project knight spring 2014.ppt - maher advisors, inc. · 2014. 4. 21. · 3 key investment...

Information Memorandum

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This Information Memorandum (the “Information Memorandum”) has been prepared by Maher Advisors Inc. (“MA”) solely for informationalpurposes from materials and information supplied by Fortress Vineyards (“Fortress”) for the evaluation of an acquisition or investment inFortress and is being furnished through MA, in its capacity as the Fortress’ exclusive advisor, solely for such purposes.

The information contained herein has been prepared to assist interested parties in making their own evaluation of Fortress and does notpurport to be all-inclusive or to contain all of the information that a prospective strategic partner or acquirer may desire. While the informationcontained herein is believed to be accurate, MA has not independently verified any of the information contained herein, and no representationor warranty is made by either MA or Fortress as to the accuracy, reliability, or completeness of this Information Memorandum. In all cases,interested parties should conduct their own investigation and analysis of Fortress and the data set forth in this Information Memorandum. MAand the Company expressly disclaim any and all liability for any representations (whether expressed or implied) contained in, or anyomissions from, this Information Memorandum or any other written or oral communication transmitted to the recipient in the course of therecipient’s evaluation of Fortress. The only representations and warranties made by Fortress will be set forth in a definitive agreementapproved by each party in its sole discretion.

This Information Memorandum includes certain statements, estimates, and may include projections provided by Fortress that reflectmanagement’s views regarding the anticipated future financial and operating performance of Fortress. Such statements, estimates, andprojections reflect numerous assumptions concerning anticipated results. As these assumptions may or may not prove to be correct andthere are numerous factors which will affect the Fortress’ actual results (many of which are beyond Fortress’ control), there can be noassurances that any projected results are attainable or will be realized. Fortress’ actual results may differ materially from those set forth inthis Information Memorandum. Accordingly, no representations are made as to the accuracy or reasonableness of such statements,estimates, or projections.

Maher Advisors will act as the primary contact for the recipients. Recipients are not to contact Fortress directly. All questions regardingFortress should be directed to:

Sean MaherMaher Advisors Inc.

1101 Vintage AvenueSaint Helena, CA 94574

Tel: (707) 963-8282Fax: (415) 963-1280

www.maheradvisors.com

Information Disclosure

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Key Investment Considerations

Opportunity to acquire a significant parcel of land—approximately 340 acres—in the attractive Red Hills Appellation of Lake County, California

High elevation (from 2,000 – 2,400 feet) combined with the cooling effects of Clear Lake promote good acidity, improved tannic structure, darker color and more concentrated fruit character

Approximately 70 net vine planted acres with significant expansion opportunity of an additional 98 plantable acres

Wines produced from the estate are typically 90+ point rated wines (rated by various credible sources)

Volcanic soils are ideal for Bordeaux and other red varietals, plus award-winning Sauvignon Blanc

Lake County grape pricing trends over the past few years have been favorable across a number of varietals

Large well with plenty of water for irrigation (300+ gallons per minute)

Excellent proximity and access off of State Highway 29

Highly-regarded vineyard location with neighbors such as Beckstoffer Vineyards’ Crimson Ridge Vineyard

Potential to also acquire the Fortress Vineyards brand (if desired)

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Property Overview and General Information

Offering Price: $3,600,000

Overview: This Lake County vineyard property represents an opportunity to purchase a unique vineyard site producing high quality premium grapes and wine

Acreage: Approximately 340 total acres with approximately 70 acres planted with approximately 100 plantable acres

Address: 6700, 6800, 6900 Wilkinson Rd., 7590, 7530 Highway 29 and 6277 Konocti Rd. in Kelseyville, CA 95451

Zoning: RL (Rural Lands)

Elevation: 2,000 – 2,400 feet

Water: One well, dug in 1999, 635 feet deep, 300+ gallons per minute, 8.32 inch casing, pumped by diesel generator; plenty of irrigation water from the well for the existing vineyard and future development

Appellation: Red Hills Lake County Appellation

Pictures from Property

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Parcels: The 340 acres is comprised of six separate parcels located in Kelseyville, California. The elevation ranges from 2,000 – 2,400 feet, which provides a cooling effect for grape growing.

Soils: Soils are mapped primarily as Benridge-Konocti Association. Located on the Mt. Konocti volcano itself, the highly diverse volcanic soils deliver complex wines. The slopes and rocks provide excellent drainage and are ideal for growing high quality Cabernet Sauvignon.

Climate: The vineyards enjoy a unique “Lake Effect” which is a constant, daily wind coming directly from the Lake below which cools the vines maintaining great acidity in the grapes. With the vineyard above the fog line, the fruit is in sunshine from sunrise to sunset, this combined with the Lake Effect produces very balanced fruit.

Irrigation and Frost Control: Drip irrigation is installed throughout the vineyard. The vineyard is above the frost line. Overhead misters have been installed in certain slightly lower lying sections, but the owners have found they do not need to use the.

