REDINGTON NORTH FOREST -...

Price: $3,730,000

9,984 +/- GIS Acres Redington, Franklin County, Maine

A significant timberland investment, featuring spruce/fir, northern hardwoods,

an extensive road network, and long-term asset growth potential.

REDINGTON NORTH FOREST

Fountains Land Inc, 175 Barnstead Road, Suite 4, P.O. Box 25, Pittsfield, NH 03263 Contact: Patrick Hackley ~ [email protected] ~ (603) 435-7428, Ext. 230 ~ Cell (603) 491-3649

www.fountainsland.com

Reduced from $4,500,000

LOCATION Redington North Forest is located in western Maine, between Rangeley, Stratton and the Carrabassett Valley, an area well known for its scenic lakes, forested mountains and abundance of outdoor recreational activities. Just six miles to the east of the parcel lies the town of Rangeley, a long-time fishing and boating destination, famous for its vast chain of lakes including Rangeley, Cupsuptic, Mooselookmeguntic, Upper Richardson and Lower Richardson Lakes. Less than 10 miles to the north is Stratton, located on the shores of Flagstaff Lake, another premier lake of the region. For decades, Redington North Forest has supported a thriving forest products industry with sawlogs, pulpwood and fiber for the numerous wood markets in the area. These include several softwood and hardwood sawmills, as well as low grade markets in the form of chipping facilities, biomass plants and paper mills, all located within a few hours’ drive. Western Maine is home to a skilled logging and forest products trucking workforce that offers landowners a host of services from harvesting and hauling to road repair, maintenance and construction.

ACCESS/BOUNDARIES Legal access is provided via two gravel roads, one from the north and one from the west, both originating off US Route 16 between the villages of Rangeley and Stratton. Nash Stream Road (the northern access road) serves as the main haul road under a crossing agreement with an adjacent timberland investment company (please see maps). The unmarked road entrance is directly across from the Coplin Plantation historical schoolhouse on the south side Route 16. At the 3.5 mile mark, there is an intersection. The right hand fork, known as West Branch Road, parallels the West Branch of Nash Stream, and continues for another mile before crossing onto the subject parcel. The left hand fork continues for another half mile, crosses over the Skunk

Branch, to an intersection. The right hand turn becomes Black Nubble Road and leads into the property center. Approximately a mile from this turn on the left is Nit Picking Ridge Road, which leads to the Middle East Road and the upper slopes of Crocker Mountain and the Redington Pond Range.

Fountains Land Inc — Specializing in the sale of forestland and rural estates.

An extensive network of all-season gravel roads exists on the property and offers excellent access for long-term timber management.

Redington North is located within western Maine’s scenic Rangeley Lakes Region, and is supported by an abundance of forest products markets and a skilled logging workforce.

ACCESS/BOUNDARIES (CONTINUED)

A secondary deeded access approaches from the west through Dallas Plantation township via Oddy’s Road off Route 16, just a few miles north of Rangeley. This road continues east for approximately 3.5 miles, connecting to Quill Hill Road which then enters the northwest corner of the property. Redington North has over 23 miles of all-season gravel roads and another 3.5 miles of winter road. Many of the roads are constructed of shale-based stone, and extend into the property’s upper reaches and valleys to facilitate landscape-level forestry. Three shale pits exist on the property providing ideal road surfacing material; shale breaks readily when excavated and packs well on road surfaces. Parcel acreage is not indicated in the deed history and no survey is available. Tax records indicate 10,989 acres; however, this acreage includes a ±735-acre parcel to be retained and become part of the adjacent Dallas Company ownership. Excluding the acres to be retained, the subject parcel calculates to 9,984± GIS map acres. All of the maps and timber data in this report are based on the 9,984 GIS calculated acreage, which has been field checked (in association with the timber inventory) and cross-referenced using aerial photography, the Maine GIS data bank, and other map sources provided by the ownership. This acreage and associated maps are NOT survey accurate and thus acreages may be unreliable. Therefore, buyers should not rely on them to precisely locate deeded boundary lines in the field. Property boundaries are in fair condition and exist as yellow and/or red painted tree blazes. Boundaries along the south and west summits are faint due to high elevation conditions.

