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T a b l e Of Co n t e n t s 1.1 Sellers Rights & Disclaimers 1.2 Regional & American Viticultural Areas (AVA) Map 1.3-1.5 Executive Overview 1.3 Purchase Price & Terms 1.4 Nearby Cities & Airports 1.5 Property Location & Access 1.6 The Vineyards & Crop Production 1.7 Wines of Santa Clara Valley AVA 1.8 Crop, Farming & Management Contracts 1.9 Vineyard Appellation 1.10 Irrigation Water 1.11 Main Residence & Guest House 1.12 Building Improvements 1.13 Soils & Underlying Land Value 1.14 Topography 1.15 Partial Legal Description, Zoning, Williamson Act 1.16 Block Data Summary 1.17 Production History 1.18 Varietal Map 1.19 Potential Planatable Map 1.20 NRCS Soils Map 1.21 Slope Map 1.22 Aspect Map 3 4 5 5 5 5 5 5 5 6 6 6 6 6 6 7 8 9 10 11 12 13 14 1.23 Photos 1.24 Arial Photos 1.25 Asscessor Parcel Maps 15-16 17-20 18-23 2
1.1 Se l l e r s Ri g h t s & Di s c l a i m e r s Sellers Rights: Seller reserves the right in its sole discretion to accept or reject any offer, terminate negotiations, withdraw the Property from market without notice, amend the terms, conditions, and acreages being offered, and negotiate with multiple prospective purchasers concurrently until a definitive, legally binding Purchase and Sale Agreement is fully executed by Seller and Buyer. Seller also reserves the right to accept back up offers until the close of escrow, and have the sale of the Property subject to Seller affecting a 1031 tax exchange for suitable property. Sellers Disclaimers: This Copyrighted Information Memorandum has been prepared for Buyer s use in considering the Property for a potential future acquisition, and contains only a general overview of the Property. Although information herein and subsequent information provided are form sources deemed reliable, neither Seller, nor Brokers make any warranties or representations, express or implied, as to the accuracy and completeness of the enclosed Property information. It is Buyer s sole responsibility to conduct an independent investigation and due diligence of the Property and its attributes and characteristics in its entirety. Buyer is strongly advised to use qualified industry professionals to determine the suitability of the Property for Buyers intended use. Buyer is also advised that this Memorandum and Property information is dated, and that changes may have occurred prior to, during, and after the time that this Memorandum was prepared. The Property is being sold in its present As-Is condition, subject to the terms and conditions of a fully executed, definitive Purchase and Sale Agreement. Sellers referenced herein include; Principals, Directors, Officers, Board Members, Shareholders, Partners, Associates, Employees, Legal Counsel, Accountants, Agents, Appraisers, Brokerage and Advisory firms, of Seller. Exclusive Representation Rights: Seller has granted Exclusive Representation Rights to London Properties Ltd. and San Benito Realty for the offering and sale of the Seller s Dunne Ranch Property located in San Benito & Santa Clara Counties, California, U.S.A. This Memorandum shall not be duplicated in any manner. Communications, Offering Process, Viewing of Property: All communications, letters of intent, offers, requests for additional copies of this Memorandum, and viewing the Property shall be made directly by contacting the Brokers below: Viewing by appointment only. 3
1.2 Re g i o n a l & Am e r i c a n Vi t i c u l t u r a l Ar e a s (AVA) Ma p 4
