INSPECTION REPORT SUMMARY

PRE-PURCHASE TIMBER PEST INSPECTION REPORT This Timber Pest Inspection Report has been performed in accordance with Australian standard AS4349.3-2000. The report is subject to the scope and limitations exclusions definitions and terms and conditions as defined within the Australian standard This Report has been prepared by PeessttDeecctti ivvee timber pest inspections and the Named Inspector And is supplied to you (the named client) on the basis of and subject to Terms and Conditions of Inspection. IMPORTANT NOTE: having provided to you an opportunity to read or hear the Terms and Conditions following upon you making a booking for the Timber Pest Inspection, the inspector has proceeded to conduct the inspection of the property and to supply this Report on the basis that you have accepted the Terms and Conditions and/or are deemed to have done so upon the inspector arriving at the property and commencing the inspection. CLIENT AND PROPERTY DETAILS Account to: ACCESS PROPERTY SERVICES Po Box 179 SUMMER HILL, NSW. 2130 Phone: 9798 5000 Fax: 9225 9656 Your Ref: Ordered by: Purchaser Your client: Mr NEW HOME Post report to: PO BOX 179, SUMMER HILL, NSW. 2130 Phone: 9226 5318 Email: new home @internet mail.com Property inspection Address: 1 SYDNEY STREET, SYDNEY N.S.W. 2000 SERVICE REQUESTED AS AGREED WITH CLIENT: This Timber Pest Inspection is A VISUAL INSPECTION ONLY in accordance with Australian Standard AS 4349.3 Service Requested: A visual examination of timber and other visible accessible and unobstructed materials/areas (but excluding furniture and stored items) susceptible to attack by Timber Pests, and the carrying out of Tests Where Appropriate, If you require an Invasive Inspection, you must advise us at the time of booking. And supply written permission of the vendor giving there permission for this type of work to be carried out UNLESS OTHERWISE SPECIFIED THIS VISUAL ASSESSMENT OF EVIDENCE INDICATING ACTIVITY, DAMAGE AND/OR WORKINGS OF THE FOLLOWING TIMBER DESTROYING ORGANISMS: Subterranean Termites: That group of wood destroying insects of the Order Isoptera, which are commonly, described a Subterranean, Refer to the accompanying Technical Information Sheet. Dampwood Termites: That group of wood destroying insects of the Order Isoptera, which are commonly described as Dampwood, Refer to the accompanying Technical Information Sheet. Wood Decay Fungi: Fungal organisms that commonly cause the deterioration or decay of timber in service. Refer to the accompanying Technical Information Sheet. Beetles that attack timber in service (Borers): That group of wood destroying insects of the Order Colioptra that are known to cause timber damage, Refer to the accompanying Technical Information Sheet. Chemical Delignification: Organisms that cause the breakdown and or separation of timber cell walls in both softwood and hardwood timbers Refer to the accompanying Technical Information Sheet. IMPORTANT NOTE: The Inspection does not report on the presence of DRYWOOD TERMITES although visible evidence will be, reported if found. IMPORTANT INFORMATION Any person who relies upon the contents of this Report does so acknowledging that the above clauses define the Scope and Limitations of the inspection and form an integral part of the report. The report is made solely for the use and benefit of the Client named on the front of this Report and no liability or responsibility whatsoever, in contract or in tort, is accepted to any third party who may rely on this Report wholly or in part. Any third parties acting or relying on this report do so at their own risk. THIS REPORT IS NOT A GUARANTEE- PLEASE READ TERMS AND CONDITIONS OF INSPECTION CAREFULLY V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 1

INSPECTION REPORT SUMMARY Active Termites found: NONE FOUND (To accessible areas of the property) Termite Damage found: NONE FOUND (To accessible areas of the property) Borer Damage found beetles that attack timber in service: NONE FOUND (To accessible areas of the property) Wood decay / wet rot damage found: YES (see section 4 wood decay fungi (timber wet rot) Chemical Delignification found: NONE FOUND (To accessible areas of the property) Environmental & conducive conditions to timber pest attack found: YES (see section 7 environmental conditions) Any areas(s) to which access should be gained: YES (see section 1 property access restrictions) Invasive investigation of inaccessible areas required: YES (see section 10 future inspections recommendations) Pest treatment evidence found: NO EVIDENCE FOUND (see section 8 evidence of previous termite treatment) Weather conditions at time of inspection : Fine & Clear Date of inspection: Wednesday, 5 July 2006 Time of inspection: 12-00 pm Orientation the building faces: NORTH (For the purpose of this report, the façade of the building contains the main entrance door) THIS SUMMARY SECTION IS NOT THE COMPLETE REPORT IMPORTANT NOTE This Brief Summary is supplied to allow a quick and superficial overview of the inspection results. This summary is NOT the Report and cannot be relied upon on its own. It is important that you understand that in the event of an apparent discrepancy the Report overrides the Summary information. The Timber Pest Inspection Report also includes important information contained in the attached Terms and conditions and Information sheet. BRIEF DESCRIPTION OF BUILDINGS INSPECTED THE RESIDENCE IS A SEMI HOUSE. THE OUTER WALLS ARE CONSTRUCTED FROM MOSTLY FULL BRICK WITH A FIBRO WALL SECTION TO REAR LEFT WALL BATHROOM EXTERIOR OVER TIMBER FRAMES WITH BRICK FOOTINGS. THE EXTERIOR ROOF IS OF TILE OVER TIMBER FRAME TO THE FAÇADE WITH METAL SECTIONS OVER REAR AND REAR EXTENSIONS. THE INTERIOR FLOORING IS OF SUSPENDED TIMBER CONSTRUCTION WITH CONCRETE SLAB SECTIONS TO FRONT ENTRY PATIO, KITCHEN BATHROOM AND EXTERIOR ATTACHED LAUNDRY. THERE IS AN ATTACHED LAUNDRY TO REAR OF RESIDENCE WITH A METAL ROOF BRICK CLAD WALLS CONSTRUCTED ON A CONCRETE SLAB FLOOR. THE BOUNDARY FENCING IS OF TIMBER PAILING CONSTRUCTION TO RIGHT BOUNDARY WITH A CORRUGATED METAL SHEET FENCE WITH TIMBER FRAME TO LEFT PERIMETER AND A BRICK WALL TO REAR PERIMETER. THE RESIDENCE WAS FURNISHED AND OCCUPIED AT TIME OF INSPECTION. FOR COMPLETE AND ACCURATE INFORMATION, PLEASE REFER TO THE FOLLOWING REPORT Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 2 16/07/2006

INSPECTION REPORT REPORT STANDARD DEFINITIONS No visible evidence: There was no visible indication of the presence or activity of timber pests at the time of the inspection. Visible evidence: Timber, Pest damage or signs of their activity was detected at time of inspection. Visible active evidence: Active timber pests were identified at the time of inspection. Moderate Risk: Local environmental, building structure or site conditions indicate an increased possibility of infestation or damage Moderate High Risk: In any area where timber pest activity has been detected there is an ongoing risk of damage unless a pest management program has been implemented. High Risk: Local environmental, building structure or site conditions indicate that there is a very high probability of infestation or destructive timber pest activity. High to Extreme Risk: Conditions provide an ideal environment for heavy infestation and serious structural damage as a result of timber pest activity. Some damage present: Moderate physical damage due to the action of timber pests was identified at the time of inspection. Serious damage present: It appears that serious structural damage may be present requiring repair or replacement as a matter of urgency. AREAS OF PROPERTY INSPECTED Detail: INTERIOR, RESIDENCE EXTERIOR, ROOF VOID, FENCING AND EXTERIOR TIMBERS WITHIN THE PROPERTY BOUNDARIES 1 PROPERTY ACCESS RESTRICTIONS LOCATION SUBFLOOR ROOF VOID EXTERIOR NATURE OF RESTRICTION NO PHYSICAL ACCESS WAS POSSIBLE TO AREAS OF UNDER THE RESIDENCE FOR