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1 Philip J. Terry (SBN 148144)
Justin D. Hein (SBN 249275)
2 CARLE, MACKIE, POWER & ROSS LLP
100 B Street, Suite 400
3 Santa Rosa, California 95401
Telephone: (707) 526-4200
4 Facsimile: (707) 526-4707
pjterry@cmprlaw.com
5 jhein@cmprlaw.com
6 Daniel A. Reidy (SBN 139321)
REIDY LAW GROUP LLP
7 1230 Spring Street
St. Helena, CA 94574
8 Telephone: (707) 963-3030
dan@reidylawgroup.com
9
10 Attorneys for Plaintiffs
3840 STONEBRIDGE, LLC, an Ohio Limited Liability Company
11 and M. DAVID JESTER, an Individual
12 SUPERIOR COURT OF THE STATE OF CALIFORNIA
13 COUNTY OF NAPA
14 3840 STONEBRIDGE, LLC, an Ohio Limited Case No: 24CV000226
Liability Company, and M. DAVID JESTER,
15 an individual, DECLARATION OF COURTNEY PROSE
IN SUPPORT OF PLAINTIFFS’
16 Plaintiffs, MOTION FOR PRELIMINARY
INJUNCTION AND APPOINTMENT OF
17 v. RECEIVER
18 AUBURNJAMES WINERY, LLC, a Delaware Date: May 8, 2024
Limited Liability Company, and MATT Time: 8:30 a.m.
19 OSPECK, an individual, DOES 1-100, Dept.: A
inclusive,
20
Defendants. Complaint filed: February 15, 2024
21 Trial Date: None
22 Judge: Hon. Cynthia P. Smith
Dept. A
23
24 I, Courtney Prose, declare:
25 1. I have personal knowledge of the following facts and am competent to testify as
26 to the truth of those facts if called as a witness.
27 2. I have worked exclusively in the wine industry for nearly 24 years in senior and
28 executive roles at major wineries at which I was responsible for leading all aspects of wine
CARLE, MACKIE, 1
POWER & ROSS LLP
DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY
INJUNCTION AND APPOINTMENT OF RECEIVER
1 inventory and supply chain management, and cost of goods. I have developed and led initiatives
2 to exit surplus inventory of both case goods and bulk wines. This work included conducting
3 wine inventory appraisals, working with audit partners, and partnering with accounts to create
4 exit plans for wines and destruction of non-salable wines. I am currently the principal of CP
5 Wine Consulting which is primarily engaged in the business of conducting wine inventory
6 evaluation and appraisal, exit plans, and related services. I have a BA degree in Accounting
7 from the University of San Francisco. My C.V. is attached hereto as Exhibit A.
8 3. In this case, I was hired by Plaintiffs to review and provide an opinion as to the
9 value of the bulk wine and finished goods (cased goods) inventory belonging to AuburnJames
10 Winery, LLC (“AJW”), and to review certain financial reports and render my opinion as to the
11 condition and sustainability of AJW.
12 4. On or about January 22, 2024, I was provided with a finished (cased) goods
13 inventory list with pricing dated “12/31/23.” I received this list in an email from Plaintiffs’
14 counsel, Daniel Reidy, who informed me that the list and pricing had been provided to Mr. Reidy
15 by AJW. A true and correct copy of that document is attached hereto as Exhibit B.
16 5. On or about January 26, 2024, I was provided with a bulk wines inventory list
17 with pricing for wines stored in tanks and barrels. I received this list from Plaintiffs’ counsel,
18 Daniel Reidy, who informed me that the list and pricing had been provided to Mr. Reidy by
19 AJW. A true and correct copy of that document is attached hereto as Exhibit C.
20 6. On February 12, 2024, I physically inspected AJW’s inventory at AJW’s winery
21 located at 1001 Silverado Trail South, Saint Helena, CA 94574. Matt Ospeck, who was
22 identified as the owner of AJW, was present at the inspection.
23 7. Based on my careful review of the bulk wine and finished goods inventory and
24 pricing lists, my visual inspection of actual goods stored at AJW, and additional research to
25 determine market values, which among other things included reading reviews of AJW wines by
26 wine critics, and other pertinent marketplace information, I prepared two reports: one for bulk
27 wines and the other for cased goods inventory. In so doing, I took AJW’s reports and then added
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CARLE, MACKIE, 2
POWER & ROSS LLP
DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY
INJUNCTION AND APPOINTMENT OF RECEIVER
1 additional columns showing current fair market values for each vintage, varietal, and blend that
2 AJW had listed. True and correct copies of my reports are attached hereto as Exhibits D and E.
3 8. My conclusions, and as reflected in my reports, are that the prices set forth in
4 AJW’s inventory and pricing lists are grossly inaccurate and overestimated. In the finished
5 goods report in Exhibit B, AJW shows a “Total Retail Value” of $7,629,060. To get to this
6 figure, AJW assigns retail prices for older vintages (that for whatever reason did not sell) that are
7 wholly unrealistic. For example, the final item in the report is for “20 Rosé” and shows 3,483
8 cases (41,796 bottles) at a retail price of $32.00 per bottle for a total retail value of $1,337,472.
9 Current Rosé vintages in the marketplace are 2022 with 2023 being bottled and released this
10 Spring. A 2020 Rosé is not salable at $32.00 per bottle, and no distributor or broker would
11 consider taking this wine, even if discounted to less than a few dollars per bottle. Thus, in my
12 opinion, this one-line item alone reduces the $7,629,060 retail value claimed by AJW by nearly
13 $1,300,000. It is also notable that the 2020 Rosé is not offered for sale on the AJW website,
14 which in my opinion indicates that it knows this wine is unsalable and may perhaps be looking to
15 liquidate the inventory as a whole, which in a best-case scenario may fetch $2 to $5 per bottle.
16 9. Further examples of gross inaccuracies and overestimations are the line items for
17 “14 1001 Prop Red”, “15 1001 Prop Red” and “15 Speedster,” which account for 1,938 cases
18 and collectively claim a retail value of $1,690,560 ($80.00 per bottle). These nearly 10-year-old
19 red blends for whatever reason did not sell, would not be salable to a distributor or broker and
20 would have to be sold directly to consumers at the AJW tasting room. As evident by the
21 substantial unsold quantity of these wines, they have not been selling at a pace that would result
22 in timely depletion rates and will only lose value with age. A fair market retail price for these
23 wines would be in the $32.00 per bottle range for a total collective retail value of $338,115. This
24 would reduce AJW’s total retail value $7,629,060 down by another $1,300,000.
25 10. A similar analysis can be applied to each SKU of the AJW cased goods with
26 vintages older than 2018 (which is a significant majority of its overall inventory). In my opinion,
27 each such SKU is overvalued between 50% to 75%, with many being unsalable and candidates
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CARLE, MACKIE, 3
POWER & ROSS LLP
DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY
INJUNCTION AND APPOINTMENT OF RECEIVER
1 for destruction.
2 11. In my opinion, based on AJW’s 12/31/23 inventory list attached hereto as Exhibit
3 B, the total retail value stated by AJW in the amount of $7,629,060 for the cased goods is grossly
4 overestimated and misleading. In a best-case scenario, over a sales period of several years it
5 could achieve direct to consumer retail sales in the area of $1,200,000. If sold through
6 discounted wholesale channels, its liquidation value is between $200,000 to $300,000.
7 12. The retail and wholesale values placed on the bulk wines by AJW ($10,310,732
8 and $5,155,366) are similarly grossly overestimated and highly misleading. Exhibit C. A
9 majority of the bulk wines are older varietals still stored in steel tanks that can only be used for
10 blending, however they are assigned wholly unrealistic retail values that add up to over a million
11 dollars. For example, there are nearly 8500 gallons of 2016 and 2017 red wines stored in steel
12 tanks that are collectively given retail values over $3,000,000. I am unaware of any reason why
13 these bulk wines were not transferred to oak barrels or have not been bottled and are sitting in
14 steel tanks. This is usually a sign that the winery may have overpurchased grapes or bulk wine
15 and did not have the sales demand to bottle them. These red wines in steel tanks at this point in
16 their life cycle will never be bottled and sold at retail as the bottling and packaging costs alone
17 would be cost prohibitive and no distributor or broker would even consider purchasing them. At
18 best, they may be used for blending and/or liquidated on the bulk market for just a few dollars
19 per gallon. More likely, much of it will need to be eventually destroyed as the costs of continued
20 years of storage will become cost prohibitive. My conclusion as to the value of the bulk wines is
21 $334,864, with most of that value being in the unbottled newer red wine vintages, and is set forth
22 in my report in Exhibit D.