1.3-1.15 Ex e c u t i v e Ov e r v i e w 1.3 Purchase Price: $23,000,000, plus cultural expenses to close of escrow. 1.4 Nearby Cities & Airports: The proximity of the Property to various Cities and their local Airport phone numbers are as follows; Hollister 7 miles (831-636-4365), Los Banos 37 miles (209-827-7034), San Jose 45 miles (408-501-0979), Monterey 49 miles (831-648-7000), San Francisco 76 miles (650-821-5000), Fresno 113 miles (559-454-2052), Napa 117 miles (707-253-4300), Paso Robles 138 miles (805-237-3877), San Luis Obispo 167 miles (805-781-5205), and Santa Barbara 260 miles (805-967-7111). 1.5 Property Location & Access: The Property is located along the southwest intersection of Highway 152 and Highway 156, 2 miles southwest of historic Casa de Fruta, 6 miles north of Hollister and 9 miles southeast of Gilroy. Site address is 7285 Pacheco Pass Highway, Gilroy, California 95020. 1.6 The Vineyards & Crop Production: The Dunne Ranch consists of 394.47 acres of planted vineyards and approximately 345 acres of open pasture that may be suitable for additional winegrape plantings. Summary of planted vineyard acreages; Chardonnay 297.40, Gewürztraminer 58.51, Pinot Noir 26.67, Pinot Grigio 11.89. The age of the planted vineyard blocks range from 1996 through 2007. Average crop production from 2006-2011 is approximately 7.35 tons per acre. Future crop production is estimated between 7.50-8.00 tons per acre. 1.7 Wines of Santa Clara Valley AVA: Although Seller utilizes Dunne Vineyard grapes for their own labels, many other renown wineries (logos below) have also sourced grapes from the Dunne Vineyard including; E&J Gallo, Fetzer, O Neill, Weibel, Vie-del, Pietra Santa, Casa de Fruta, Constellation Wines, Purple Wine Company, McMannis and ZD Wines. A select few awards for the Dunne Vineyard wines are as follows; *Dunne Ranch Chardonnay 2008, 2010 Wine Tasting, 88 Points California State Fair, Silver Medal West Coast Wine Competition *Pietra Santa Dunne Ranch Chardonnay 2007, Silver Houston Livestock Show and Rodeo 1.8 Crop, Farming & Management Contracts: The Property contains external grape crop contracts on the Chardonnay, White Reisling, Pinot Grigio and Pinot Noir. Crop contracts are subject to approval by all wineries. Farm management is available and currently operated by Blackburn Farming Company, Inc. however there are no existing vineyard management contracts on the Property. 5
1.3-1.15 Ex e c u t i v e Ov e r v i e w Co n t d 1.9 Vineyard Appellation: The Property is in both the San Fransico Bay AVA and in the Santa Clara Valley AVA American Viticulture Areas, for additional information please visit www.santaclarawines.com 1.10 Irrigation Water: The Dunne Vineyard is currently irrigated from water delivered by the San Benito County Water District, the irrigation water is delivered to the vineyards via drip irrigation (one emitter per vine). The vineyard is designed to irrigate in 3 sets. The property also contains 3 deep wells which are not needed at the present time. The property also has a valve onsite from the Santa Clara County Water District which is unused and not needed at this time. There is one domestic well located near the main residence. 1.11 Main Residence & Guest House: The Luxurious Estate Home is approximately 6,321± square-feet, contains 5 bedrooms, 4 bathrooms, 1 fireplace and constructed in 2006. The Guest House is 2 bedrooms, 2 bathrooms, 1 fireplace and contructed in 2006. 1.12 Building Improvements: Name Size (square-feet) Foundation Frame Siding Roof Storage 5,000 Concrete Wood Concrete/Metal Metal Hay Barn #1 5,000 Concrete Wood Concrete/Metal Metal Hay Barn #2 5,000 Concrete Wood Concrete/Metal Metal Shop 5,120 Concrete Metal Concrete/Metal Metal Arena 35,000 Dirt Metal Metal Metal Barn 4,624 Concrete Wood Wood Metal Garage/Storage 624 Dirt Wood Stucco Metal Cement Pad/Fuel Tanks 1,404 Concrete Garage/Storage 1,840 Dirt Wood Stucco Comp. Labor House #1 1,232 Pier Wood Stucco Comp. Labor House #2 1,136 Pier Wood Stucco Comp. Residence/Office 1,842 Pier Wood Stucco Comp. Attached Garage 528 Concrete Wood Stucco Comp. 1.13 Soils & Underlying Land Value: The soils on the subject property mainly consist of the following; Los Osos Clay Loam (Lo), Los Gatos Clay Loam (Lv), Los Gatos Clay Loam(LvF2sb), Pacheco Fine Sandy Loam (Pa), Pacheco Silt Loam (Pa), Pacheco Clay Loam, Gravelly Substratum (Pe), Pacheco Silty Clay (Pe), Rincon Clay Loam (RaC2), Reiff Sandy Loam (Re-A), Riverwash (Rw), San Benito Clay Loam (SbG), Sorrento Silt Loam (Sn), Sorrento Silty Clay Loam (SrA), Yolo Silty Clay Loam (Ye). The soils within the Property are the same or of very similar soil type on neighboring properties that are being farmed to various row crop vegetables. 