INSPECTION; AN ENTRY TRAP DOOR WAS LOCATED. TO THE LIVING ROOM AREA HOWEVER DUE TO THE PROXIMITY TO THE GROUND OF THE FLOORING TIMBERS NO ACCESS COULD BE MADE IT IS STRONGLY ADVISED THAT SHOULD YOU PURCHASE THIS PROPERTY THAT YOU ARRANGE FOR ACCESS TO BE MADE AND HAVE A REINSPECTION CARRIED OUT AS TIMBER PEST DAMAGE MAY BE PRESENT IN THIS HIGH RISK AREA. THE SECTION OF THE ROOF OVER REAR KITCHEN BATHROOM AND LAUNDRY IS OF SKILLION STYLE CONSTRUCTION AND IN THIS SECTION; THERE IS NO ACCESSIBLE CAVITY PRESENT FOR INSPECTION. INSUFFICIENT SLAB EDGE EXPOSURE WAS NOTED WAS NOTED TO THE CONCRETE PATH OF REAR FIBRO WALL OF THE BATHROOM AND BUILT UP EARTH IS AT A SIMILAR LEVEL TO THE INTERIOR FLOORING TO EXTERNAL AREAS TO LEFT SIDE OF THE RESIDENCE REAR OF BEDROOM TWO AND LIVING AREA, THUS CONCEALING POSSIBLE TERMITE ENTRY IMPORTANT NOTE No liability shall be accepted on account of failure of the within Report to notify of any Timber Pest activity and/or damage present at or prior to the date of the within Report in any area(s) or section(s) of the subject property physically inaccessible for inspection or to which access for inspection is denied by or to the Inspector (including but not limited to) any area(s) or section(s) so specified by the within Report WHERE COMPLETE INSPECTION OF SPECIFIED AREAS IN NOT POSSIBLE, TIMBER PEST ACTIVITY AND/OR DAMAGE MAY EXIST, AND INVASIVE INSPECTION MAY BE REQUIRED. 2 ACTIVE TERMITES Visible evidence found: NO VISIBLE EVIDENCE OF ACTIVE TERMITES WAS FOUND IN AREAS ABLE TO BE INSPECTED OF THE PROPERTY AT THE TIME AND DATE OF THE INSPECTION IT IS STRONGLY ADVISED THAT SHOULD YOU PURCHASE THIS PROPERTY THAT YOU ARRANGE FOR ACCESS TO BE MADE TO THE INACCESSIBLE SUBFLOOR AREAS AND HAVE A REINSPECTION CARRIED OUT AS TIMBER PEST DAMAGE MAY BE PRESENT IN THIS HIGH RISK AREA VERY IMPORTANT NOTE The prospective purchaser should be warned If live termites or any evidence of termite workings or damage is reported within the building(s) or in the ground and fences then it must be assumed that there may be concealed termite activity and/or timber damage. This concealed activity or damage may only be found when alterations are carried out such as when wall linings, cladding or insulation is removed to the inaccessible areas of the wall and roof void areas of the residence this type of damage would not be visible to the inspector due to the visual only nature of the inspection you should arrange for an invasive inspection. We claim no expertise in structural engineering. We take no responsible for the repair of any damage whether disclosed by this report or not. (See Terms & Conditions). We strongly recommend that you have a qualified person such as an, Engineer, master builder or Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 3 16/07/2006

other qualified expert in the building trade determine the full extent of the damage, if any. This may require a more thorough INVASIVE INSPECTION and this is available and strongly recommended. Where any current visible evidence of Timber Pest activity is found. The exterior of Trees within the property boundary up to a height of 2m have been visually inspected, where possible and practicable, for evidence of termite activity. However, it is very difficult, and generally impossible to locate termite nests since they are underground and evidence in trees is usually well concealed. We therefore strongly recommend that you arrange to have any trees on site test drilled for evidence of termite nests. WHERE EVIDENCE OF ACTIVE TERMITES IS FOUND IT IS STRONGLY RECOMMENDED THAT YOU HAVE A TERMITE TREATMENT IN ACCORDANCE WITH "AUSTRALIAN STANDARD 3660" CARRIED OUT 3 TERMITE DAMAGE Visible evidence found: NO VISIBLE EVIDENCE OF INACTIVE TERMITE WORKINGS AND OR DAMAGE WAS FOUND IN AREAS ABLE TO BE INSPECTED OF THE PROPERTY AT THE TIME AND DATE OF THE INSPECTION, IT IS STRONGLY ADVISED THAT SHOULD YOU PURCHASE THIS PROPERTY THAT YOU ARRANGE FOR ACCESS TO BE MADE TO THE INACCESSIBLE SUBFLOOR AREAS AND HAVE A REINSPECTION CARRIED OUT AS TIMBER PEST DAMAGE MAY BE PRESENT IN THIS HIGH RISK AREA IMPORTANT NOTE The prospective purchaser should be warned Where visual evidence of termite workings and/or damage from subterranean termites is reported above, but no live termites were present at the time of inspection, you must realise that it is possible that termites are still active in the immediate vicinity and the termites may cause further future damage. Subterranean termite attack can occur within 24 hours of an inspection. It is not possible, without benefit of further investigation and a number of inspections over a period of time, to ascertain whether any infestation is active or inactive. Active termites may simply have not been present at the time of inspection due to a prior disturbance, climatic conditions, or they may have been utilising an alternative feeding source without regular inspections significant further damage may occur, and is impossible to predict. A timber pest management program, including regular inspections, is strongly recommended. WHERE ANY DAMAGE IS PRESENT, IT IS STRONGLY RECOMMENDED THAT YOU HAVE IT FULLY ASSESSED BY A QUALIFIED BUILDER OR STRUCTURAL ENGINEER. For more detailed information on termites refer to the attached Information Sheet that forms an integral part of this Report 4 WOOD DECAY FUNGI (Timber Wet Rot) Visible evidence found: EXTERIOR ROOF PERIMETER FACIA BOARD TIMBERS THE TIMBERS HAVE BEEN RECENTLY PAINTED MODERATE WET ROT DECAY DAMAGE WAS FOUND TO THESE TIMBERS AND TO FRAMING TIMBERS OF LEFT REAR BOUNDARY FENCING DUE TO AGE AND WEATHERING DAMAGE AND MINOR TO MODERATE WET ROT DECAY DAMAGE WAS FOUND TO THESE TIMBERS. IMPORTANT NOTE: Where visible damage from Wood Decay Fungi is detected, a brief description of observable damage has been provided. It should be noted that an amount of damage may be present but cannot be seen without intrusive inspection techniques. This is not a structural report. WHERE ANY DAMAGE IS PRESENT, IT IS STRONGLY RECOMMENDED THAT YOU HAVE IT FULLY ASSESSED BY A QUALIFIED BUILDER OR STRUCTURAL ENGINEER. For more detailed information on Wood Decay Fungi refer to the Information Sheet that forms an integral part of this Report 5 BORERS (of timber in service) Visible evidence found: NO VISIBLE EVIDENCE OF BORER DAMAGE WAS FOUND IN AREAS ABLE TO BE INSPECTED OF THE PROPERTY AT THE TIME AND DATE OF THE INSPECTION IT IS STRONGLY ADVISED THAT SHOULD YOU PURCHASE THIS PROPERTY THAT YOU ARRANGE FOR ACCESS TO BE MADE TO THE INACCESSIBLE SUBFLOOR AREAS AND HAVE A REINSPECTION CARRIED OUT AS TIMBER PEST DAMAGE MAY BE PRESENT IN THIS HIGH RISK AREA IMPORTANT NOTE: Due to the biology and habits of the known species of borers there may be a delay between infestation and any visible evidence of borer activity or evidence of damage. WHERE ANY DAMAGE IS PRESENT, IT IS STRONGLY RECOMMENDED THAT YOU HAVE IT FULLY ASSESSED BY A QUALIFIED BUILDER OR STRUCTURAL ENGINEER. For more detailed information on borers refer to the attached Information Sheet that forms an integral part of this Report Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 4 16/07/2006