23 13. I have been provided with a copy of AJW’s sales from January 1, 2024, through
24 March 20, 2024, which Plaintiff’s counsel has informed me was provided by AJW. It shows
25 sales of 3,223 bottles or an equivalent of 269 cases. Based on the inventory lists AJW provided,
26 this extrapolates to an annual sales volume of approximately 1,074 cases. At this rate, AJW has
27 approximately 9 years of finished goods inventory on hand. Notably, this calculation does not
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CARLE, MACKIE, 4
POWER & ROSS LLP
DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY
INJUNCTION AND APPOINTMENT OF RECEIVER
1 include unbottled bulk inventory gallons and if added would exceed 15 years of inventory.
2 Typically, a 4 or 5-year stock of finished goods and bulk inventory is acceptable for a small
3 winery.
4 14. I was provided the AJW 2023 and 2024 (through March 22) Profit and Loss
5 Statements (“P&L”) and Balance Sheet by Plaintiffs’ counsel, Daniel Reidy. Attached hereto as
6 Exhibit F are true and correct copies of these financial documents.
7 15. In the first 10 weeks of 2024, total income was $292,608, with $214,252 of that
8 attributed to wine sales. Net loss for the period was $252,204, and that is prior to the recording
9 of larger expenses such as rent, property tax, and interest. Cost of goods are inconsistent month-
10 to-month and year-to-year. One can extrapolate that 2024 total income may be $1,170,000, with
11 a corresponding net loss of $1,500,000.
12 16. There are a number of suspect line items, including:
13 $669,666 in "property purchase related expenses.” The company does
14 not own property as an asset and this significant expenditure raises
15 questions.
16 It is unclear where common production expenses are being recorded as
17 they do not appear to be recognized in the P&L.
18 Salaries appear to be highly inconsistent from 2023 ($585,351.62) to
19 2024. Salaries in the first two months of 2024 appear to be extremely
20 low, as they are trending to $120k for 2024.
21 17. In reviewing the Balance Sheets, it is notable that the value of the bulk wine in
22 process remained flat. One would expect this value to change over time as winemaking activities
23 occur and bulk wines are transformed into salable cased goods. This is not a good sign for a
24 winery and indicative of financial instability.
25 18. Total liabilities are $9,271,080, while the asset base is $2,883,818. If all assets
26 were sold at the value reflected on the balance sheet, it would only satisfy 30% of the current
27 liabilities. This statement assumes that finished goods and bulk wine can be sold at the value
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CARLE, MACKIE, 5
POWER & ROSS LLP
DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY
INJUNCTION AND APPOINTMENT OF RECEIVER
1 reflected on the balance sheet, which is grossly inflated.
2 19. Retained earnings are increasingly negative with each quarterly loss, meaning
3 total equity continues to decline.
4 20. I was informed by Plaintiffs’ counsel, Daniel Reidy, that AJW is in default on
5 nearly $7,000,000 in loans from the Plaintiffs and over $400,000 in arrears in rent. There are
6 also a number of unpaid/deferred salaries noted on the Balance Sheet.
7 21. Based on my careful review of the documents attached herein, it is my conclusion
8 that the business is unsustainable and incapable of being profitable absent an immediate and
9 significant cash infusion in the area of $10M to $12M. This would allow the company to satisfy
10 existing debt, dispose of unsalable inventory and effectively begin anew. There is no significant
11 brand equity to associate with AJW, and given that it does not own the winery or any vineyard
12 assets and can only offer highly overvalued and fully pledged wine inventory while operating at
13 a significant and consistent monthly and annual loss, no institutional or private equity lender
14 would consider a loan or investment even remotely in this range. There is no leverage that AJW
15 can offer a lender to secure the funding required to stabilize this business.
16 22. I was informed that Matt Ospeck stated the value of the wine inventory to this
17 Court during the prior TRO hearing at $13.9M. Based on my expertise in wine inventory
18 valuations, it is my opinion that this value is false and grossly misleading. It assumes that many
19 thousands of gallons of bulk wine, and a few thousand cased goods can be sold at retail or
20 wholesale prices that are simply unrealistic. This is not possible as a significant majority of both
21 the cased goods and bulk wine inventory will need to be sold at near liquidation prices for
22 distribution through discount sales channels, or even destroyed. In a best-case scenario, the
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CARLE, MACKIE, 6
POWER & ROSS LLP
DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY
INJUNCTION AND APPOINTMENT OF RECEIVER
th
1 value of the wine inventory is about 1/10 of the value that Defendants have claimed to the court
2 and the inventory reports that I have carefully examined and considered.
3 I declare under penalty of perjury under the laws of the State of California that foregoing
th
4 is true and correct. Dated this 11 day of April, 2024, at Fort Collins, Colorado.
5
/s/ Courtney Prose
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Courtney Prose
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CARLE, MACKIE, 7
POWER & ROSS LLP
DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY
INJUNCTION AND APPOINTMENT OF RECEIVER
EXHIBITA
EXHIBIT A
COURTNEY PROSE 🕽 707.738.4370 🖂 courtneyprose@gmail.com www.linkedin.com/in/courtney-prose
Influences Strategy | Collaborative | Inspires High Performing Teams
Finance | Sales & Operations Planning | Supply Chain
EXPERIENCE
CP Consulting - (2023)
• Lending expertise to wine companies in S+OP, FP&A, budgeting, costing methodology, inventory
management, process flow.
Vintage Wine Estates (VWE) - Santa Rosa, CA (2022)
VICE PRESIDENT SUPPLY CHAIN
• Lead Demand Planning, Logistics, Procurement and Warehousing teams to ensure consistent and predictable
supply chain.
Francis Ford Coppola Presents (FFCP) — Geyserville, CA (2011 – 2021)
VICE PRESIDENT OF PRODUCTION (2018 – 2021)
• Elevated the execution of sales and operations planning (S+OP) within the organization and with external
supply chain partners. Leveraged, elevated, and expanded prior role span of control.
• Led a diverse winemaking, grower relations, sustainability, safety, and warehouse/distribution team.
• Drove robust demand and production planning processes that optimize the needs of both sales and
operations. Spearheaded continuous improvement in forecast simulations to help the organization reach
strategic and tactical operations and sales goals.
• Key advisor during the company’s strategic multi-year project involving the JDE enterprise resource planning
(ERP) system project implementation. Worked with outside integration consulting teams to provide insight and
company requirements for multi-site production operations, finance, and distribution.
• Balanced production capacity for FFCP and private label business (~25% of production volume) based on
capacity constraints, revenue upside, offsite contract availability, and seasonal impacts.
• Reduced surplus inventory by 38% over six months. Partnered with finance leadership and engaged with
external brokers to establish pricing and purchasing guidelines. Realized an additional $700K in storage and
transportation savings (~8%).
• Secured long-term contract business to leverage internal capacities and drive resource utilization. Negotiated
and set contract terms and evaluated regulatory compliance.
VICE PRESIDENT OF FINANCE & OPERATIONS (2011 – 2018)
• Oversight of costing,trade spend reporting and regulatory compliance.
• Developed custom label business that accounted for ~10% of revenue and $24million in year three top-line
revenue. Engaged in key accounts and buyer meetings to designing programs, developing contract terms,
and instituting direct sales activity.
• Led demand planning, compliance, and 3rd party warehouse teams in strategic inventory management for
grape and bulk wine. Forecasted and planned for consistent stock availability of 250+ SKUs.
• Managed cost of goods budgeting and methodology. Improved costing methodology and simplified cost
categorization to streamline the planning process, leading to more accurate forecasting.
