewing it and making sure it's in the best interest of shareholders.

So specifically to this resolution, my question is, why should we give untethered ability for you to have 25 ability rather than 15% ability without a vote because having the control of I think a shareholder vote being the determining factor is a great constraint as opposed to yielding untethered ability to achieve 25%?

Yes. It's a good question, Ian, but I think we have set the company up. I think we're doing everything shareholders are asking Obviously, we're not pleased every view in the room, but we did get the approval. Most of our shareholders are in favor of what we're doing. I appreciate that's not all of them. And the first slide I put up around governance, things like that, it's still a work in progress. Like I said, we know we're still going to earn the trust of some of the people that have some questions, and we're committed to doing that, and we're committed to getting our governance in the best place that we can. And that's through what we've done internalized the company it has down he retired from the Board. Dennis retired, we brought increase. I know you asked the question, does Chris know Ed. But Chris has been brought in on purpose, and Chris is a fantastic addition to the board. You out, but that was designed specifically to replace capability and skills. So we are committed to building you the best board we can with an appropriate skills matrix and move forward from there.

So Brendan, if I can just add. Look, I appreciate your concern. I said I invested a significant part of my personal wealth in this business. So as a shareholder, I'd be very concerned about potential dilution that from a placement like that. I think the thing we can point to is that historically, when there have been placements done, there's been a pro rata offer the other shareholders, so to make sure that there's an opportunity to participate. I can't speak for the Board, but from my own personal position, I would expect that we would continue with that approach.

David?

David Adams. You mentioned at the last AGM, there was a vote about internalization. Did the majority of shareholders approve that internalization? And what percentage if it was?

Yes, David. It was about at over 60% voted in favor and obviously, the remainder against. Thanks, David. Any other questions? Okay. So, voting polls are now open. We will now vote on all resolutions included in the Notice of Meeting, and I declare the poll open. I appoint the Computershare representative is [ Gemma Kosha ] to be the returning of it and conduct the poll. Gemma has the power to co-opt as her agents, members of our staff and staff of the company. Over to you, Gemma.

Thank you, Brendan. Firstly, if there is any person present who believes they are entitled to vote but has not registered to vote, would you please raise your hand for assistance? The persons entitled to vote on this poll are all shareholders, representatives and attorneys of shareholders and holders who hold blue admission cards. On the reverse of your blue admission card is your voting paper and instructions. I will now go through the procedures for filling in the voting papers for resolutions 1 to 7 with the exception of Resolution 3, which has been withdrawn. If you are holding a proxy, your admission card includes a summary of proxy votes, which outlines the voting instructions provided by the appointing shareholder for each resolution. By completing the voting paper when instructed in a particular manner, you are deemed to voted in accordance with those instructions. In respect of American votes, a proxy holder may be into cast, you need to mark a box beside the resolution to indicate how you wish to cast your open votes. Proxy holders should refer to the summary form attached to your voting paper for further information. Shareholders also need to mark a box beside the resolution to indicate how you wish to cast your votes. Please ensure you print your name where indicated when you have million in voting paper, please lodge it in a ballot box, which will be circulated to ensure your votes are counted. If you require any assistance, please raise your hand. Would you please indicate by raising your hand if you require more time to complete and lodge your voting paper? [Voting]

Thanks very much, everyone. We shouldn't be too much longer than just to the finishing things up.

Thank you. That's all complete. Back to you, Brendan.

Okay. I now declare the poll closed and formally charge the returning officer account votes. Votes will be tallied, and the results will be available at the ASX announcements platform following this meeting. As there is no further business, I declare the meeting closed. We will now take some general questions from the floor unrelated to the business of the meeting. Can we please ask that you raise your hand, state your name prior to asking the question. And once you have been acknowledged. One of our team members will offer you a microphone. Yes.

Hi. My name is David Wolfe. I'm a shareholder. Just going back to your initial opening, you mentioned that you made quite a substantial debt reduction on water buybacks through the government. I'm just asking myself given the demands a lot of people are making on government finances in this day and age, if you have any contingency plans in place for what should happen that has changed in some way. The government don't have so much to spend wallet?

It's a good question, David. I think the government seems to be committed in all the states seem to be committed as well to see this through with the latest round of 450 gig of purchasing. They just announced a new tender the Northern Basin. So I think all indications are that I'll see it through. But you're right, they've still got a long way to go. They've still got to get the tender -- sorry, do the expressions of interest, get the tender, go to contracts make payment. So anything that will happen, but I think all indications at this stage are that the government is fully committed to committing fulfilling their government buyback process. So I don't know if you want to add anything to that, but I think probably all we can foresee at this stage. Thanks, David. Now we don't have a crystal ball. Yes, yes, it's an important question you raise even considering a crystal ball moment is what happens, you take 450-gig out of the system. I think some of the supply-demand modeling sort of shows last time I did a big buyback after that prices came down. But then when you take that much water out of the system, and we know there's still so much demand, perhaps prices go up. I mean we have seen prices plateau, as we showed in the presentation across 2025, and it was similar in 2024. So prices certainly have run, but we do need to consider all the elements when thinking about strategically what move we make next to it. Yes. Thank you, David. Any further questions? Yes, Greg?