6 CHEMICAL DELIGNIFICATION Visible evidence found: NO VISIBLE EVIDENCE OF DELIGNIFICATION OF TIMBERS WAS FOUND IN AREAS ABLE TO BE INSPECTED OF THE PROPERTY AT THE TIME AND DATE OF THE INSPECTION NOTE: Chemical Delignification is the breakdown of cellular walls and is uncommon in both hardwood and softwood timber in service. In timber of large dimensions is will usually take a considerable period before structural integrity is compromised, although smaller sections such as battens may collapse sooner. WHERE ANY DAMAGE IS PRESENT, IT IS STRONGLY RECOMMENDED THAT YOU HAVE IT FULLY ASSESSED BY A QUALIFIED BUILDER OR STRUCTURAL ENGINEER. For more detailed information on Chemical Delignification refer to the attached Information Sheet that forms an integral part of this Report 7 ENVIRONMENTAL CONDITIONS CONDUCIVE TO TIMBER PEST ATTACK Location REAR WALL AND LEFT SIDE OF THE RESIDENCE Nature of condition: INSUFFICIENT SLAB EDGE EXPOSURE WAS NOTED WAS NOTED TO THE CONCRETE PATH OF REAR EXTERIOR WALL OF BATHROOM INSUFFICIENT SLAB EDGE EXPOSURE BUILT UP EARTH TO EXTERNAL AREAS TO LEFT SIDE OF THE RESIDENCE SOIL LEVEL IS AT A SIMILAR LEVEL TO INTERIOR FLOORING, BUILT UP EARTH TO EXTERNAL AREAS THUS CONCEALING POSSIBLE TERMITE ENTRY WHILST WE ARE NOT BUILDERS, THE SUB FLOOR VENTILATION WAS CONSIDERED INADEQUATE. POOR VENTILATION, ESPECIALLY IN THE SUB FLOOR, INCREASES THE LIKELIHOOD OF TIMBER PEST ATTACK. A BUILDER OR OTHER BUILDING EXPERT SHOULD BE CONSULTED Notes: THESE SITUATIONS REQUIRE THIS ADVISE OF A BUILDER, WHILST WE ARE NOT BUILDERS WE SUGGEST LOWERING OF THE GROUND LEVELS TO REVEAL AT LEAST 75 MM OF THE CONCRETE SLAB EDGE AND LOWERING OF THE GROUND LEVELS TO BELOW THE INTERIOR FLOORING LEVEL, WE ALSO SUGGEST THAT A VENTILATION EXPERT BE CONSULTED TO REMEDY THE DAMP CONDITIONS WITH IN THE SUBFLOOR AREAS WHERE VENTILATION OR SUBFLOOR DRAINAGE IS CONSIDERED INADEQUATE IT IS STRONGLY RECOMMENDED THAT YOU HAVE IT FULLY ASSESSED BY A QUALIFIED BUILDER Please refer to the section Information for detailed information on how to reduce favourable environmental conditions for timber pest activity. Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 5 16/07/2006

8 EVIDENCE OF PREVIOUS TERMITE TREATMENT OR TERMITE BARRIER SYSTEM INSTALLATION Visible evidence: NO VISIBLE EVIDENCE FOUND AND NO NOTICES WERE FOUND IN A PROMINENT PLACE ON THE PROPERTY INDICATING A PREVENTATIVE TREATMENT HAS BEEN CARRIED OUT Notes: IT HAS ONLY BEEN COMPULSORY FOR MOST BUILDINGS CONSTRUCTED OR UNDERGOING MAJOR RENOVATION SINCE JUNE 1995 TO HAVE A NOTICE AFFIXED IN A PROMINENT PLACE USUALLY THE METER BOX OUTLINING THE TYPE OF TERMITE PROTECTION SYSTEM PUT IN PLACE AND THE DATES OF INSULATION OF THE TERMITE PROTECTION SYSTEM YOUR LEGAL REPRESENTEE SHOULD ENDEAVOUR TO OBTAIN COPIES OF ANY DOCUMENTATION. Include the location of any Termite Treatment Notice affixed at the entrance to a crawl space or some other place where it was protected from damage, e.g. in the case of a slab-on-ground construction, in an external electrical meter box WARNING: If evidence of drill holes in concrete paths or paving or evidence of trenching / scarifying of the soil to the subfloor interior perimeter foundations WAS found or any other signs of a possible previous treatment are reported then this was possibly due to an earlier termite attack. Extensive structural damage may exist in concealed areas. You should have an invasive inspection carried out and have a builder or structural engineer determine the full extent of any timber damage /if any and the estimated cost of repairs as the possible timber damage may only be found when wall linings etc are removed. Previous termite treatments SINCE JULY 1995 should include a durable notice; this will usually be located in the meter box or other prominent place on the residence, indicating the type of termite treatment system, the treated zone and the dates that the system was installed. This firm can give no assurances with regard to work that may have been previously performed by others. You or your legal representee should endeavour to obtain copies of all paperwork and you should make your own inquiries as to the quality of the treatment, and when it was carried out, and any warranty information. In most cases, it is recommend you arrange for a re treatment in accord with "Australian Standard 3660" be carried out to reduce the risk of further attack. IF NO WRITTEN EVIDENCE OF A TERMITE PROTECTION PROGRAM TO AS 3660- IS PROVIDED A PREVENTATIVE TERMITE TREATMENT TO AS 3660 SHOULD ALWAYS BE CONSIDERED, TO PREVENT ATTACK. 9 TIMBER PEST TREATMENT RECOMMENDATIONS Based on the evidence of this inspection the overall risk of infestation by timber pests is: HIGH DUE TO THE INACCESSIBLE HIGH RISK AREAS AND THE NUMBER OF CONDUCIVE CONDITIONS FOUND THE PROSPECTIVE PURCHASER SHOULD BE WARNED TO EXPECT THAT TIMBER DAMAGE MAY BE FOUND WHEN ACCESS IS CREATED TO THE INACCESSIBLE AREAS OF THE PROPERTY, YOU SHOULD ARRANGE WITH THE VENDOR OF THE PROPERTY FOR ACCESS TO BE MADE AND HAVE A REINSPECTION CARRIED OUT BEFORE PROCEEDING WITH THIS PURCHASE. 10 FUTURE INSPECTIONS RECOMMENDATIONS It is strongly recommended that a further timber pest inspection be conducted at: WHEN ACCESS IS MADE OR WITH IN THREE MONTHS OF PURCHASE NOTE: Regular inspections will not prevent future attack by subterranean termites or other timber pests but it will assist in the early identification of activity. Detection at the earliest opportunity will allow treatment to commence and damage minimised. 11 FUTURE TIMBER PEST MANAGEMENT Based on the evidence of this inspection timber pest treatment is: NOT REQUIRED AT THIS TIME Notes: YOUR LEGAL REPRESENTEE SHOULD ENDEAVOUR TO OBTAIN COPIES OF ANY DOCUMENTATION OUTLINING THE TYPE OF TERMITE PROTECTION SYSTEM PUT IN PLACE AND THE DATES OF INSULATION OF THE TERMITE PROTECTION SYSTEM DURING THE CONSTRUCTION OF THE RESIDENCE. Inspection carried out by: Gordon Shields NSW Licence No: 657 Signed for and on behalf of: PesttDecttiive PEST CONTROL & INSPECTION SERVICES www.pestdective.net Inspector s signature: GordonShields Dated this Wednesday, 5 July 2006 Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 6 16/07/2006

PRE-PURCHASE TIMBER PEST INSPECTION REPORT TERMS AND CONDITIONS Important note: having provided to you an opportunity to read or hear the Terms and Conditions following upon you making a booking for the Timber Pest Inspection, the inspector has proceeded to conduct the inspection of the property and to supply this Report on the basis that you have accepted these Terms and Conditions below and/or are deemed to have done so upon the inspector arriving at the property and commencing the inspection. Disclaimer of liability to third parties: This Report is made solely for the use and benefit of the Client named on the front of this report. No liability or responsibility whatsoever, in contract or tort, is accepted to any third party who may rely on the Report wholly or in part. Any third party acting or relying on this Report, in whole or in part does so at his or her own risk. THIS IS A VISUAL INSPECTION ONLY This visual inspection is limited to those areas and sections of the property fully accessible and visible to the Inspector at the time and on the date of Inspection. Inspection has been made in the areas where infestation is most likely to occur. The inspection DID NOT include breaking apart, dismantling, removing or moving objects including, but not limited to, foliage, mouldings, roof insulation/sisalation, floor or wall covings, sidings, ceilings, floors, furnishings, appliances or personal possessions. The Inspector CANNOT see inside walls, between floors, inside skillion roofing, inside the eaves, behind stored goods in cupboards, or other areas that are concealed or obstructed. The inspector DID NOT dig, gouge, force or perform any other invasive procedures. An invasive inspection will not be performed unless a separate contract is entered into. In an occupied property, it must be understood that furnishings or household items may be concealing evidence of Timber Pests or damage, which may only be revealed when the items are moved or removed. In the case of Strata, type properties, only the interior of the unit is inspected. Inspection of fence lines and posts is restricted to those timbers above ground level and facing the property inspected. The inspection DOES NOT extend nor should comments be inferred in respect to timbers, palings, fence posts below ground level, or where timbers are obstructed by plant life or overgrowth or other materials, which restrict or prevent physical bodily access. NO INSPECTION is inferred to areas of trees or external areas of trees or