• Implemented brand profitability models to analyze contribution by brand and by SKU. Developed an initial tool
for leadership to enhance understanding of profit leaders across brands and customers.
• Managed the capital expenditure process for highly varied company operations. Partnered with operations
and direct-to-consumer (DTC) teams to provide project analytical support.
• Collaborated with the executive team to manage the budget process. Led teams in common net revenue and
contribution goal planning. Partner with sales on short- and long-range volume planning.
Ascentia Wine Estates — Healdsburg, CA (2008 – 2011)
VICE PRESIDENT OF FINANCE & OPERATIONS
• Led demand planning, warehouse, compliance, and customer service teams in inventory management.
• Managed costing, central finance, and winery finance teams to achieve common objectives and oversaw
COGs methodology and implementation.
Beam Wine Estates — Healdsburg, CA (2001 – 2008)
DIRECTOR, OPERATION FINANCE (2008) | DIRECTOR, SUPPLY CHAIN (2007-2008)
SUPPLY CHAIN MANAGER (2005-2007 | MANAGEMENT ACCOUNTANT (2001 - 2005)
• Spanned multiple departments bringing analytical rigor and objective decision-making to supply chain
operations, demand planning, costing, warehouse operations, and customer service.
• Managed the company’s primary inventory planning model before, during, and after consolidations and
acquisitions of Allied Domecq Wines and Beam Wine Estates.
• Charged with driving long-term strategic inventory management approaches and execution of product and
financial planning models that aligned with corporate P&L objectives.
• Responsible for managing $160million in COGs, covering 10 brands.
Geyser Peak Winery, Geyserville, CA | Senior Accountant (2000 – 2001)
Textainer Equipment Management, San Francisco, CA | Senior Accountant (1995 – 2000)
EDUCATION
University of San Francisco, San Francisco, CA
• Bachelor of Science (BS) in Accounting | Worked all four years in the admissions office recruiting, creating
programming that engaged prospective students.
Certified Management Accountant Program — Financial Planning, Performance and Control
Technical Skills Familiarity: Microsoft Office Suite (Excel, PowerPoint, Teams, Word), Adobe Acrobat/PDF, JDE, SAP
Page 2 of 2
EXHIBITB
EXHIBIT
Bottled Wine <16% Alc 31-Dec-23 Ret $/btl Retail Tot FOB Tot ASP Tot
750 Pallets 750 Cases 750x6, 375x12 Mag Cases Total Cases Bottles Mags Litres Gallons 1.00 0.5 0.83
08 AS Meritage 15 15.0 0.0 90.0 135 35.7 $100.00 $ 18,000 $ 9,000 $ 14,940
08 Blk 1 CS 12 12.0 144.0 108 28.5 $150.00 $ 21,600 $ 10,800 $ 17,928
08 Blk 4 CS 5 34 39.0 60.0 204.0 351 92.7 $150.00 $ 70,200 $ 35,100 $ 58,266
09 AS Meritage 6 6.0 36.0 54 14.3 $100.00 $ 7,200 $ 3,600 $ 5,976
09 Blk 2 23 23.0 138.0 207 54.7 $150.00 $ 41,400 $ 20,700 $ 34,362
09 Blk 1/4 17 18 35.0 204.0 108.0 315 83.2 $150.00 $ 63,000 $ 31,500 $ 52,290
10 AS Meritage Left 15 15.0 90.0 135 35.7 $125.00 $ 22,500 $ 11,250 $ 18,675
10 AS Meritage Center 9 9.0 54.0 81 21.4 $125.00 $ 13,500 $ 6,750 $ 11,205
10 AS Meritage Right 3 3.0 18.0 27 7.1 $125.00 $ 4,500 $ 2,250 $ 3,735
11 Meritage 25 25.0 300.0 225 59.4 $100.00 $ 30,000 $ 15,000 $ 24,900
11 AS Meritage 20 20.0 0.0 120.0 180 47.6 $125.00 $ 30,000 $ 15,000 $ 24,900
11 RR CS 47 47.0 564.0 423 111.7 $110.00 $ 62,040 $ 31,020 $ 51,493
12 PHAETON 22 22.0 0.0 132.0 198 52.3 $60.00 $ 15,840 $ 7,920 $ 13,147
12 AS 15 15.0 90.0 135 35.7 $125.00 $ 22,500 $ 11,250 $ 18,675
12 NV CS 22 22.0 132.0 198 52.3 $150.00 $ 39,600 $ 19,800 $ 32,868
14 1001 Prop Red 10 12 432.0 5,184.0 3,888 1,027.1 $80.00 $ 414,720 $ 207,360 $ 344,218
15 1001 Prop Red 19 798.0 9,576.0 7,182 1,897.3 $80.00 $ 766,080 $ 383,040 $ 635,846
15 Speedster 16 36 708.0 8,496.0 6,372 1,683.3 $60.00 $ 509,760 $ 254,880 $ 423,101
15 PHAETON 3 8 134.0 1,608.0 1,206 318.6 $60.00 $ 96,480 $ 48,240 $ 80,078
16 PHAETON 7 34 328.0 3,936.0 2,952 779.8 $60.00 $ 236,160 $ 118,080 $ 196,013
16 Speedster 3 32 158.0 1,896.0 1,422 375.6 $60.00 $ 113,760 $ 56,880 $ 94,421
16 1001 Prop Red 2 32 116.0 1,392.0 1,044 275.8 $80.00 $ 111,360 $ 55,680 $ 92,429
16 1001 Coombsville Cab 1 46 88.0 1,056.0 792 209.2 $135.00 $ 142,560 $ 71,280 $ 118,325
16 1001 Rutherford Cab 2 66 150.0 1,800.0 1,350 356.6 $135.00 $ 243,000 $ 121,500 $ 201,690
16 Clarksburg Malbec 2 52 136.0 1,632.0 1,224 323.3 $50.00 $ 81,600 $ 40,800 $ 67,728
16 CA Cab 3 24 150.0 1,800.0 1,350 356.6 $46.00 $ 82,800 $ 41,400 $ 68,724
16 NC Cab Franc 38 38.0 456.0 342 90.3 $56.00 $ 25,536 $ 12,768 $ 21,195
17 AS 40 40.0 480.0 360 95.1 $80.00 $ 38,400 $ 19,200 $ 31,872
17 1001 Rutherford Cab 5 28 308.0 3,696.0 2,772 732.3 $135.00 $ 498,960 $ 249,480 $ 414,137
17 1001 Rutherford Cab 2 4 45 269.0 3,228.0 2,421 639.6 $135.00 $ 435,780 $ 217,890 $ 361,697
18 1001 Rutherford Cab 4 17 241.0 2,892.0 2,169 573.0 $135.00 $ 390,420 $ 195,210 $ 324,049
18 1001 Prop Red 9 35 539.0 6,468.0 4,851 1,281.5 $80.00 $ 517,440 $ 258,720 $ 429,475
18 Artist Series 1 35 91.0 1,092.0 819 216.4 $80.00 $ 87,360 $ 43,680 $ 72,509
19 Artist Series 2 26 138.0 1,656.0 1,242 328.1 $80.00 $ 132,480 $ 66,240 $ 109,958
19 1001 Rutherford Cab 5 31 311.0 3,732.0 2,799 739.4 $135.00 $ 503,820 $ 251,910 $ 418,171
19 1001 Prop Red 3 24 192.0 2,304.0 1,728 456.5 $80.00 $ 184,320 $ 92,160 $ 152,986
19 Estate 53 53.0 636.0 477 126.0 $160.00 $ 101,760 $ 50,880 $ 84,461
19 AJ Res Chard 1 10 66.0 792.0 594 156.9 $42.00 $ 33,264 $ 16,632 $ 27,609
20 AJ Res Chard 9 14 518.0 6,216.0 4,662 1,231.6 $38.00 $ 236,208 $ 118,104 $ 196,053
20 Rose 61 67 3,483.0 41,796.0 31,347 8,280.9 $32.00 $ 1,337,472 $ 668,736 $ 1,110,102
9,793.0 115,092.0 88,137.0 23,283.2 $ 7,783,380 $ 3,891,690 $ 6,460,205
Bulk $ 10,310,732 $ 5,155,366 $ 8,557,907
Combined $ 18,094,112 $ 9,047,056 $ 15,018,113
EXHIBITC
EXHIBIT C
Bulk Wines < 16% Alc 31-Dec-23 Component of $/btl Ret Retail Value 50% FOB ASP at $45/gal
# of Litres Gallons $ 1.00 $ 0.50 $ 0.83 $ 45.00
16 Cabernet Sauvignon Barrel 4 893.4 236.0 CA Cab $ 46.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 893.4 236.0 $ 54,736 $ 27,368 $ 45,431 $ 10,620
16 Cabernet Sauvignon Barrel 0.0 0.0 CA Cab $ 46.00
Heringer + Welch Merlot Puncheon 0.0 0.0
Includes 50% count of SV Cab Steel 15100.0 3989.0
Tank 8 Total Bulk 15100.0 3989.0 $ 925,172 $ 462,586 $ 767,893 $ 179,504
17 Cabernet Sauvignon Barrel 4 893.4 236.0 Napa Cab $ 135.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 893.4 236.0 $ 160,639 $ 80,319 $ 133,330 $ 10,620
17 Cab Franc Barrel 0.0 0.0 AS/1001/Napa Cab $ 100.00
Babcock Puncheon 0.0 0.0
Tank 63 Steel 3850.0 1017.1