1.14 Topography: The topography is generally level in most planted areas and farmstead, becoming rolling and steeper in the grazing areas and homesite. Elevations range from approximately 160 feet to nearly 600 feet above sea level. 6
1.3-1.15 Ex e c u t i v e Ov e r v i e w Co n t d 1.15 Partial Legal Description, Zoning, Williamson Act: County APN Assessed Acres Zoning Williamson Act Contract No. 2011-2012 Property Taxes Santa Clara 898-24-017 11.94 AR-sr No - $6,557.98 Santa Clara 898-24-018 1.00 RS-sr No - $1,726.70 Santa Clara 898-41-001 82.87 AR-sr Yes 67025 $1,205.64 Santa Clara 898-41-002 19.13 AR-sr Yes 67025 $110.12 Santa Clara 898-41-010 67.26 AR-sr Yes 67025 $2,059.88 Santa Clara 898-41-015 200.79 AR-sr Yes 67025 $483.14 San Benito 016-010-043 374.55 AP Yes 68-100 $38,125.76 San Benito 016-010-044 337.36 AP Yes 68-100 $3,726.90 San Benito 016-010-045 38.25 AP Yes 68-900 $17,785.86 1,133.15 $71,781.98 Santa Clara San Benito AR-sr (AR - Agricultural Ranchlands, sr - scenic road) AP Agricultural Productive RS-sr (RS - Roadside Services, sr - scenic road) 7
D u n n e Ranch 1.16 Bl o c k Da t a Su m m a r y Total Planted Acres 394.47 Potential Plantable Acres 345.00 Gross Acres 1,133.15 Block Varietal Acres Rootstock Clone Spacing Trellis Type Pruning Type Vines/Ac Total Vines Year Planted 1 Gewurtztraminer 34.04 5C 1 9 x 5 Quad Spur 968 32,951 1997 2 Gewurtztraminer 6.37 5C 1 9 x 5 Quad Spur 968 6,166 1997 3 Gewurtztraminer 6.78 5C 1 9 x 5 Quad Spur 968 6,563 1997 4 Gewurtztraminer 11.32 5C 1 9 x 5 Quad Spur 968 10,958 1997 5 Pinot Grigio 11.89 5C 146 8 x 5 Smart Dyson Spur 1,089 12,948 2004 6 Chardonnay 107.28 5C 108 9 x 5 Smart Dyson Spur 968 103,847 1996 7 Chardonnay 118.82 5C 108 9 x 5 Smart Dyson Spur 968 115,018 1996 8 Chardonnay 71.3 5C 108 9 x 5 Smart Dyson Spur 968 69,018 1996 HR1 Pinot Noir 6.23 101-14 777 8 x 5 Smart Dyson Spur 1,089 6,784 2007 HR2 Pinot Noir 9.34 101-14, 3309 667, 777 8 x 5 Smart Dyson Spur 1,089 10,171 2007 HR3 Pinot Noir 2 3309 828 8 x 5 Smart Dyson Spur 1,089 2,178 2007 HR4 Pinot Noir 5.8 3309 667, 115 8 x 5 Smart Dyson Spur 1,089 6,316 2007 HR5 Pinot Noir 3.3 3309 667, 777 8 x 5 Smart Dyson Spur 1,089 3,594 2007 Total 394.47 P l a n t e d Ac r e s b y Va r i e t a l Pinot Noir 26.67 Pinot Grigio 11.89 Gewurtztraminer 58.51 Chardonnay 297.40 8
1.17 Pr o d u c t i o n Hi s t o r y Varietal Acres 2006 Tons Per Acre 2007 Tons Per Acre 2008 Tons Per Acre 2009 Tons Per Acre 2010 Tons Per Acre 2011 Tons Per Acre TPA by Varietal Chardonnay 297.40 1,687.61 5.67 2,122.98 7.14 2,068.10 6.95 3,276.13 11.02 3,137.45 10.55 1,725.79 5.80 7.86 Gewurtztraminer 58.51 367.45 6.28 478.90 8.18 537.13 9.18 749.25 12.81 482.68 8.25 264.09 4.51 8.20 Pinot Noir 26.67 227.98 8.55 166.04 6.23 212.14 7.95 7.58 Pinot Grigio 11.89 47.17 3.97 90.52 7.61 65.69 5.52 71.14 5.98 5.77 Historical Crop Production Average on All Varietals: 7.35 tons per acre 9
1.18 Va r i e t a l Ma p 10
1.19 Po t e n t i a l Pl a n t a b l e Ma p 11
1.20 NRCS So i l s Ma p 12
1.21 Sl o p e Ma p 13
1.22 As p e c t Ma p 14
1.23 Ph o t o s 15
1.23 Ph o t o s Co n t d 16
1.24 Ae r i a l Ph o t o s N o r t h Vi e w 17
1.24 Ae r i a l Ph o t o s Co n t d S o u t h w e s t Vi e w 18
1.24 Ae r i a l Ph o t o s Co n t d S o u t h Vi e w 19
1.24 Ae r i a l Ph o t o s Co n t d E a s t Vi e w 20
1.25 As s c e s s o r s Pa r c e l Ma p s 21
1.25 As s c e s s o r s Pa r c e l Ma p s Co n t d 22
1.25 As s c e s s o r s Pa r c e l Ma p s Co n t d 23