external areas over 3.6 metres above the natural ground level. Only areas to which reasonable access is available were inspected. The Australian Standard 4349.3 defines reasonable access as areas where safe, unobstructed access is provided and the minimum clearances specified below are available, or where these clearances are not available, areas within the inspector s unobstructed line of sight and within arm s length. Reasonable access does not include removing screws and bolts to access covers. Reasonable access DOES NOT include the use of destructive or invasive inspection methods NOR DOES it include cutting or making access traps or moving heavy furniture, floor coverings or stored goods. Roof interior 450x 400mm 600 x 600mm Accessible from 2.1m stepladder or 3.6m ladders placed against a wall. Sub floor 500x 400mm Vertical clearance Timber floor: 400mm to bearer, joist or other obstruction. Concrete floor: 500mm Roof Exterior Accessible from a 3.6m ladder. LIMITATIONS Nothing contained in the Report implies that any inaccessible or partly inaccessible area(s) or section(s) of the property being inspected by the Inspector on the date of the inspection were not, or have not been, infested by Timber Pests. Accordingly, this Report is NOT A GUARANTEE that an infestation and/or damage does not exist in any inaccessible or partly inaccessible area(s) or section(s) of the property, nor is it a guarantee that a future infestation of Timber Pest will not occur or be found and does not protect the building from future attack by timber destroying agents. The status and condition of a building may change at any time due to environmental, cultural and the habits of termites and other timber pests. SCOPE OF REPORT This report is confined to the reporting on the discovery, or non discovery, as the case may be, of infestation and/or damage caused by subterranean termites (white ants), borers of dry seasoned timber and wood decay fungi (hereinafter referred to as Timber Pests ), by visual inspection of those areas and sections of the property accessible to the Inspector at the time and on the date of inspection. The inspection DID NOT cover any other pests and this Report DOES NOT comment on them. The Inspection did not cover any other pests and this Report does not comment on them. Dry wood termites (Family: KALOTERMITIDAE) and European House Borer (Hylotrupes bujulus Linnaeus) were excluded from the Inspection, but have been reported on if, in the course of the Inspection, any visual evidence of infestation happened to be found. If Cryptotermes brevis (West Indian Dry Wood Termite) or Hylotrupes bujulus Linnaeus are discovered, we are required by law to notify Government Authorities. If reported a special purpose report may be necessary. No liability shall be accepted on account of failure of the within Report to notify of any Timber Pest activity and/or damage present at or prior to the date of the within Report in any area(s) or section(s) of the subject property physically inaccessible for inspection or to which access for inspection is denied by or to the Inspector (including but not limited to) any area(s) or section(s) so specified by the within Report. This report does not and cannot state the extent of damage. Any mention within this report relating to extent of any damage has been done with the sole intent of assisting with treatment specifications and must not be used by any party as a guide to the extent of damage for the purpose of estimating repairs or replacement costs. If any past or present infestation or damage is noted in this Report, whether this damage is to the structure or the surrounding grounds, it is strongly recommended that a qualified person such as a Builder, Engineer, Architect or other qualified expert in the Building Trade be asked to determine the extent of the damage to the property and if required an invasive inspection must be carried out to determine any concealed timber pest damage or activity. Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 7 16/07/2006

PestDective Timber Pest Inspection Information Sheet The information contained in this Information Sheet forms an integral part of the Report. Conclusions and findings of the Report MUST also be read in conjunction with the information contained herein. Termites are everywhere! SUBTERRANEAN TERMITES Warning: N.S.W. has its share of destructive termites, however they are nothing compared with their cousins. In northern Australia, they can grow up to 15mm long (Mastotermes darwiniensis) and will devour wood, cow dung, paper and crops for their cellulose content. They are even known to attack, make holes in plastic water pipes and even attack copper water pipes. There are over 300 species of termite in Australia, but only about 30-cause damage of any economic significance. Only Tasmania is free of economically significant termite attack to buildings. IMPORTANT NOTE There is no household insurance that covers your property for termite damage Termites in other states may be smaller than the species in the north of Australia but can be more numerous and just as voracious. Termites tend to be prevalent in moist sandy soils, like coastal suburbs especially where high subfloor moisture is present (one in three houses or more is likely to have had termite trouble) but clay and other soils are also quite susceptible. However, they can attack anywhere and no area in Australia is immune except Tasmania. The difficulty is that they are extremely difficult to detect. For this reason a visual inspection that fails to find termite activity does not necessarily mean that they are not DIFFICULTIES FACED BY A TIMBER PEST INSPECTOR (it is not possible to guarantee that a property is free of timber pests). A clear view of subfloor walls and piers and easy access to the sub-floor means that detection should be fairly easy. However many styles of construction do not lend themselves to ready detection of termites. The design of some properties is such that they make the detection by a pest inspector difficult, if not impossible. (See section concrete slab homes) The tapping and probing of walls and internal timbers is an adjunct or additional means of detection of termites but is not as reliable as locating termite workings. The use of a moisture meter is a useful aid for determining the presence of termites concealed behind thin wall panels, but it only detects high levels of active termites. Older damage that has dried out will not be detected. Due to the possibility of a leaking pipe, rising damp or other unseen moisture source, it may also provide false readings. Termite workings may be present in the ceiling space however; some roofs of a low pitch construction and or roofs with the presence of sisalation, insulation, and air conditioning ductwork and hot water service tanks may prevent a full inspection of the timbers in these areas. Therefore, since foolproof and absolute certain detection is not possible the use of protective barriers and regular inspections is a necessary step in protecting timbers from termite attack. SUBTERRANEAN TERMITE BEHAVIOUR Termites dislike light, preferring dark moist environments because their bodies are very prone to desiccation (drying out). They will never be found in the open and their activity is always inside shelter tubes or with the or the timber, they are attacking. In very bad infestations, they may eat almost all of the available timber, leaving only a very thin veneer on the surface. Commonly they will completely gut a piece of wood leaving nearly no visible evidence on the outside of the timber. Main and often subsidiary nests are excavated underground or in rotted tree stumps and woodpiles, wherever humidity is high. Underground galleries are made by termites to search for food sources (wood). The galleries preserve the moist atmosphere of the nest, shield the termites from light and protect them