Total Bulk 3850.0 1017.1 $ 512,801 $ 256,400 $ 425,624 $ 45,767
17 Petit Verdot Barrel 0.0 0.0 Ruth and AS $ 106.00
DBIC Puncheon 0.0 0.0
Steel 1825.0 482.1
Total Bulk 1825.0 482.1 $ 257,666 $ 128,833 $ 213,862 $ 21,695
17 Cabernet Sauvignon Barrel 0.0 0.0 Ruth Cab $ 135.00
Round Pond Puncheons 0.0 0.0
Per 17 Blending Steel 3200.0 845.3
Tank 1 Total Bulk 3200.0 845.3 $ 575,402 $ 287,701 $ 477,584 $ 38,040
17 Malbec Barrel 10 2250.0 594.4 AS / Ruth Cab/1001 $ 106.00
DBIC Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 2250.0 594.4 $ 317,670 $ 158,835 $ 263,666 $ 26,747
17 Merlot Barrel 0.0 0.0 1001/AS/Phaeton $ 80.00
La Cereces Puncheon 0.0 0.0
Tank 61 Steel 3500.0 924.6
+ 3 barrels 17RPCS Total Bulk 3500.0 924.6 $ 372,946 $ 186,473 $ 309,545 $ 41,607
17 Malbec Barrel 0.0 0.0 Malbec $ 50.00
Heringer Puncheon 0.0 0.0
Tank 12 Steel 7600.0 2007.7
Total Bulk 7600.0 2007.7 $ 506,141 $ 253,070 $ 420,097 $ 90,346
18 AJ Heringer Tannat Barrel 10 2233.4 590.0 Malbec $ 50.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 2233.4 590.0 $ 148,739 $ 74,370 $ 123,454 $ 26,550
18 AJ Heringer CS Barrel 0.0 0.0 CA Cab $ 46.00
Tank 6&11 Puncheon 0.0 0.0
Steel 12158.8 3212.0
Total Bulk 12158.8 3212.0 $ 744,968 $ 372,484 $ 618,323 $ 144,540
18 AJ Heringer Malbec Barrel 0.0 0.0 CA Cab/ Malbec $ 48.00
Tank 5 Puncheon 0.0 0.0
Steel 5488.9 1450.0
Total Bulk 5488.9 1450.0 $ 350,924 $ 175,462 $ 291,267 $ 65,250
19 AJ DBIC Malbec Barrel 2 446.7 118.0 Napa Cabs/AS $ 106.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 446.7 118.0 $ 63,066 $ 31,533 $ 52,344 $ 5,310
19 AJ DBIC Merlot Barrel 1 223.3 59.0 AS/Napa Cabs $ 106.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 223.3 59.0 $ 31,533 $ 15,766 $ 26,172 $ 2,655
19 AJ DBIC PV Barrel 8 1786.7 472.0 Napa Cabs/AS/1001 $ 100.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 1786.7 472.0 $ 237,983 $ 118,992 $ 197,526 $ 21,240
20 Dry Creek CF Barrel 11 2456.8 649.0 CA Cab/1001/Franc $ 80.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 2456.8 649.0 $ 261,782 $ 130,891 $ 217,279 $ 29,205
20 Dry Creek Malbec Barrel 11 2456.8 649.0 Ca Cab/1001/AS $ 70.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 2456.8 649.0 $ 229,059 $ 114,529 $ 190,119 $ 29,205
21 DBIC Malbec Barrel 3 670.0 177.0 Napa Cab/Ruth/AS/1001 $ 106.00
Puncheon 2 984.2 260.0
Steel 0.0 0.0
Total Bulk 1654.2 437.0 $ 233,556 $ 116,778 $ 193,852 $ 19,665
21 DBIC Merlot Barrel 19 4243.5 1121.0 Napa Cab/Ruth/AS/1001 $ 100.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 4243.5 1121.0 $ 565,210 $ 282,605 $ 469,124 $ 50,445
21 DBIC PV Barrel 7 1563.4 413.0 Napa Cab/Ruth/AS/1001 $ 100.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 1563.4 413.0 $ 208,235 $ 104,118 $ 172,835 $ 18,585
21 Estate Cab S Barrel 1 223.3 59.0 Estate Cab $ 160.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 223.3 59.0 $ 47,597 $ 23,798 $ 39,505 $ 2,655
21 RP Cab S Barrel 10 2233.4 590.0 Ruth Cab $ 135.00
Puncheon 3 1476.3 390.0
Steel 0.0 0.0
Total Bulk 3709.7 980.0 $ 667,059 $ 333,529 $ 553,659 $ 44,100
22 AJW DBIC OK Malbec Barrel 10 2233.4 590.0 Napa Cab/AS/1001 $ 106.00
Puncheon 4 1968.4 520.0
Steel 0.0 0.0
Total Bulk 4201.8 1110.0 $ 593,244 $ 296,622 $ 492,392 $ 49,950
22 AJW Weiss AP Cab S Barrel 10 2233.4 590.0 Napa Cab $ 135.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 2233.4 590.0 $ 160,639 $ 80,319 $ 133,330 $ 26,550
22 AJW Hills RF Cab S Barrel 8 1786.7 472.0 Ruth Cab $ 135.00
Puncheon 4 1968.4 520.0
Steel 0.0 0.0
Total Bulk 3755.2 992.0 $ 675,227 $ 337,613 $ 560,438 $ 44,640
22 AJW Estate Cab S Barrel 3 670.0 177.0 Estate Cab $ 160.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 670.0 177.0 $ 142,790 $ 71,395 $ 118,516 $ 7,965
23 AJW Weiss AP Cab S Barrel 15 3325.1 878.4 Napa Cab $ 135.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 3325.1 878.4 $ 597,903 $ 298,951 $ 496,259 $ 39,528
23 AJW Hills RF Cab S Barrel 14 3185.8 841.6 Ruth Cab $ 135.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 3185.8 841.6 $ 572,854 $ 286,427 $ 475,469 $ 37,872
23 AJW Estate Cab S Barrel 2 446.7 118.0 Estate Cab $ 160.00
Puncheon 0.0 0.0
Steel 0.0 0.0
Total Bulk 446.7 118.0 $ 95,193 $ 47,597 $ 79,010 $ 5,310
Total Gallons 25,248 gallons $ 10,310,732 $ 5,155,366 $ 8,557,907 $ 1,136,167
10,608 Cases Retail Value 50% FOB ASP Firesale bulk
DG Cost/Case 30
Cost to bottle 319,103
EXHIBITD
EXHIBIT
Bulk Wine 12/31/2023
Value per Value on
Wine Description Vintage Appellation Gallons Gallon bulk market Comments
2016 Cabernet 2016 CA 236 $ 2.00 $ 472 2016 may not h
Preview
1 Philip J. Terry (SBN 148144) Justin D. Hein (SBN 249275) 2 CARLE, MACKIE, POWER & ROSS LLP 100 B Street, Suite 400 3 Santa Rosa, California 95401 Telephone: (707) 526-4200 4 Facsimile: (707) 526-4707 pjterry@cmprlaw.com 5 jhein@cmprlaw.com 6 Daniel A. Reidy (SBN 139321) REIDY LAW GROUP LLP 7 1230 Spring Street St. Helena, CA 94574 8 Telephone: (707) 963-3030 dan@reidylawgroup.com 9 10 Attorneys for Plaintiffs 3840 STONEBRIDGE, LLC, an Ohio Limited Liability Company 11 and M. DAVID JESTER, an Individual 12 SUPERIOR COURT OF THE STATE OF CALIFORNIA 13 COUNTY OF NAPA 14 3840 STONEBRIDGE, LLC, an Ohio Limited Case No: 24CV000226 Liability Company, and M. DAVID JESTER, 15 an individual, DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ 16 Plaintiffs, MOTION FOR PRELIMINARY INJUNCTION AND APPOINTMENT OF 17 v. RECEIVER 18 AUBURNJAMES WINERY, LLC, a Delaware Date: May 8, 2024 Limited Liability Company, and MATT Time: 8:30 a.m. 19 OSPECK, an individual, DOES 1-100, Dept.: A inclusive, 20 Defendants. Complaint filed: February 15, 2024 21 Trial Date: None 22 Judge: Hon. Cynthia P. Smith Dept. A 23 24 I, Courtney Prose, declare: 25 1. I have personal knowledge of the following facts and am competent to testify as 26 to the truth of those facts if called as a witness. 