SITE DESCRIPTION Redington North’s terrain varies widely from moderate, rolling slopes, punctuated by small plateaus, to steep mountainous terrain above 3,000’ in elevation. The parcel is distinguished by a prominent, cone-shaped mountain called Black Nubble which rises up from its center. The Redington Pond Range and the lower slopes of Crocker Mountain define the parcel’s eastern border that, along with Black Nubble, form the main watershed for Nash Stream, a tributary of the Dead River. The south face of Black Nubble feeds another stream—the West Branch of Nash Stream which winds its way through the parcel’s western section. Forest soils are mostly of well-drained, glacial till composition which favors northern hardwoods, red spruce and balsam fir. Pockets of poorly-drained soil are limited to stream valleys, lower mountain slopes and the borders of drainage swales. With the exception of these areas, the majority of terrain and soil types are suitable for year-round harvesting operations. A comprehensive soil survey map and soil description was developed in 2003, as part of the adjacent ownership’s Redington Mountain Wind Power proposal, and are available in the Fountains website data room.


Above: A section of the upper West Branch Road, part of the 23-mile internal road network, which benefits from the property’s three shale pits.

Redington North Acreage Summary

Acreage

Acreage

Totals

Type < 2,700’ ASL > 2,700’ ASL

Forest 6,687 3,007 9,694

Landings 70 3 73

Roads 153 5 158

Wetlands 52 7 59

TOTALS 6,962 3,022 9,984

LAND USE REGULATION COMMISSION

All forestry and development activities in Redington North Forest fall under the jurisdiction of the Land Use Regulatory Commission (LURC). LURC was created by the Maine Legislature in 1971 to serve as the planning and zoning authority for the state’s townships, plantations and unorganized areas. The Commission has land use regulatory jurisdiction over these areas because they have no form of local government to administer land use controls, or they have chosen not to administer land use controls at the local level. For more information about LURC, go to www.maine.gov/doc/lurc/about.html.

Timber Harvesting: About two thirds of the parcel acreage falls within LURC’s “General Management Subdistrict” (M-GN) which is compatible with long-term forestry practices in accordance with state forestry laws, including Best Management Practices for erosion control and water quality. The remaining third of the parcel acreage falls within LURC’s “Mounta in Area Pro tec t ion Subdistrict” (P-MA). Although primarily meant for areas that are above 2,700’ ASL, it can also include areas below that elevation if similar physical and vegetative conditions exist. The purpose of the P-MA subdistrict is to regulate land use activities in mountain areas in order to limit soil erosion, protect water quality, and preserve scenic values and recreational opportunities. Timber harvesting and road-building has occurred within the property’s P-MA subdistricts under an existing approved LURC permit.


The entire western slope of Crocker Mountain (4,168’ ASL) is contained within Redington North Forest. The property’s high elevations offer sweeping, long-distance views of western Maine’s mountains, winding riv-ers and vast lakes that stretch to the horizon in all directions. Given its regional location and mountain character, Redington North is a timber investment enhanced with significant recreational qualities.

A softwood thinning was conducted in the P-MA subdistrict last winter leaving good spacing in the residual pole stand.

