Finally dug out the AWG materials that were mailed in December. A little late, but still interesting. Here is the cover letter to shareholders (Dated December 9, 1997 and written by Joseph E. Antonini, Chairman of the Board):
Dear Shareholder:
Enclosed please find a Notice of Annual Meeting and Proxy Statement for the Annual Meeting of Shareholders to be held January 13, 1998 at the Company's offices in Napa, California. We hope that you will be able to attend the meeting.
As some of you know, Mario Andretti and I became involved in the Company
in December of 1996 through acquisition of the stock positions of Darla Perkins and
Philip Diaz. At that time, the Company while producing a very marketable product
was experiencing serious financial difficulties and its continued viability was in doubt. As more fully described in Exhibit D of the Proxy Statement "Business Summary", I and several others have, over the last year, loaned to the Company or guaranteed financing on behalf of the Company in excess of $1,000,000. More specifically, I have guaranteed a bank line of credit to the Company which is currently at $800,000 and may go higher by the time of the Shareholder's meeting. In addition, Bruce Williams, Carl Haas and I advanced the Company $350,000 in December of 1996 which loan was subsequently converted to common stock of the Company. Finally, Mario Andretti and John Caponigro (through an affiliated entity) have loaned the Company an aggregate of $170,000. These funds have been used to pay salaries of employees of the Company, purchase inventory, begin a replanting of the entire vineyard, as well as construct a barrel storage facility, tasting room and refurbished hospitality center at the winery.
Notwithstanding the infusion of capital by myself and the individuals referenced above, the Company has continued to incur ongoing cash flow problems. This can be expected to continue for an extended period of time until the Company is able to produce and market sufficientquantities of wine to cover its ongoing expenses. In order to alleviate cash flow problems and to provide additional capital to grow the Company, the Company has signed a letter of intent with Klein, Maus & Shire to raise between $3,000,000 and $5,000,000 through an offering of Preferred Stock. This Offering is more fully described in the enclosed proxy Statement. If the Company is able to successfully complete this offiering, management believes it will provide sufficient funds to cover cash flow deficits until such time as the Company is able to generate sufficient revenue to cover its costs, complete the entire replanting of the vineyard and complete any additional required improvements to the property. In addition, funds would be available on a modest level for additional acquisitions.
It is anticipated that until such time, if ever, that the public offering is successful, that members and of management will be called upon to either contribute or guarantee additional financing of the Company. However, our ability to continue to do so is severely limited. We are endeavoring to do everything possible to protect our collective investment in the Company. We thank you for your patience and continued support. We hope to see you on January 13, 1998 in Napa, California.
Very truly yours,
<signed>
Joseph E. Antonini
Chairman of the Board |