27 2. I have worked exclusively in the wine industry for nearly 24 years in senior and 28 executive roles at major wineries at which I was responsible for leading all aspects of wine CARLE, MACKIE, 1 POWER & ROSS LLP DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY INJUNCTION AND APPOINTMENT OF RECEIVER 1 inventory and supply chain management, and cost of goods. I have developed and led initiatives 2 to exit surplus inventory of both case goods and bulk wines. This work included conducting 3 wine inventory appraisals, working with audit partners, and partnering with accounts to create 4 exit plans for wines and destruction of non-salable wines. I am currently the principal of CP 5 Wine Consulting which is primarily engaged in the business of conducting wine inventory 6 evaluation and appraisal, exit plans, and related services. I have a BA degree in Accounting 7 from the University of San Francisco. My C.V. is attached hereto as Exhibit A. 8 3. In this case, I was hired by Plaintiffs to review and provide an opinion as to the 9 value of the bulk wine and finished goods (cased goods) inventory belonging to AuburnJames 10 Winery, LLC (“AJW”), and to review certain financial reports and render my opinion as to the 11 condition and sustainability of AJW. 12 4. On or about January 22, 2024, I was provided with a finished (cased) goods 13 inventory list with pricing dated “12/31/23.” I received this list in an email from Plaintiffs’ 14 counsel, Daniel Reidy, who informed me that the list and pricing had been provided to Mr. Reidy 15 by AJW. A true and correct copy of that document is attached hereto as Exhibit B. 16 5. On or about January 26, 2024, I was provided with a bulk wines inventory list 17 with pricing for wines stored in tanks and barrels. I received this list from Plaintiffs’ counsel, 18 Daniel Reidy, who informed me that the list and pricing had been provided to Mr. Reidy by 19 AJW. A true and correct copy of that document is attached hereto as Exhibit C. 20 6. On February 12, 2024, I physically inspected AJW’s inventory at AJW’s winery 21 located at 1001 Silverado Trail South, Saint Helena, CA 94574. Matt Ospeck, who was 22 identified as the owner of AJW, was present at the inspection. 23 7. Based on my careful review of the bulk wine and finished goods inventory and 24 pricing lists, my visual inspection of actual goods stored at AJW, and additional research to 25 determine market values, which among other things included reading reviews of AJW wines by 26 wine critics, and other pertinent marketplace information, I prepared two reports: one for bulk 27 wines and the other for cased goods inventory. In so doing, I took AJW’s reports and then added 28 CARLE, MACKIE, 2 POWER & ROSS LLP DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY INJUNCTION AND APPOINTMENT OF RECEIVER 1 additional columns showing current fair market values for each vintage, varietal, and blend that 2 AJW had listed. True and correct copies of my reports are attached hereto as Exhibits D and E. 3 8. My conclusions, and as reflected in my reports, are that the prices set forth in 4 AJW’s inventory and pricing lists are grossly inaccurate and overestimated. In the finished 5 goods report in Exhibit B, AJW shows a “Total Retail Value” of $7,629,060. To get to this 6 figure, AJW assigns retail prices for older vintages (that for whatever reason did not sell) that are 7 wholly unrealistic. For example, the final item in the report is for “20 Rosé” and shows 3,483 8 cases (41,796 bottles) at a retail price of $32.00 per bottle for a total retail value of $1,337,472. 9 Current Rosé vintages in the marketplace are 2022 with 2023 being bottled and released this 10 Spring. A 2020 Rosé is not salable at $32.00 per bottle, and no distributor or broker would 11 consider taking this wine, even if discounted to less than a few dollars per bottle. Thus, in my 12 opinion, this one-line item alone reduces the $7,629,060 retail value claimed by AJW by nearly 13 $1,300,000. It is also notable that the 2020 Rosé is not offered for sale on the AJW website, 14 which in my opinion indicates that it knows this wine is unsalable and may perhaps be looking to 15 liquidate the inventory as a whole, which in a best-case scenario may fetch $2 to $5 per bottle. 16 9. Further examples of gross inaccuracies and overestimations are the line items for 17 “14 1001 Prop Red”, “15 1001 Prop Red” and “15 Speedster,” which account for 1,938 cases 18 and collectively claim a retail value of $1,690,560 ($80.00 per bottle). These nearly 10-year-old 19 red blends for whatever reason did not sell, would not be salable to a distributor or broker and 20 would have to be sold directly to consumers at the AJW tasting room. As evident by the 21 substantial unsold quantity of these wines, they have not been selling at a pace that would result 22 in timely depletion rates and will only lose value with age. A fair market retail price for these 23 wines would be in the $32.00 per bottle range for a total collective retail value of $338,115. This 24 would reduce AJW’s total retail value $7,629,060 down by another $1,300,000. 25 10. A similar analysis can be applied to each SKU of the AJW cased goods with 26 vintages older than 2018 (which is a significant majority of its overall inventory). In my opinion, 27 each such SKU is overvalued between 50% to 75%, with many being unsalable and candidates 28 CARLE, MACKIE, 3 POWER & ROSS LLP DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY INJUNCTION AND APPOINTMENT OF RECEIVER 1 for destruction. 2 11. In my opinion, based on AJW’s 12/31/23 inventory list attached hereto as Exhibit 3 B, the total retail value stated by AJW in the amount of $7,629,060 for the cased goods is grossly 4 overestimated and misleading. In a best-case scenario, over a sales period of several years it 5 could achieve direct to consumer retail sales in the area of $1,200,000. If sold through 6 discounted wholesale channels, its liquidation value is between $200,000 to $300,000. 7 12. The retail and wholesale values placed on the bulk wines by AJW ($10,310,732 8 and $5,155,366) are similarly grossly overestimated and highly misleading. Exhibit C. A 9 majority of the bulk wines are older varietals still stored in steel tanks that can only be used for 10 blending, however they are assigned wholly unrealistic retail values that add up to over a million 11 dollars. For example, there are nearly 8500 gallons of 2016 and 2017 red wines stored in steel 12 tanks that are collectively given retail values over $3,000,000. I am unaware of any reason why 13 these bulk wines were not transferred to oak barrels or have not been bottled and are sitting in 14 steel tanks. This is usually a sign that the winery may have overpurchased grapes or bulk wine 15 and did not have the sales demand to bottle them. These red wines in steel tanks at this point in 16 their life cycle will never be bottled and sold at retail as the bottling and packaging costs alone 17 would be cost prohibitive and no distributor or broker would even consider purchasing them. At 18 best, they may be used for blending and/or liquidated on the bulk market for just a few dollars 19 per gallon. More likely, much of it will need to be eventually destroyed as the costs of continued 20 years of storage will become cost prohibitive. My conclusion as to the value of the bulk wines is 21 $334,864, with most of that value being in the unbottled newer red wine vintages, and is set forth 22 in my report in Exhibit D. 23 13. I have been provided with a copy of AJW’s sales from January 1, 2024, through 24 March 20, 2024, which Plaintiff’s counsel has informed me was provided by AJW. It shows 25 sales of 3,223 bottles or an equivalent of 269 cases. Based on the inventory lists AJW provided, 26 this extrapolates to an annual sales volume of approximately 1,074 cases. At this rate, AJW has 27 approximately 9 years of finished goods inventory on hand. Notably, this calculation does not 28 CARLE, MACKIE, 4 POWER & ROSS LLP DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY INJUNCTION AND APPOINTMENT OF RECEIVER 1 include unbottled bulk inventory gallons and if added would exceed 15 years of inventory. 