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7 <br /> a. bruce 801 8th Street-Suite 220 <br /> & ASSOCIATESJOHNSON <br /> (970)356-6110 <br /> ....... FAX(970)352-8761 <br /> LAND RESOURCE SPECIALISTS <br /> April 1, 2015 <br /> Dale Trowbridge <br /> Lower Poudre Augmentation Co. <br /> 33040 Railroad Ave. <br /> Lucerne, CO 80646 <br /> Dear Dale: <br /> This letter is in response to your request for an opinion letter of market value for New Cache La <br /> Poudre Irrigation Company shares as well as Cache La Poudre Reservoir Company shares. <br /> I am not a Licensed Real Estate Appraiser, however, I am a licensed Real Estate Broker who <br /> specializes in the Brokerage of irrigated farm properties and water rights in the Poudre River <br /> drainage area. The attached Exhibit A"Assumptions and Limited Conditions"and Exhibit B <br /> "My Qualifications"may be significant. <br /> As you well know these shares seldom sell separated from the historically irrigated farm. <br /> There have been a few transactions over the past 3 years where entities have contracted with a <br /> farm owner to purchase the water providing the Seller signs a"dry up"affidavit to no longer <br /> irrigate the subject land with water from these subject companies. Buyers calculate the historic <br /> use of these water rights and with hydrological models determine the consumptive use of the <br /> specific water used on that specific farm. <br /> When all of that is calculated the value for the 4 farms I am aware have all come in about the <br /> same per share. I believe most farms under your system have more or less the same water shares <br /> per acre of irrigated land and therefore explains the similar sales price. <br /> I do not know of a sale of these water shares after the"dry up"purchase and completed"change <br /> of use"court case. That is because the purchaser has encountered an extensive time, legal and <br /> engineering costs to make all of this happen. They are not speculators,but actual users of the <br /> required water. Therefore, my sales are at the time of"dry up" sale. <br /> Shares of the New Cache La Poudre Irrigation Company have sold for the equivalent of$40,000 <br /> to $42,500 per share while the Cache La Poudre Reservoir Company have been steady at <br /> $20,000 per share. There has not to my knowledge been a sale in the past 6—9 months. I <br /> believe with the big increase in the Big T prices, it will be a short time before much higher prices <br /> will occur with the subject water shares. This jump in the market may be at least 25—30%. <br /> Farmers are NOT wanting to sell, thus the price must be a lot higher to pry them loose. <br /> -0011 <br /> Colorado-Nebraska-Wyoming • Farm&Ranch • Water <br /> Sales • Exchanges • Minerals • Consulting <br />