Parcel Data

Parcel Number Acres

007-018-02 59.70007-018-04 59.30007-018-11 117.73007-029-04 20.00007-029-05 60.00009-003-20 23.27Total 340.00

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Red Hills Appellation Neighboring Producers: The Red Hills Appellation includes numerous well-respected vineyard sites in addition to Fortress Vineyard. Two of the largest and most well-known vineyards and owners are:

Snows Lake Vineyard: Gallo purchased the approximately 2,000 acre property in 2012; it was the corporations first land purchase in Lake County. The property was previously owned by George Myers who developed the vineyards in 2001. The primarily Cabernet Sauvignon vineyard is planted to approximately 800 acres and has produced award winning wines, with the grapes notable for their quality.

Amber Knolls, Red Hills and Crimson Ridge: Beckstoffer Vineyards is one of the largest vineyard owners in the AVA with these three vineyards which total approximately 1,300 acres. Amber Knolls and Red Hills vineyards are located on the southwest side of Highway 29 while the Crimson Ridge vineyard is located on the south slope of Mt. Konocti around the corner of the mountain from the Fortress Vineyard. All three vineyards are planted primarily to Cabernet Sauvignon with some Zinfandel, Malbec, and Sauvignon Blanc.

Snows Lake/ Red Hills

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Block Map & Vineyard Data

Vineyard DataBlock Map

1

2

3

4

56

78

9

1011

12

1314

15

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Block Varietal Clone Planted Acres

Block #1 Sauvignon Musque #27 1998 11.20Block #2 Sauvignon Blanc #1 1999 11.70Block #3 Sauvignon Musque #27 1999 5.00Block #4 Albarino #1 2001 1.00Block #5 Semillon #1 2001 4.30Block #6 Petite Sirah #3 2002 3.60Block #7 Semillon #1 2002 3.40Block #8 Cabernet Sauvignon #337 2002 2.60Block #9 Tempranillo #12 2002 4.70Block #10 Semillon #1 2002 3.70Block #11 Petite Sirah #3 2003 3.00Block #12 Tempranillo #12 2002 2.10Block #13 Sauvignon Musque #27 2001 6.00Block #14 Cabernet Sauvignon #4 2001 2.00Block #15 Tempranillo #12 2001 2.00Block #16 Sauvignon Musque #27 2001 4.00Total 70.30All blocks are planted on 110-R Rootstock680 vines per acre

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Key Wine Reviews & Representative Grape Buyers

Wine Reviews Representative Grape Buyers

Seven 90+ Scores for the 2004-2007 Vintages

Gold Medal Winner and Best of Class (dessert wines)

Fortress 2007 Finale

Top 12 Sauvignon Blancs

2009 Fortress Red Hills Lake County Musque

Clone Sauvignon Blanc

Star Sip: 2009 Fortress Sauvignon Blanc

Made from the musque clone, this distinctive white is aromatic and fresh.

-September 10, 2012

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Equipment Pictures from Property

Equipment Quantity Cost

Diesel Tank 1 1,300.00$ Diesel Tank Stand 1 450.00 Diesel Tank Enclosure 1 315.00 Harvest Trailer 2 2,000.00 Macro Bins - 1/2 ton 80 14,400.00 Kubota M8200 Tractor 1 28,000.00 Rock Rake 1 5,500.00 John Deere 440 Tractor 1 7,000.00 Schmeisers Culti-Plow 1 1,525.00 Ripper 1 1,100.00 Cultivator 1 360.00 Rock Wagon 1 4,900.00 Pellenc Tying Machine 1 1,100.00 Pellenc Auto Pruner 1 1,000.00 Dusters n/a 3,600.00 Pruners n/a 1,000.00 Goldoni Tractor 1 5,100.00 Goldini Tractor 1 3,800.00 Kubota Tractor & Backhoe 1 15,000.00 Gearmore Sprayers 2 3,000.00 Water Truck 1 3,000.00 Hedger 1 600.00 Weedeater 1 500.00 Air Compressor 1 920.00 Chainsaw 1 640.00 Good Water Filter 1 10,000.00 Caterpillar Engine (For pump/well) 1 20,000.00 Pump for well 1 10,000.00 Gearmore Flail Mower 1 6,000.00 Ford Cab-over Flatbed Truck 1 3,000.00 Total 155,110.00$

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APN Aerial Map

007-018-11117.73 acres

007-018-0459.3 acres

007-018-0259.7 acres

007-029-0420.0 acres

007-029-0560.0 Acres

009-003-2023.27 acres

Well

Source: Google Maps. Yellow lines approximate parcel boundaries. “A” denotes property entrance / access.

Entrance

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Potential Plantable Slope Map

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Soils Map

Dick MaherFounder

(707) [email protected]

Sean P. MaherPrincipal


Allison S. HackettAssociate


Dianne MaherPartner


Rodney J. ClarkPrincipal

(707) 501-8164 [email protected]

MMaher Advisors Contact Informationaher Advisors Contact Information

Maher Advisors, Inc.

1101 Vintage AvenueSaint Helena CA 94574

(707) 963-8266

www.maheradvisors.com

Ian MaloneSenior Vice President

(707) 531-7642 [email protected]

The Premier M&A Advisor to the Global Wine Industry

project knight spring 2014.ppt - maher advisors, inc. · 2014. 4. 21. · 3 key investment...

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