2 Typically, a 4 or 5-year stock of finished goods and bulk inventory is acceptable for a small 3 winery. 4 14. I was provided the AJW 2023 and 2024 (through March 22) Profit and Loss 5 Statements (“P&L”) and Balance Sheet by Plaintiffs’ counsel, Daniel Reidy. Attached hereto as 6 Exhibit F are true and correct copies of these financial documents. 7 15. In the first 10 weeks of 2024, total income was $292,608, with $214,252 of that 8 attributed to wine sales. Net loss for the period was $252,204, and that is prior to the recording 9 of larger expenses such as rent, property tax, and interest. Cost of goods are inconsistent month- 10 to-month and year-to-year. One can extrapolate that 2024 total income may be $1,170,000, with 11 a corresponding net loss of $1,500,000. 12 16. There are a number of suspect line items, including: 13 $669,666 in "property purchase related expenses.” The company does 14 not own property as an asset and this significant expenditure raises 15 questions. 16 It is unclear where common production expenses are being recorded as 17 they do not appear to be recognized in the P&L. 18 Salaries appear to be highly inconsistent from 2023 ($585,351.62) to 19 2024. Salaries in the first two months of 2024 appear to be extremely 20 low, as they are trending to $120k for 2024. 21 17. In reviewing the Balance Sheets, it is notable that the value of the bulk wine in 22 process remained flat. One would expect this value to change over time as winemaking activities 23 occur and bulk wines are transformed into salable cased goods. This is not a good sign for a 24 winery and indicative of financial instability. 25 18. Total liabilities are $9,271,080, while the asset base is $2,883,818. If all assets 26 were sold at the value reflected on the balance sheet, it would only satisfy 30% of the current 27 liabilities. This statement assumes that finished goods and bulk wine can be sold at the value 28 CARLE, MACKIE, 5 POWER & ROSS LLP DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY INJUNCTION AND APPOINTMENT OF RECEIVER 1 reflected on the balance sheet, which is grossly inflated. 2 19. Retained earnings are increasingly negative with each quarterly loss, meaning 3 total equity continues to decline. 4 20. I was informed by Plaintiffs’ counsel, Daniel Reidy, that AJW is in default on 5 nearly $7,000,000 in loans from the Plaintiffs and over $400,000 in arrears in rent. There are 6 also a number of unpaid/deferred salaries noted on the Balance Sheet. 7 21. Based on my careful review of the documents attached herein, it is my conclusion 8 that the business is unsustainable and incapable of being profitable absent an immediate and 9 significant cash infusion in the area of $10M to $12M. This would allow the company to satisfy 10 existing debt, dispose of unsalable inventory and effectively begin anew. There is no significant 11 brand equity to associate with AJW, and given that it does not own the winery or any vineyard 12 assets and can only offer highly overvalued and fully pledged wine inventory while operating at 13 a significant and consistent monthly and annual loss, no institutional or private equity lender 14 would consider a loan or investment even remotely in this range. There is no leverage that AJW 15 can offer a lender to secure the funding required to stabilize this business. 16 22. I was informed that Matt Ospeck stated the value of the wine inventory to this 17 Court during the prior TRO hearing at $13.9M. Based on my expertise in wine inventory 18 valuations, it is my opinion that this value is false and grossly misleading. It assumes that many 19 thousands of gallons of bulk wine, and a few thousand cased goods can be sold at retail or 20 wholesale prices that are simply unrealistic. This is not possible as a significant majority of both 21 the cased goods and bulk wine inventory will need to be sold at near liquidation prices for 22 distribution through discount sales channels, or even destroyed. In a best-case scenario, the 23 /// 24 /// 25 /// 26 27 28 CARLE, MACKIE, 6 POWER & ROSS LLP DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY INJUNCTION AND APPOINTMENT OF RECEIVER th 1 value of the wine inventory is about 1/10 of the value that Defendants have claimed to the court 2 and the inventory reports that I have carefully examined and considered. 3 I declare under penalty of perjury under the laws of the State of California that foregoing th 4 is true and correct. Dated this 11 day of April, 2024, at Fort Collins, Colorado. 5 /s/ Courtney Prose 6 Courtney Prose 7 8 9 10 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28 CARLE, MACKIE, 7 POWER & ROSS LLP DECLARATION OF COURTNEY PROSE IN SUPPORT OF PLAINTIFFS’ MOTION FOR PRELIMINARY INJUNCTION AND APPOINTMENT OF RECEIVER EXHIBITA EXHIBIT A COURTNEY PROSE 🕽 707.738.4370 🖂 courtneyprose@gmail.com www.linkedin.com/in/courtney-prose Influences Strategy | Collaborative | Inspires High Performing Teams Finance | Sales & Operations Planning | Supply Chain EXPERIENCE CP Consulting - (2023) • Lending expertise to wine companies in S+OP, FP&A, budgeting, costing methodology, inventory management, process flow. Vintage Wine Estates (VWE) - Santa Rosa, CA (2022) VICE PRESIDENT SUPPLY CHAIN • Lead Demand Planning, Logistics, Procurement and Warehousing teams to ensure consistent and predictable supply chain. Francis Ford Coppola Presents (FFCP) — Geyserville, CA (2011 – 2021) VICE PRESIDENT OF PRODUCTION (2018 – 2021) • Elevated the execution of sales and operations planning (S+OP) within the organization and with external supply chain partners. Leveraged, elevated, and expanded prior