from predators (largely ants). Their network of galleries can stretch up to a hundred & fifty metres from the nest in search of food. (Wood) Where their galleries leave the ground (for example to feed on a house s floor framing), the termites construct shelter tubes with the same properties as galleries. They are usually about 20mm wide and look like piled-up mud trails, being constructed of soil and faecal material, bound together with termite saliva. These mud shelter tubes are the best way of identifying termite activity. The tubes may be seen climbing up the walls between the ground and floorboards, or if your house has stumps, snaking over ant caps between the engaged pier and bearer timber. Once new food is found, the colony can virtually excavate the whole of the inside of the timber, leaving only a honeycomb of tunnel walls and a thin outer layer, which preserves the controlled atmosphere. The destruction can be devastating as much a $100,000 dollars in six months. Termites are good at predicting weather changes. Even before a heavy warm season downpour begins, swarms of the reproductive caste termites (alates) are released from the nest and fly away to form new colonies. Fortunately, of the millions, which set out, only an occasional pair succeeds in finding a suitable site, and many of these are taken by predators or die by desiccation. Warm humid weather conditions are favoured for the short flights, which usually occur during the warmer months. Once established and mature, the Queen termite can produce up to 2000 eggs a day! This represents a huge potential for ever-increasing timber destruction, if conditions are right. Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 8 16/07/2006

PRECAUTIONS THAT SHOULD BE TAKEN TO GUARD AGAINST SUBTERRANEAN TERMITE ATTACK Remove all timber debris from under the house, since the presence of timber on with ground contact encourages foraging termites. Move piles of timber or firewood (potential food source for a new colony) away from the house, and store the timber off the ground in a dry, well-ventilated location. Old decayed tree stumps should be removed to below ground level. If you notice, what you think is termite activity, take some live specimens and have them identified immediately. Ensure adequate subfloor ventilation under all suspended floors. Doing this will reduced humidity and moisture, which makes the subfloor area vastly less attractive to termite activity. Leaking water pipes or poor subfloor drainage encourages termite presence so these faults should be remedied. Never disturb what you think may be termite activity. Immediately call an expert Termites are shy creatures disturbing them prompts the termites to evacuate there workings, which makes detection and eradication more difficult. It may also result in further damage elsewhere. Examine new constructions: for example, verandas and timber decking, if built on stumps, they may not have ant capping. These constructions, and concrete additions to the house, may also provide a bridge allowing termites to bypass previously laid chemical or physical barriers, permitting concealed termite entry to the timbers of the property. The underside of an infill or concrete slab on ground is a common place for termite nests. If concrete is laid adjacent to the timber frame of a house with out a protective barrier damp conditions may be promoted and may attract concealed termite entry, which is extremely difficult to detect. You should consider this when renovating: If concrete-next-to-timber is part of the design, have an expert lay a chemical barrier down first. Footnote (QLD only) West Indian Drywood Termites These highly destructive termites were first recorded in Maryborough in 1964. They do not need access to water or earth, so do not leave the normal termite mud workings, thus are harder to detect. Colonies have since been found in Maryborough, Bundaberg, Childers and Brisbane. They have been declared a notifiable pest and eradication treatment is performed without cost to the householder. You can minimise the chance of infestation by thoroughly examining second-hand timber and furniture before introducing it to your house. West Indian termites leave very small oval shaped pellets, brown, black or reddish in colour, near the site of attack. If you suspect you have them, send samples of the pellets (or frass ) to the Queensland Department of Forestry. The Queensland Department of Forestry urges the public to be vigilant and hopes to eradicate this pest completely. GETTING RID OF SUBTERRANEAN TERMITES WARNING: If evidence of drill holes in concrete paths or paving or evidence of trenching / scarifying of the soil to the subfloor interior perimeter foundations is found or other signs of a possible previous treatment are reported then this was possibly due to an earlier termite attack. Extensive structural damage may exist in concealed areas. You should have an invasive inspection carried out and have a builder or structural engineer determine the full extent of any timber damage /if any and the estimated cost of repairs as the possible timber damage may only be found when wall linings etc are removed. Previous termite treatments carried out only since June 1995 should include a durable notice, usually located in the electrical meter box or other prominent place on the residence, indicating the type of termite treatment system, the treated zone and the dates that the system was installed. A pest control firm can give no assurances with regard to work that may have been previously performed by others. You or your legal representee should endeavour to obtain copies of all paperwork and make your own inquiries as to the quality of the treatment, and when it was carried out, and any warranty information. In most cases, it is recommend you arrange for a re treatment in accord with "Australian Standard 3660" be carried out to reduce the risk of further attack. The annoying part is that termites are hard to find even for experts and it is usually only after a chair leg goes through a weakened floor, or the vacuum cleaner head crushes a hollowed-out skirting board, that people notice their unwelcome visitors for the first time. Termites typically leave the thinnest of barriers between themselves and the atmosphere: sometimes the mere thickness of a coat of paint, which can be a way of identifying their presence. They are normally first noticed in low density woods like skirtings, architraves, floorboards and pine house framing timbers, but can extend into denser hardwood timbers if not eradicated. Termites can be eradicated. This usually involves puffing a toxic dust (arsenic or triflumuron) into their galleries and covering over the entry point after treatment. Termites clean or groom each other and so pass on the toxic dust, which has adhered to their soft moist bodies. They also cannibalise dead members of the colony and eventually the toxin is passed through the entire colony. This usually the first part in a two part treatment when the dusting treatment is completed a chemical barrier should be laid down to prevent further future termite attack. The eradication treatment should be performed by an expert, so make sure you contact only currently licensed insured members of your State s pest control association. Termites are the cause of the greatest economic losses of timber in service in Australia. Independent data compiled by State Forestry shows 1 in every 5 homes is attacked by termites at some stage in its life. More recent data would indicate that this is now as high as 1 in every 3. Australia s subterranean termite species (white ants) are the most destructive timber pests in the world. In fact, it can take as little as 3 months for a termite colony to severely damage a home. A single treatment might possibly have eradicated a previous infestation of termites but it is no guarantee that they will not return and attack a house again. All treatment and barrier systems have limitations. Physical barriers can be bridged or broken, chemical barriers and baits can deteriorate over time. Many product guarantees have conditional cover that depends on the quality of the installation. Many claims are made, but there is ultimately no guarantee that any system will provide complete protection. Consequently, we always strongly recommend an integrated Pest Management Plan that includes regular inspections. Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 9 16/07/2006