TIMBER RESOURCE Redington North Forest is a long-established timberland investment property whose performance will be measured by asset appreciation over the coming decades. Dominated by red spruce and balsam fir growing on well-drained upland sites, the investment is positioned for strong physical growth, product shifts, and stumpage price appreciation. The latter provide the opportune buyer an advantage as current low stumpage prices are poised for appreciation as demand for structural timber rebounds during the next building cycle. Additionally, pulpwood and other low-grade product prices will inevitably rise as pressure builds to supply the region’s growing alternative fuel markets (pellet, bio-fuel and wood-fired electric power facilities). With low annual taxes and a fully-developed road infrastructure (over 23 miles of gravel roads), the forest represents a low maintenance and low risk investment for the patient long-term investor. 2009 Timber Inventory: Timber information in this report is based on an April 2009 timber inventory conducted by Fountains Forestry, using random point sampling with 594 BAF 10 factor points taken. The MultiCruise Program was used to process the timber data. Sampling statistics are favorable with ±6.92% for all products combined and ±12.86% for sawlogs at the 95% confidence level. One year of growth has been applied to inventory volumes using US Forest Service FIA growth rates for Maine as follows: hardwood pulpwood 2.38%, softwood pulpwood 1.85%, hardwood sawtimber 2.86%, and softwood sawtimber 2.02%. The resulting volume is 17.084 million board feet (1.8 MBF/commercial acre) and 56,134 pulpwood cords (5.8 cords/commercial acre). Total volume per commercial acre is 9.32 cords. When considering total volume, the data reveals a forest that is evenly split between softwood and hardwood species (Figure 1). Timber graphics presented in this report are based on the original inventory data and not the volumes adjusted for growth. Growth adjusted volumes and corresponding values are summarized on the Timber Valuation on the following page. Capital Timber Value (CTV) has been set at $2,986,000 ($299/ac), a figure that represents 80% of the asking price, leaving a residual land value of $74/acre. The purchase price to capital timber ratio (PP:CTV) is set at 125%. Complete timber inventory data, as well as other property information is available in the Fountains Data Room located at the fountains land website - access code is “blacknubble.”

Figure 1: Total species composition is nearly evenly split between spruce/fir and the hardwoods.


Above: Redington North Forest contains vast stretches of young spruce/fir stands, well positioned for robust appreciation.

Hardwood49%

Softwood51%

Hardwood vs Softwood as % of Total Volume

REDINGTON NORTH FOREST

Timber ValuationPrepared By

FOUNTAINS FORESTRY INCORPORATED

Redington Township, Franklin Co., ME 9,984 Acres5/1/2009, Updated 10/8/09, Updated 2/9/10 9,694 Commercial Acres

Species Volume Unit Price Range Total ValueMBF/CD Low High Likely Likely

Sawtimber - MBF (International 1/4")Spruce/Fir 13,245 73.00 125.00 112.24 1,486,695Sugar Maple 647 175.00 275.00 249.81 161,615Yellow Birch 518 180.00 280.00 258.18 133,865White Birch 561 75.00 125.00 113.88 63,843Hardwood Tie Log 1,215 20.00 36.00 32.49 39,473Sugar Maple Tie Log 598 25.00 40.00 34.76 20,803Cedar 71 70.00 110.00 100.00 7,147Red Maple 85 55.00 100.00 80.00 6,827Aspen 79 30.00 50.00 45.00 3,570Hemlock 50 31.00 50.00 45.00 2,256White Pine 13 90.00 165.00 150.00 1,912

Pulpwood - CordsHardwood 34,462 11.00 20.00 16.48 567,924Spruce/Fir 18,132 14.00 26.00 23.79 431,367Aspen 2,205 15.00 24.00 21.88 48,260Cedar 1,272 5.00 9.00 8.00 10,177Hemlock 29 8.00 16.00 12.57 359Pine 34 6.00 11.00 9.70 326

Totals

Sawtimber Total 17,084 MBF $1,928,006Sawtimber Per Acre 1.711 MBF $193Sawtimber Per Comm. Acre 1.762 MBF $199

Cordwood Total 56,134 Cords $1,058,413Cordwood Per Acre 5.6 Cords $106Cordwood Per Comm. Acre 5.8 Cords $109

Total Per Acre $299

Low High Likely

$2,464,000 $3,177,000 $2,986,000

Unit Values are a weighted average for areas below 2700' and above 2700'. Values above 2700' reflect decreased operability and P-MA LURC zoning

Total Value

HW Sawtimber 2.86%, SW Sawtimber 2.02%,resulting in a standard error of ±6.92 for total volume and ±12.86 for sawlog volumeThe volumes and values reflect estimated total capital value of merchantable timber.