role span of control. • Led a diverse winemaking, grower relations, sustainability, safety, and warehouse/distribution team. • Drove robust demand and production planning processes that optimize the needs of both sales and operations. Spearheaded continuous improvement in forecast simulations to help the organization reach strategic and tactical operations and sales goals. • Key advisor during the company’s strategic multi-year project involving the JDE enterprise resource planning (ERP) system project implementation. Worked with outside integration consulting teams to provide insight and company requirements for multi-site production operations, finance, and distribution. • Balanced production capacity for FFCP and private label business (~25% of production volume) based on capacity constraints, revenue upside, offsite contract availability, and seasonal impacts. • Reduced surplus inventory by 38% over six months. Partnered with finance leadership and engaged with external brokers to establish pricing and purchasing guidelines. Realized an additional $700K in storage and transportation savings (~8%). • Secured long-term contract business to leverage internal capacities and drive resource utilization. Negotiated and set contract terms and evaluated regulatory compliance. VICE PRESIDENT OF FINANCE & OPERATIONS (2011 – 2018) • Oversight of costing,trade spend reporting and regulatory compliance. • Developed custom label business that accounted for ~10% of revenue and $24million in year three top-line revenue. Engaged in key accounts and buyer meetings to designing programs, developing contract terms, and instituting direct sales activity. • Led demand planning, compliance, and 3rd party warehouse teams in strategic inventory management for grape and bulk wine. Forecasted and planned for consistent stock availability of 250+ SKUs. • Managed cost of goods budgeting and methodology. Improved costing methodology and simplified cost categorization to streamline the planning process, leading to more accurate forecasting. • Implemented brand profitability models to analyze contribution by brand and by SKU. Developed an initial tool for leadership to enhance understanding of profit leaders across brands and customers. • Managed the capital expenditure process for highly varied company operations. Partnered with operations and direct-to-consumer (DTC) teams to provide project analytical support. • Collaborated with the executive team to manage the budget process. Led teams in common net revenue and contribution goal planning. Partner with sales on short- and long-range volume planning. Ascentia Wine Estates — Healdsburg, CA (2008 – 2011) VICE PRESIDENT OF FINANCE & OPERATIONS • Led demand planning, warehouse, compliance, and customer service teams in inventory management. • Managed costing, central finance, and winery finance teams to achieve common objectives and oversaw COGs methodology and implementation. Beam Wine Estates — Healdsburg, CA (2001 – 2008) DIRECTOR, OPERATION FINANCE (2008) | DIRECTOR, SUPPLY CHAIN (2007-2008) SUPPLY CHAIN MANAGER (2005-2007 | MANAGEMENT ACCOUNTANT (2001 - 2005) • Spanned multiple departments bringing analytical rigor and objective decision-making to supply chain operations, demand planning, costing, warehouse operations, and customer service. • Managed the company’s primary inventory planning model before, during, and after consolidations and acquisitions of Allied Domecq Wines and Beam Wine Estates. • Charged with driving long-term strategic inventory management approaches and execution of product and financial planning models that aligned with corporate P&L objectives. • Responsible for managing $160million in COGs, covering 10 brands. Geyser Peak Winery, Geyserville, CA | Senior Accountant (2000 – 2001) Textainer Equipment Management, San Francisco, CA | Senior Accountant (1995 – 2000) EDUCATION University of San Francisco, San Francisco, CA • Bachelor of Science (BS) in Accounting | Worked all four years in the admissions office recruiting, creating programming that engaged prospective students. Certified Management Accountant Program — Financial Planning, Performance and Control Technical Skills Familiarity: Microsoft Office Suite (Excel, PowerPoint, Teams, Word), Adobe Acrobat/PDF, JDE, SAP Page 2 of 2 EXHIBITB EXHIBIT Bottled Wine <16% Alc 31-Dec-23 Ret $/btl Retail Tot FOB Tot ASP Tot 750 Pallets 750 Cases 750x6, 375x12 Mag Cases Total Cases Bottles Mags Litres Gallons 1.00 0.5 0.83 08 AS Meritage 15 15.0 0.0 90.0 135 35.7 $100.00 $ 18,000 $ 9,000 $ 14,940 08 Blk 1 CS 12 12.0 144.0 108 28.5 $150.00 $ 21,600 $ 10,800 $ 17,928 08 Blk 4 CS 5 34 39.0 60.0 204.0 351 92.7 $150.00 $ 70,200 $ 35,100 $ 58,266 09 AS Meritage 6 6.0 36.0 54 14.3 $100.00 $ 7,200 $ 3,600 $ 5,976 09 Blk 2 23 23.0 138.0 207 54.7 $150.00 $ 41,400 $ 20,700 $ 34,362 09 Blk 1/4 17 18 35.0 204.0 108.0 315 83.2 $150.00 $ 63,000 $ 31,500 $ 52,290 10 AS Meritage Left 15 15.0 90.0 135 35.7 $125.00 $ 22,500 $ 11,250 $ 18,675 10 AS Meritage Center 9 9.0 54.0 81 21.4 $125.00 $ 13,500 $ 6,750 $ 11,205 10 AS Meritage Right 3 3.0 18.0 27 7.1 $125.00 $ 4,500 $ 2,250 $ 3,735 11 Meritage 25 25.0 300.0 225 59.4 $100.00 $ 30,000 $ 15,000 $ 24,900 11 AS Meritage 20 20.0 0.0 120.0 180 47.6 $125.00 $ 30,000 $ 15,000 $ 24,900 11 RR CS 47 47.0 564.0 423 111.7 $110.00 $ 62,040 $ 31,020 $ 51,493 12 PHAETON 22 22.0 0.0 132.0 198 52.3 $60.00 $ 15,840 $ 7,920 $ 13,147 12 AS 15 15.0 90.0 135 35.7 $125.00 $ 22,500 $ 11,250 $ 18,675 12 NV CS 22 22.0 132.0 198 52.3 $150.00 $ 39,600 $ 19,800 $ 32,868 14 1001 Prop Red 10 12 432.0 5,184.0 3,888 1,027.1 $80.00 $ 414,720 $ 207,360 $ 344,218 15 1001 Prop Red 19 798.0 9,576.0 7,182 1,897.3 $80.00 $ 766,080 $ 383,040 $ 635,846 15 Speedster 16 36 708.0 8,496.0 6,372 1,683.3 $60.00 $ 509,760 $ 254,880 $ 423,101 15 PHAETON 3 8 134.0 1,608.0 1,206 318.6 $60.00 $ 96,480 $ 48,240 $ 80,078 16 PHAETON 7 34 328.0 3,936.0 2,952 779.8 $60.00 $ 236,160 $ 118,080 $ 196,013 16 Speedster 3 32 158.0 1,896.0 1,422 375.6 $60.00 $ 113,760 $ 56,880 $ 94,421 16 1001 Prop Red 2 32 116.0 1,392.0 1,044 275.8 $80.00 $ 111,360 $ 55,680 $ 92,429 16 1001 Coombsville Cab 1 46 88.0 1,056.0 792 209.2 $135.00 $ 142,560 $ 71,280 $ 118,325 16 1001 Rutherford Cab 2 66 150.0 1,800.0 1,350 356.6 $135.00 $ 243,000 $ 121,500 $ 201,690 16 Clarksburg Malbec 2 52 136.0 1,632.0 1,224 323.3 $50.00 $ 81,600 $ 40,800 $ 67,728 16 CA Cab 3 24 150.0 1,800.0 1,350 356.6 $46.00 $ 82,800 $ 41,400 $ 68,724 16 NC Cab Franc 38 38.0 456.0 342 90.3 $56.00 $ 25,536 $ 12,768 $ 21,195 17 AS 40 40.0 