SUBTERRANEAN TERMITE ECOLOGY COPTOTERMES SPECIES these termites have the potential to cause large amounts of damage to timber including structural damage the coptotermes acinaciformis is the most often encountered pest termite throughout Australia and one of the most destructive causing the most economic damage. It makes its colonies in trees tree stumps and wood in the ground and a mature colony of these termites can contain over one million individuals. SCHEDORHINOTERMES SPECIES these termites have the potential to cause moderate to large amounts of damage to timber including structural damage commonly found in eastern nsw - particularly along the entire coastline, the great dividing range and western slopes. nest location - schedorhinotermes intermedius commonly build their nest in tree stumps, in the root crown of the living, dead and debilitated trees, under houses or within enclosed patios or other areas where timber has been buried or stored in contact with the soil. Identification - this species tends to "gouge" the affected timber and has a fetish around nails used in construction. When you first find them, you will often see a major soldier (6mm in body length) and a minor soldier (4mm in body length). Destructive nature - schedorhinotermes intermedius are highly destructive to buildings and other timber structures. If mostly major (larger) soldiers are sighted, then they will most likely be a large colony with the potential to cause severe and rapid damage to structural timbers of a building or other timber structures. NASUTITERMES SPECIES these termites have the potential to cause moderate amounts of damage to timber including structural damage HETEROTERMES SPECIES these termites have the potential to cause moderate to large amounts of damage to timber including structural damage. MASTOTERMES DARWINIENSIS these termites have the potential to cause large amounts of damage to timber including structural damage commonly found in tropical Queensland generally north of the tropic of Capricorn. Nest location mastotermes darwiniensis build their nest (secretively) totally below the soil surface; or in the trunks and root crowns of trees and stumps. Once a nest is mature (over 100,000 or much higher), they can split off to form there nests over a wide-ranging area. These sub nests are formed constantly and can sustain life for along period of time without contact to the original nest. highly destructive nature mastotermes darwiniensis is one of the worlds most destructive termite species, often causing severe damage to houses, buildings, bridges, posts, poles, and many other plant and animal products. It is also an agricultural pest, responsible for ring-barking and killing living trees, shrubs, fruit, vegetable crops, sugarcane and rubber trees. It is reported to attack rubber tyres on tractors and cause damage to leather, hide, plastic or lead-sheathed cables, bitumen, bagged salt, flour, glass and various metals. mastotermes darwiniensis is the most ancient of all the termites in the world THEY OCCUR ONLY IN QUEENSLAND A TERMITE TO BE FEARED Termites are social insects living in underground nests. They tunnel underground to enter the building and then remain hidden within the timber making it very difficult to locate them. Where timbers are concealed, as in most modern homes, it makes it even more difficult to locate their presence. Especially if gardens have been built up around, the home and termite barriers are either not in place or poorly maintained. Termites form nests in all sorts of locations and they are usually not visible. There may be more than one nest on a property. The diet of termites in the natural environment is the various hardwood and softwood species growing throughout Australia. These same timbers are used in buildings. Worker termites move out from their underground nest into surrounding areas where they obtain food and return to nurture the other casts of termites within the nest. Termites are extremely sensitive to temperature, humidity and light and hence cannot move over ground like most insects. They travel in mud-encrusted tunnels to the source of food. Detection of termites is usually by locating these mud tunnels rising from the ground into the affected structure. This takes an expert eye. TERMITE SHIELDS (Termite barriers (ant capping) protect a building by forcing termites to show themselves). Ant caps should be in good order and condition so termite workings are exposed and visible. This helps stop termites gaining undetected entry. Joins in the shielding should have been soldered during there installation. Whenever it is observed that the joins in the shielding have not been soldered then the shielding will be reported as inadequate. It may be possible for a builder to repair the shielding or a chemical shield may need to be installed to provide a shield to replace the use of the shielding. Missing damaged or poor shields increase the risk of termite infestation Termites can build mud tunnels around termite barriers to reach the timber above however effective ant capping makes termite workings highly visible. Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 10 16/07/2006

HOMES BUILT OR PART BUILT ON A CONCRETE SLAB Homes constructed on concrete slabs pose special problems with respect to termite attack. If the edge of the slab is concealed by concrete paths, patios, pavers, garden beds, lawns, foliage, etc then it is possible for termites to affect concealed entry into the property. They can then cause extensive damage to concealed framing timbers. Even the most experienced inspector may be unable to detect their presence due to concealment by wall linings. Only when the termites attack timbers in the roof void, which may in turn be concealed by insulation, can their presence be detected. Where termite damage is located in the roof it should be expected that concealed framing timbers will be extensively damaged. With a concrete slab home, it is imperative that you expose the edge of the slab and ensure that foliage and garden beds do not cover the slab edge. Weep holes must be kept free of obstructions. It is strongly recommended that you have a termite inspection in accordance with AS 3660.2 carried out every 6 to 12 months. SLAB EDGE EXPOSURE with AS 3660.2. Where external concrete slab edges are not exposed there is a high risk of concealed termite entry. In some building built since July 1995 the edge of the slab forms part of the termite shield system. In these buildings, an inspection zone of at least 75mm should be maintained to permit detection of termite entry. The edge should not be concealed by render tiles cladding flashings adjoining structures paving soil turf or landscaping etc. Where this is the case, you should arrange to have the slab edge exposed for inspection. Concealed termite entry may already be taking place but could not be detected at the time of the inspection. This may have resulted in concealed timber damage. Note: A very high proportion of termite attacks are over the slab edge. Covering the slab edge makes concealed entry easy. This is particularly true of infill type slab construction. Termite activity and or damage may be present in concealed timbers of the building. We strongly recommend frequent regular inspections in accordance WEEP HOLES IN EXTERNAL WALLS It is very