The volumes and values are not a liquidation value.Prices are averages for the area and are adjusted to reflect, access, quality and operability of the site.

One year's growth applied to inventory volumes using the following rates (calculated from FIA data): HW Pulpwood 2.38%, SW Pulpwood 1.85%, BASED ON A STRATEFIED CRUISE BY FOUNTAINS FORESTRY CONDUCTED DURING APRIL AND MAY, 2009 RESULTING IN 594 10 BAF PLOTS

Figure 3: Sawlog volume is dominated by spruce/fir.


The majority of spruce/fir stands on Redington North Forest are in the pole size category.

Spruce/Fir78%

Sugar Maple7%

Yellow Birch6%

White Birch6%

Red Maple2%

Other Softwood1%

Sawlog Volume by Species

TIMBER RESOURCE (CONTINUED)

Total Volume: Species composition supports a mixedwood type, dominated by spruce and fir, with a developing birch and maple component. Softwoods (comprised of nearly all spruce/fir) represent 51% of total volume with a mix of hardwoods representing the 49% balance (Figure 1). While spruce and fir dominate species composition, developing birches and maples together comprise 44% of total volume (Figure 2). Sawlog Volume: As depicted in Figure 3, sawlog volume largely consists of spruce and fir, which account for 78% of total sawlog volume. As a structural timber product primarily used in the housing and general construction markets (combined with excellent regional sawmill outlets), strong appreciation for these softwood species is anticipated over the coming decade. Complementing this resource is a young birch and maple component, well adapted to the property’s soils and climate conditions.

Figure 2: Spruce and fir dominates total volume, while the birches and maples together account for much of the balance (44%).

Spruce/Fir50%

White Birch16%

Yellow Birch12%

Sugar Maple11%

Red Maple5%

Aspen3%

Other Softwood2%

Other Hardwood1%

Total Volume by Species


TIMBER RESOURCE (CONTINUED) Sawlog Value: Figure 4 portrays sawlog volume vs. value, indicating that spruce/fir holds most of the forest’s sawlog CTV. With all sawlog species combined, their value comprises 65% of total CTV, representing a reasonably high sawlog value to total CTV ratio. Diameter Distribution: While diameters are well represented across the size spectrum, the majority of stems are pole-size, with average DBH for all products combined at roughly 9.” Sawlog DBH average is nearly 10.5” (see figure 5). This diameter distribution indicates that, although the forest is decades from maturity, its mostly pole-sized resource will benefit from the value-added process of product shifting—e.g. pulpwood into sawlogs. Figure 6 portrays the sawlog diameter distribution for the three main specie types, with average spruce/fir DBH at 9.5” and both the maples and birches at just under 12.” Stocking: The timber data reveal a forest-wide basal area of 52.2 ft2, a stocking level that is below the optimum level for full site utilization. As the forest contains a diverse mix of stand types, many areas are fully stocked, while recently harvested units are generally under-stocked. Stem quality is average for the region, while growth rates for the softwoods are superior given the forest soils that are predominately well-drained upland sites.

Figure 5: The abundance of stems in the 5” to 11” diameter classes reveals a forest in the asset appreciation phase.

Figure 6: High demand species dominate the sawlog component with much of this resource in a developing stage.

Figure 4: Spruce/fir holds the majority of sawlog CTV.

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A bird’s eye view looking northward along the Middle East Road system of Redington North Forest. The broad slopes of Crocker Mountain loom in the upper right corner of the photo. Photo taken just prior to spring leaf-out.


TIMBER RESOURCE (CONTINUED)

Harvest History: The table at the right details the current stand structure and general species composition to provide a better understanding of Redington North’s harvest history. As evidenced on the photo below and the Forest Type & Harvest History map contained in this report, the forest has experienced a long, resilient history of growth, harvest and regeneration. Although not intended to be a precise type map, the Forest Type & Harvest History map offers the investor a general classification of forest age classes and the associated year of harvest.