Still interested in the outlook question. Steve, capital hasn't made it not coming to life to make out of Duxton water. And whilst I can appreciate the uncorrelated diversionary benefit water in my investment portfolio. I'm just trying to think out longer term, should I just think of it as a reliable dividend payer that's not correlated with anything? Or are there opportunities out there for growth? Should I have some growth in the back of my head as an expectation?

Yes. SP1 I think if you look at -- and can talk to a bit of this as well. But the modeling that's been provided is -- and Lockie Beech spoke to this. Over the last 20 years, we've had -- as in the physical asset has had a growth rate of 7%. And then typically, our returns yield basis or anywhere depending on the year from 3% to 6%. So which shows that the headline figure of this asset class should be in that 10% to 12% bracket less your costs, so as a total return. But we've seen anomalies in the market in the last period when prices should have come down during COVID, interest rates were the cash rate was and prices stayed elevated. And then at the end of that wet period when interest rates started to run, water prices should have dropped off, but then the government came back in and held prices up. So we've seen a few in the market. But if you look at the 20-year horizon the returns are there and the market has been flat. So it hasn't been on a run, and we don't expect it to sort of fall off, like I said, with the demand and the dry outlook, value should improve. So we don't have that crystal ball that David was talking about. But we do absolutely think it's a very strong noncorrelated asset. I've got my own personal super money in water as well. So I think very strong nonvolatile asset that's got a very, very important use to agriculture and their way of living. So for all the reasons states why it's a great asset. And yes, it's typically noncorrelated and it's typically a very good inflation hedge as well. So not always, but generally speaking, it is.

Yes. Greg, if I could just add to that. My family's originally from Sydney or around Sydney. So I have the occasion to do it backwards and forwards. And just from an anecdotal perspective, historically, you used to drive across the hay plain and it was pretty much all cotton -- you drive across there now and you can drive for miles, and it's all permanent crops that require watering every year. So where we used to have farmers making decisions a year about price of water and if there was enough water in the system and trade off against going to get for their cotton crop or putting in a summer grain crop. Now you've got big irrigators out there who have trees that have spent upwards of 6,000 to 10,000 hectare putting in that they have to keep a live for the next sort of 25, 30 years that I'm talking about the nut trees of course. So it doesn't matter what the price of water is. These guys are going to continue to irrigate now we've had the government in there buying back or at the moment, I think they bought back 220 gig, looking at 450. As Brendan said, but I think this government is pretty much committed to doing that. So you kind of -- you can kind of do the math and you just look at the number of permanent crops out there. There's just not the flexibility left in the system to provide water during those drier periods. So I think we're going to see some significant movement in pricing. And we've got a great team on board here that will work in constraints. And I think there's great opportunities for this going forward.

Yes. Even annual cropping, the government completed a vanilla program 6 months ago, $1 billion drought innovation line program, which is a lot of overhead are gates that have gone in, which you'll see if you drive around the country side as well. There's a lot of annual crop irrigation on top of that. So yes, there's demand coming from both sides. Thanks, Greg.

Once a year. So what does that translate to in a vision for the Rivco office? Does that mean that the Lockies are selling bigger chunks at bigger prices chunkier margin? Or do we have a team of 5 or 10 or 20 locks racing around selling water to eager buyers. How should we envisage the office in 5 or 10 years' time?

We'd like to think that's a good vision, Greg. But I think at the moment, like I said, stabilizing the business and getting into a good position. We're firmly on track to get within that 70% to 80% leased bracket. Once we've got essentially a fully leased book that opens the window for us to grow thoughtfully in terms of with demand. So once we're full up, if we're still getting a lot of demand from growers out there to then what a great scenario for us to be in defined water that we can lease straightaway and help grow the team that way. So there is a lot of demand. The guys have done a great job in we have to be come the new auto year, which is in 1 July to have that percentage write up and get ourselves in that position. Lockie, do you want to see any more to that in terms of demand at the moment that you're seeing?

No. I mean some continued -- if you scan the publicly available information on water security of some of the big users -- it's fair to say that they're under secured. So we are getting inquiry on a bigger scale that nowadays because of the amount of permanent plantings that are in. And as you know, if you haven't got water, the tree they either have to hibernate them or they can die. So they either give them less water, which impacts the yield or you don't order them and they can perish. It's pretty important that they secure.

No more questions in the room? Okay. Well, I'd like to thank the members in the room for their attendance today and certainly for all the questions. Please feel free to stay for some light refreshments. And once again, thank you for the interest and support in Australia Limited. And once again, I just want to pay our thanks, big thanks to Dirk to his service on the Board and especially to Ed being the founder and his on the board in setting this company up. So thank you, everyone.