important that soil lawn concrete paths or pavers do not cover the weep holes. These may have been covered during the rendering of the brickwork. They should be clean and free flowing. Covering the weep holes in part or in whole may allow undetected termite entry. BORERS OF SEASONED TIMBER There are several types of timber borers in Australia, some serious and some not, so it is important to identify them if you think you have a problem. Borers are actually the larval form of different families of beetles. Some of the relatively harmless ones not needing any special eradicative treatment are pinhole borers, longicorn borers and auger beetles. Pinhole borers cannot survive in timber once it has dried out, so they normally leave before, or soon after, the timber is used for construction. You can identify them by examining their flight holes (the holes made when leaving the timber). These holes will rarely have borer dust (or frass) around them, since in most cases the insect is long gone or dead. They leave relatively few holes unlike the more destructive species below. LONGICORN BORERS Longicorns leave oval-shaped holes 6 10mm in size as they emerge from framing timbers or wall linings. They are not a serious structural problem because, unlike the more destructive species, they cannot breed in the timber and therefore cannot proliferate. The size and shape of their flight holes makes this borer easy to identify. AUGER BEETLES Auger beetles again fairly harmless are harder to distinguish from the more destructive Lyctid borer. One way of telling them apart is that auger beetles leave far fewer flight holes since they cannot proliferate in the timbers so are far fewer in number. However differentiating them from Lyctids is not normally important since if conditions are right for auger beetles they are even better for Lyctid borers so if one species is present you will normally find the other. Adult beetles lay their eggs within the timber. The eggs hatch out into larvae (grubs) which bore through the timber and can cause significant structural damage. The larvae may reside totally concealed within the timber for a period of several years before passing into a dormant pupal stage. Within the pupal case they metamorphose, (change) into the adult beetle, which cuts a hole in the outer surface of the timber to emerge mate and lay further eggs to continue the cycle. It is only through the presence of these emergence holes and the frass formed when the beetles cut the exit holes that their presence can be detected. Where floors are covered by carpets tiling or other floor coverings and where no access to the underfloor area is available, it is not possible to Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 11 16/07/2006

determine whether borers are present or not. This is particularly the case with the upper floors of a dwelling. LYCTUS BORER (powder post beetle) These borers only attack the sapwood of certain susceptible species of hardwood timber. Since it is a requirement that structural timbers contain no more than 25% Lyctus susceptible sapwood these borers are not normally associated with structural damage. Replacement of affected timbers is not recommended and treatment is not approved. Where decorative timbers are affected, the emergence holes may be considered unsightly in which case timber replacement is the only option. Powder post beetles mostly attack during the first 6-to12 months of service life of timber. As only the sapwood is destroyed, larger dimensional timbers (such as rafters, bearers and joists) in a house are seldom weakened significantly to cause collapse. In small dimensional timbers (such as tiling and ceiling battens), the sapwood may be extensive, and its destruction may result in collapse. Replacement of these timbers is the only option available. ANOBIUM BORER (furniture beetle) and QUEENSLAND PINE BORER Anobiid borers are more serious and attack softwoods, especially varieties of pine (although very rarely do they attack the common Pinus radiata). Like Lyctids, Anobiids are widespread throughout Australia. The Anobium punctatum species especially loves Baltic pine, commonly used 40 to 140 years ago but still occasionally used for floorboards and weatherboards. The Queensland pine anobiid Calymmaderus incisus located from northern NSW and farther north has a similar love for Hoop pine. Anobiids tend to channel along the grain of the wood, making the odd 2mm pinhole and leaving large quantities of loose gritty dust with a texture of fine table salt. They are capable of eating for years and will happily chomp away anonymously under the carpet. Be suspicious if your floorboards get spongy, as this is a common area for them to attack. You will probably first notice the floor feeling spongy at one end of a large room (like the living room) because a big floor area will deflect more noticeably. Also be aware that second hand or antique furniture, or old floorboards may contain borers, so examine such articles well before introducing them into the house. Anobiid damage must always be attended to. Homeowners have sometimes stopped infestation by removing all significant borer infested timbers and replacing them with non-susceptible timbers, then monitoring the results. Such treatment is only worthwhile if subfloor humidity is simultaneously reduced, because borers thrive in damp conditions. Humidity can be reduced by removal of debris, increasing subfloor ventilation (cleaning out vents and possibly adding more) and draining damp soil where necessary. In some cases, Anobiid infested timbers need chemical treatment. As with termite eradication, it is recommended that only currently licensed and insured members of your State s pest control association be contracted and that they should provide a written description of proposed treatment as previously outlined. BORER RECOMMENDATIONS: Replacement of all susceptible timbers is always preferred since, in the event of selling the property in the future it is probable that an inspector will report the borers as active (see above). A chemical treatment to control and/or protect against furniture beetle and/or Queensland pine beetle can be considered as a less effective, lower cost option. Before considering this option, you should consult with a builder (See Terms & Conditions) to determine if the timbers are structurally sound. Following the initial treatment, a further inspection is essential in twelve months time to determine if further treatment is needed. Treatments over a number of consecutive years may be required. Borers of green unseasoned timber may also be present. However, these species will naturally die out as the timbers dry out in service. Whilst some emergence holes may occur in a new property it would be unusual for such a borer to cause structural damage, though the exit holes may be unsightly. TIMBER DECAY FUNGI The fruiting bodies of wood decay fungi vary in size, shape and colour. The type of fungi encountered by pest controllers usually reside in poorly ventilated subfloors, below wet areas of the home, exterior timbers and in areas that retain water in the soil. The durability and type of timbers are factors along with the temperature and environment. Destruction of affected timbers varies with the symptoms involved. Removal of the moisture source usually alleviates the problem. Fungal decay is attractive to termites and if the problem is not rectified it may well lead to future termite attack. DECAY CAUSED BY WOOD DECAY FUNGI We claim no expertise in building and if any evidence of fungal decay or damage is reported you should consult a building expert determine the full extent of damage and the estimated cost of repairs or timber replacement (See Terms & Conditions). Blistering and chalky paint allows water to enter timbers and will result in wood decay over time. The early signs of wood decay may be timbers discolouring. Urgent rubbing back, sealing and repainting to protect them should be carried out. This may stop the process. However, you should consult a building expert and obtain expert advice as to whether timber repairs are required or whether rubbing back, sealing and repainting is all that is required. MOULD, MILDEW (non-wood decay fungi) Mildew and non-wood decay fungi is commonly known as Mould and is not considered a Timber Pest. However, Mould and their spores may cause health problems or allergic reactions such as asthma and dermatitis in some people. No inspection for Mould was carried out at the property and no report on the presence or absence of Mould is provided. Should any evidence of Mould happen to be noticed during the inspection, it will be noted in the Other Information (5.11) section of this report. If Mould is noted as present within the property Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 12 16/07/2006

