Capital Requirements for Growth and Options for Sourcing the Funds

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Capital Requirements for Growth and Options for
Sourcing the Funds
Joseph W. Ciatti Vintage Wine Trust
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Company Background

• Vintage Wine Trust is a Real Estate Investment
  Trust "REIT" that enables wine companies and
  grape growers to outsource their vineyards and
  other real estate assets and release capital for
  investment in higher returning areas and
  expansion, in order to increase profitability
• Vintage Wine Trust is the only REIT in the U.S.
  to focus solely on the wine grape industry. VWT
  invests in vineyards and other wine industry
  assets including crushing, processing and storage
  facilities, and simultaneously enters into
  specialty-finance leases with branded wineries,
  bulk wine producers and independent grape growers
  as operating-lessees in the U.S. and Canada
• VWT completed its private offering of common
  stock for 159.4 million in March 2005, and
  secured debt financing of up to 270 million,
  providing total initial capital of over 400
  million. As of January 2008, VWT has acquired
  approximately 170 million of vineyards, wineries
  and wine related assets which have been leased
  back to the sellers or to third-party lessees
• VWT's strategy is to be the leading provider of
  specialty-finance real estate capital to the wine
  industry, both private family businesses and
  multi-national public companies

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VWT Business Model and Value Proposition

• Triple Net Lease REIT
• Purchase established and operating real estate
  assets and lease them to operating companies
• Pay dividends of no less than 90 of taxable
  income
• VWT has paid a dividend every full quarter of
  operations
• Purchase assets for 100 FMV, and thus, provide
  100 financing to wine industry transaction
  partners
• Compared to 60-70 loan-to-value, requiring
  30-40 equity in traditional mortgage financing
• Cost of capital to operating-lessee is reasonable
  based on blended cost of equity and debt
• Lease rate typically based on 10-year U.S.
  Treasury negotiated number of bps

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California Grape Crush 1992-2007
(estimated)
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California Grape Crush 1992-1999

• During 1992-1999 California fell short of all
  premium wine varieties
• Wineries were forced to go overseas for supplies
  of Chardonnay, Cabernet, Merlot, Sauvignon Blanc
  and Syrah
• Growers throughout the State over planted
  vineyards on speculation

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California Grape Crush 2000-2007

• California grape crush was in excess starting
  with the 2000 crush
• 9/11 affected demand
• Grapes were in excess in all areas in California
  including premium areas
• 2005 Crush was the largest in California history
  at 3.76 million tons which had large excesses of
  bulk wines in the market place and large excesses
  from Australia, France, Italy and Spain

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California Grape Crush 2007

• In 2007 stability finally arrived with an
  estimated crush of 3.0 to 3.1 million tons
• Bulk wine inventories are depleted from the large
  2005 crush in balance with 2006 and 2007
• Potential for shortages after the 2007 crush of
  all white varieties Chardonnay, Sauvignon Blanc
  and Pinot Grigio
• Limited excess of red varieties, Red Zinfandel
  and Cabernet, and more of a balance with Merlot
  and Syrah
• For the first time in years major buyers are
  committing to multi-year contracts for grapes in
  almost all areas
• Grapes that remain in short supply are Pinot
  Noir, Pinot Grigio, Riesling and potentially
  Sauvignon Blanc and Chardonnay

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2008 The Best Area to Have a Vineyard

• Grape Prices
• Value of Vineyard and Value of Plantable Land
• Best Area for Hot Varietals and Grape Contracts
• Delta and Clarksburg
• Monterey County
• Sonoma County
• Napa County
• Santa Barbara County San Luis Obispo
• Lodi
• Districts 12-13 Modesto and Madera
• Mendocino and Lake Counties
• Paso Robles

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General InformationDunnigan Vineyard
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Original YieldDunnigan Vineyard July 2007
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Updated YieldDunnigan Vineyard December 2007
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Farming CostsDunnigan Vineyard December 2007
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Original PricesDunnigan Vineyard July 2007
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Coverage Analysis Original PricesDunnigan
Vineyard July 2007
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Updated PricesDunnigan Vineyard December 2007
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Coverage Analysis Updated PricesDunnigan
Vineyard December 2007
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Replant InformationDunnigan Vineyard 2008
Planting
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Replant Coverage AnalysisDunnigan Vineyard
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Summary

• Overall a positive outlook for grapes and
  vineyard values