Forest Type Harvest History

Type Acres Harvest Year Acres

Hardwood Poles 1,160 1-5 Years 2,500

Hardwood Sawtimber 838 5-19 Years 3,976

Mixed Saplings 100 10-20 Years 756

Mixed Poles 4,147 20+ Years 2,462

Mixed Sawtimber 887 TOTAL 9,694

Softwood Poles 1,053

Softwood Sawtimber 521

TOTAL 9,694

Fountains Land Inc. is the exclusive broker representing the seller's interest in the marketing, negotiating and sale of this property. Fountains has an ethical and legal obligation to show honesty and fairness to the buyer. The buyer may retain brokers to represent their interests.

All measurements are given as a guide, and no liability can be accepted for any errors arising therefrom. No responsibility is taken for any other error, omission, or misstatement in these particulars, nor do they constitute an offer or a contract. We do not make or give, whether in these

particulars, during negotiations or otherwise, any representation or warranty in relation to the property.

PROPERTY TAXES, TITLE & DEED

Redington North (Tax Map #FR005) is enrolled in the State of Maine’s Tree Growth Tax program - a municipal tax based on the land’s productivity to grow timber, rather than the fair market value. 2008 Tree Growth taxes were $11,749.13 on 10,989 taxed acres or $1.07/acre. It should be noted that this acreage includes the 735-acre parcel that will be retained by the ownership after the sale. New taxes (based on 9,984 GIS acres) will be approximately $10,683. The Tree Growth tax rate is calculated for each county from tree growth rates measured by the U.S. Forest Service. This makes for a much lower property tax (in most cases). If the land has little potential for any use besides timber, the tax savings may be very small or not at all. The higher the property values in the town, the greater the savings. For more information, contact the Maine Forest Service at (207) 287-2791 or go to www.maine.gov/doc/mfs/woodswise/text/growth.html. Commercial Forestry Excise Tax Maine landowners of 500 acres or more of commercial forest land are subject to a Commercial Forestry Excise Tax (CFET). The purpose of the tax is to partially offset the costs of forest fire protection provided by the Maine Department of Conservation. The 2008 CFET for Redington North Forest was approximately $4,143. Redington Mountain Wind Power Easements Redington Mountain Wind Power LLC (RMW), a private wind power company based in Yarmouth, Maine, owns two adjacent parcels along the southern boundary - a 496-acre parcel on the summit of Black Nubble, and a 517-acre parcel encompassing a portion of the Redington Pond Range. The two parcels have crossing rights over existing Redington North Forest roads and pre-designated areas where access roads and transmission lines could be built should a wind power project be approved by LURC. These rights and easements are compatible with long-term forest management activities and described in a series of deeds and documents that can be found on Fountains’ website data room. Password is blacknubble. RMW rights and easements through the property are detailed on the attached property maps. Additional information about the RMW wind power proposal can be found via Google Search: “Redington Wind Farm Development Application.” The property is owned by the Dallas Company whose deed is recorded at the Franklin County Registry of Deeds, Book 1496, Pages 212.

Nash Stream runs through the forest and serves as the drainage for all terrain east of the Black Nubble.


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9,984 GIS AcresRedington Township, Maine

Redington North ForestLocus Map

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Map produced from information provided by Owner, a site plan prepared by DeLuca-Hoffman Associates, Inc. titled "Redington Wind Farm Project Base Map With LURCZones", aerial photography, GPS and reference information obtained from ME GIS.

Boundary lines portrayed on this map are approximate and could be different than the actual location of boundaries found in the field.


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9,984 GIS AcresRedington Township, Maineq


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Forest types were delineated in an effort to assist investors in better understanding stand dynamics found on the property. However, type determinations are based on broad type definitions and are not based on stand level data.

NOTE:

Broad Forest Types

Hardwood Poles

Hardwood Sawtimber

Mixedwood Saplings

Mixedwood Poles

Mixedwood Sawtimber

Softwood Saplings

Softwood Poles

Softwood Sawtimber

Cutting History

Approximately 1-5 Years Ago



Approximately 20+ Years Ago





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