and you are, concerned as to the possible health risk resulting from its presence then you should seek advice from your local Council, State or Commonwealth Government Health Department or a qualified expert such as an Industry Hygienist. CHEMICAL DELIGNIFICATION General Description of Attack Surface of timber appears very hairy; and wood and hairs separate. Economic Significance: Chemical Delignification of wood in service is only rarely encountered and then only in certain areas. I.e. (buildings that are located in close proximity to the sea, large chemical factories or major arterial roads that have heavy traffic). In the past, this type of timber damage has been referred to by many different terms, Hairy Timber or Defibrosis. In the early 1990, it was agreed that the true description of this type of timber deterioration is Chemical Delignification. This term describes the deterioration in its true form; the lignin in timber is damaged by airborne chemicals. Lignin is the natural glue that holds the fibres of wood together and is therefore a major component of any wood. When the lignin is broken down or damaged the fibres then detach from each other creating a visible hairy surface to a section of the timber, as the delignification progresses the structure of the timber section is weakened and therefore Chemical Delignification is regarded as a structural pest of timber in service.small dimensional timber members such as roof tiling battens may collapse when the wood becomes defribrated. However, in large dimensional timber members such as rafters, bearers and joists, Delignification takes many years to affect the strength of timbers to the point of collapse. Chemical delignification is more common in species of softwood timbers although certain species of softwood are more prone to damage than others. The most common timber species that is used in buildings that we find is damaged by Chemical Delignification is the Douglas fir otherwise known as Oregon. Douglas fir is an imported timber species that originates in Northern America and Canada. Chemical Delignification may only occur after timbers have been exposed to airborne substances for a relatively long period of time; it is not common to find chemical delignification in buildings that are younger than ten years. Where evidence of Chemical Delignification exists, competent advice (e.g. from a licensed or registered building contractor) should be sought to determine the extent of any structural damage, and as to the need or otherwise for rectification or repair work. It also would be prudent to consider the possibility that the air quality in the area may be affected by chemicals and therefore if any health hazards are present that could cause long-term damage o an occupant s health. CONDITIONS THAT ARE CONDUCIVE (attractive) TO TIMBER PESTS Eliminate wood contact with the ground. Many termite infestations result from structural wood being in direct contact with the soil. Earth-to-wood contact provides termites with easy access to food, moisture, and shelter, as well as direct, hidden entry into the building. Wood siding, latticework, door and window frames and similar wood items should be at least six inches above ground level. Eliminating wood-to-soil contact may require regarding or pulling soil or mulch back from the foundation, cutting the bottom off of wood latticework, or supporting steps or posts on a concrete base. Posts or stairs that are embedded in concrete are also vulnerable to termites since they usually extend all the way through the concrete to the soil. Contrary to popular belief, wood which has been pressure treated is not immune to termite attack; termites will enter pressure-treated wood through cut ends and cracks, and will also build tunnels over the surface. Do not let moisture accumulate near the foundation. Termites are attracted to moisture and are more likely to "zero in" on a structure if the soil next to the foundation is consistently moist. Water should be diverted away from the foundation with properly functioning gutters, downspouts and splash blocks. Leaking faucets, water pipes and air conditioning units and water heater over flows should be repaired on or piped to a drain, and the ground next to the foundation should be graded (sloped) so that surface water drains away from the building. Homes with poor drainage may need to have extra drains installed. Lawn sprinklers and irrigation systems should be adjusted to minimize water ponding near the foundations. Reduce humidity in crawl spaces. High moisture can be caused by any one of the following: poor Ventilation, particularly to the subfloor region is important in minimising the opportunity for Timber Pests to establish themselves within a property, ineffective drainage, leaking pipes, leaking roofs, defective flashing or by concealed termite activity. The areas of high moisture should be investigated by way of an invasive inspection. If high moisture, poor Ventilation was reported then you must have a building expert investigate the moisture and its cause and determine the full extent of damage and the estimated cost of repairs. Never store firewood, lumber or other wood debris against the foundation or inside the sub floor crawl space. Firewood, lumber, cardboard boxes, newspapers, and other cellulose materials attract termites and provide a source of food. When stacked against the foundation they offer a hidden path of entry into the structure and allow termites to bypass any termiticide soil barrier, which is present. Vines, ivy, and other dense plant material climbing on or touching the house should also be avoided. Where practical, dead stumps and tree roots around and beneath the building should be removed, along with old form boards and grade stakes left in place after the building was constructed. Use mulch sparingly, especially if you already have termites or other conducive conditions. Many people use landscape mulch for its aesthetic and plant health benefits. Excessive or improper usage, however, can contribute to termite problems. Termites are attracted to mulch primarily because of its moisture-retaining properties, and the insulation it affords against temperature extremes. The mulch itself is of poor nutritional quality to termites and a non-preferred source of food. Since the moisture retaining properties of mulch are more of an attractant than the wood itself, it makes little difference what type of mulch is used (cypress, pine bark, eucalyptus, etc.). Contrary to popular belief, crushed stone or pea gravel are comparable to wood mulch in terms of attraction, since they also retain moisture in the underlying soil. Where mulch is used, it should be applied sparingly (50MM is usually adequate), and should never be allowed to contact wood siding or framing of doors or windows or to be above the weep holes or concrete slab edge. END OF REPORT Confidential V1.0 COPYRIGHT PestDective - JUNE 2006 UNAUTHORISED USE PROHIBITED Page 13 16/07/2006