480.0 360 95.1 $80.00 $ 38,400 $ 19,200 $ 31,872 17 1001 Rutherford Cab 5 28 308.0 3,696.0 2,772 732.3 $135.00 $ 498,960 $ 249,480 $ 414,137 17 1001 Rutherford Cab 2 4 45 269.0 3,228.0 2,421 639.6 $135.00 $ 435,780 $ 217,890 $ 361,697 18 1001 Rutherford Cab 4 17 241.0 2,892.0 2,169 573.0 $135.00 $ 390,420 $ 195,210 $ 324,049 18 1001 Prop Red 9 35 539.0 6,468.0 4,851 1,281.5 $80.00 $ 517,440 $ 258,720 $ 429,475 18 Artist Series 1 35 91.0 1,092.0 819 216.4 $80.00 $ 87,360 $ 43,680 $ 72,509 19 Artist Series 2 26 138.0 1,656.0 1,242 328.1 $80.00 $ 132,480 $ 66,240 $ 109,958 19 1001 Rutherford Cab 5 31 311.0 3,732.0 2,799 739.4 $135.00 $ 503,820 $ 251,910 $ 418,171 19 1001 Prop Red 3 24 192.0 2,304.0 1,728 456.5 $80.00 $ 184,320 $ 92,160 $ 152,986 19 Estate 53 53.0 636.0 477 126.0 $160.00 $ 101,760 $ 50,880 $ 84,461 19 AJ Res Chard 1 10 66.0 792.0 594 156.9 $42.00 $ 33,264 $ 16,632 $ 27,609 20 AJ Res Chard 9 14 518.0 6,216.0 4,662 1,231.6 $38.00 $ 236,208 $ 118,104 $ 196,053 20 Rose 61 67 3,483.0 41,796.0 31,347 8,280.9 $32.00 $ 1,337,472 $ 668,736 $ 1,110,102 9,793.0 115,092.0 88,137.0 23,283.2 $ 7,783,380 $ 3,891,690 $ 6,460,205 Bulk $ 10,310,732 $ 5,155,366 $ 8,557,907 Combined $ 18,094,112 $ 9,047,056 $ 15,018,113 EXHIBITC EXHIBIT C Bulk Wines < 16% Alc 31-Dec-23 Component of $/btl Ret Retail Value 50% FOB ASP at $45/gal # of Litres Gallons $ 1.00 $ 0.50 $ 0.83 $ 45.00 16 Cabernet Sauvignon Barrel 4 893.4 236.0 CA Cab $ 46.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 893.4 236.0 $ 54,736 $ 27,368 $ 45,431 $ 10,620 16 Cabernet Sauvignon Barrel 0.0 0.0 CA Cab $ 46.00 Heringer + Welch Merlot Puncheon 0.0 0.0 Includes 50% count of SV Cab Steel 15100.0 3989.0 Tank 8 Total Bulk 15100.0 3989.0 $ 925,172 $ 462,586 $ 767,893 $ 179,504 17 Cabernet Sauvignon Barrel 4 893.4 236.0 Napa Cab $ 135.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 893.4 236.0 $ 160,639 $ 80,319 $ 133,330 $ 10,620 17 Cab Franc Barrel 0.0 0.0 AS/1001/Napa Cab $ 100.00 Babcock Puncheon 0.0 0.0 Tank 63 Steel 3850.0 1017.1 Total Bulk 3850.0 1017.1 $ 512,801 $ 256,400 $ 425,624 $ 45,767 17 Petit Verdot Barrel 0.0 0.0 Ruth and AS $ 106.00 DBIC Puncheon 0.0 0.0 Steel 1825.0 482.1 Total Bulk 1825.0 482.1 $ 257,666 $ 128,833 $ 213,862 $ 21,695 17 Cabernet Sauvignon Barrel 0.0 0.0 Ruth Cab $ 135.00 Round Pond Puncheons 0.0 0.0 Per 17 Blending Steel 3200.0 845.3 Tank 1 Total Bulk 3200.0 845.3 $ 575,402 $ 287,701 $ 477,584 $ 38,040 17 Malbec Barrel 10 2250.0 594.4 AS / Ruth Cab/1001 $ 106.00 DBIC Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 2250.0 594.4 $ 317,670 $ 158,835 $ 263,666 $ 26,747 17 Merlot Barrel 0.0 0.0 1001/AS/Phaeton $ 80.00 La Cereces Puncheon 0.0 0.0 Tank 61 Steel 3500.0 924.6 + 3 barrels 17RPCS Total Bulk 3500.0 924.6 $ 372,946 $ 186,473 $ 309,545 $ 41,607 17 Malbec Barrel 0.0 0.0 Malbec $ 50.00 Heringer Puncheon 0.0 0.0 Tank 12 Steel 7600.0 2007.7 Total Bulk 7600.0 2007.7 $ 506,141 $ 253,070 $ 420,097 $ 90,346 18 AJ Heringer Tannat Barrel 10 2233.4 590.0 Malbec $ 50.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 2233.4 590.0 $ 148,739 $ 74,370 $ 123,454 $ 26,550 18 AJ Heringer CS Barrel 0.0 0.0 CA Cab $ 46.00 Tank 6&11 Puncheon 0.0 0.0 Steel 12158.8 3212.0 Total Bulk 12158.8 3212.0 $ 744,968 $ 372,484 $ 618,323 $ 144,540 18 AJ Heringer Malbec Barrel 0.0 0.0 CA Cab/ Malbec $ 48.00 Tank 5 Puncheon 0.0 0.0 Steel 5488.9 1450.0 Total Bulk 5488.9 1450.0 $ 350,924 $ 175,462 $ 291,267 $ 65,250 19 AJ DBIC Malbec Barrel 2 446.7 118.0 Napa Cabs/AS $ 106.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 446.7 118.0 $ 63,066 $ 31,533 $ 52,344 $ 5,310 19 AJ DBIC Merlot Barrel 1 223.3 59.0 AS/Napa Cabs $ 106.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 223.3 59.0 $ 31,533 $ 15,766 $ 26,172 $ 2,655 19 AJ DBIC PV Barrel 8 1786.7 472.0 Napa Cabs/AS/1001 $ 100.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 1786.7 472.0 $ 237,983 $ 118,992 $ 197,526 $ 21,240 20 Dry Creek CF Barrel 11 2456.8 649.0 CA Cab/1001/Franc $ 80.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 2456.8 649.0 $ 261,782 $ 130,891 $ 217,279 $ 29,205 20 Dry Creek Malbec Barrel 11 2456.8 649.0 Ca Cab/1001/AS $ 70.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 2456.8 649.0 $ 229,059 $ 114,529 $ 190,119 $ 29,205 21 DBIC Malbec Barrel 3 670.0 177.0 Napa Cab/Ruth/AS/1001 $ 106.00 Puncheon 2 984.2 260.0 Steel 0.0 0.0 Total Bulk 1654.2 437.0 $ 233,556 $ 116,778 $ 193,852 $ 19,665 21 DBIC Merlot Barrel 19 4243.5 1121.0 Napa Cab/Ruth/AS/1001 $ 100.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 4243.5 1121.0 $ 565,210 $ 282,605 $ 469,124 $ 50,445 21 DBIC PV Barrel 7 1563.4 413.0 Napa Cab/Ruth/AS/1001 $ 100.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 1563.4 413.0 $ 208,235 $ 104,118 $ 172,835 $ 18,585 21 Estate Cab S Barrel 1 223.3 59.0 Estate Cab $ 160.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 223.3 59.0 $ 47,597 $ 23,798 $ 39,505 $ 2,655 21 RP Cab S Barrel 10 2233.4 590.0 Ruth Cab $ 135.00 Puncheon 3 1476.3 390.0 Steel 0.0 0.0 Total Bulk 3709.7 980.0 $ 667,059 $ 333,529 $ 553,659 $ 44,100 22 AJW DBIC OK Malbec Barrel 10 2233.4 590.0 Napa Cab/AS/1001 $ 106.00 Puncheon 4 1968.4 520.0 Steel 0.0 0.0 Total Bulk 4201.8 1110.0 $ 593,244 $ 296,622 $ 492,392 $ 49,950 22 AJW Weiss AP Cab S Barrel 10 2233.4 590.0 Napa Cab $ 135.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 2233.4 590.0 $ 160,639 $ 80,319 $ 133,330 $ 26,550 22 AJW Hills RF Cab S Barrel 8 1786.7 472.0 Ruth Cab $ 135.00 Puncheon 4 1968.4 520.0 Steel 0.0 0.0 Total Bulk 3755.2 992.0 $ 675,227 $ 337,613 $ 560,438 $ 44,640 22 AJW Estate Cab S Barrel 3 670.0 177.0 Estate Cab $ 160.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 670.0 177.0 $ 142,790 $ 71,395 $ 118,516 $ 7,965 23 AJW Weiss AP Cab S Barrel 15 3325.1 878.4 Napa Cab $ 135.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 3325.1 878.4 $ 597,903 $ 298,951 $ 496,259 $ 39,528 23 AJW Hills RF Cab S Barrel 14 3185.8 841.6 Ruth Cab $ 135.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 3185.8 841.6 $ 572,854 $ 286,427 $ 475,469 $ 37,872 23 AJW Estate Cab S Barrel 2 446.7 118.0 Estate Cab $ 160.00 Puncheon 0.0 0.0 Steel 0.0 0.0 Total Bulk 446.7 118.0 $ 95,193 $ 47,597 $ 79,010 $ 5,310 Total Gallons 25,248 gallons $ 10,310,732 $ 5,155,366 $ 8,557,907 $ 1,136,167 10,608 Cases Retail Value 50% FOB ASP Firesale bulk DG Cost/Case 30 Cost to bottle 319,103 EXHIBITD EXHIBIT Bulk Wine 12/31/2023 Value per Value on Wine Description Vintage Appellation Gallons Gallon bulk market Comments 2016 Cabernet 2016 CA 236 $ 2.00 $ 472 2016 may not h