Press Release: Deerfield Ranch Winery Successfully Exits Chapter 11
April 29, 2016
Deerfield Ranch Winery, LLC has successfully restructured its debt with Rabobank, exits Chapter 11, and looks forward to expanding its production of award-winning wines. Deerfield’s plan of reorganization, approved by Judge Jaroslovsky, provides for payment in full to all of its creditors as well as restructuring its loan with Rabobank, N.A., its principal secured lender.
Deerfield sought protection of the court after experiencing substantial delays in completing the left turn lane off Highway 12 that was a condition of opening their newly-constructed 23,000 square foot wine cave and tasting room. The road construction took five years and substantially reduced Deerfield’s revenues. The left turn lane was eventually completed, and the wine cave and tasting room is now a huge success.
“Deerfield’s operations have been profitable for several years. The delay in opening the tasting room was a problem that is now behind us. We look forward to expanding our wine business as well as our substantial custom crush business. We are extremely optimistic about the future of the Deerfield Ranch Winery. As a matter of fact, we are releasing our first Sparkling wine, a vintage blanc de blanc to celebrate our reorganization,” said Robert Rex, Winemaker and Managing Partner.
One of the primary accomplishments of the plan of reorganization is a restructured and extended lending agreement with Rabobank. “We are grateful that Rabobank was willing to work cooperatively with Deerfield and to agree on a new lending relationship. We are now in a position to explore a strategic alliance,” said P.J. Rex, Managing Partner. Deerfield has already received multiple business offers, including a creamery partnership, foreign investors, and wineries looking for a public tasting room on Highway 12. “We are looking for the perfect fit. Partnerships are a lot like marriage. To make it work, both parties need to be on the same page. Now that we have reorganized our debt, we will be our exploring our options,” she said.
Deerfield accomplished its restructuring with the assistance of Operations Manager Addison Rex, and a team of legal and financial advisors, experts in both the wine industry and the reorganization process, including Bill Brinkman, of the financial advisory firm Jigsaw Advisors. McNutt Law Group LLP provided legal advice, filed Deerfield’s Chapter 11 and confirmed their plan of reorganization. McNutt Law Group has assisted a number of wineries and vineyards in addressing financial challenges. The principal lawyers at McNutt Law Group were Scott McNutt and Shane Moses.
“The Rexes are good people. Their objectives throughout this case have been to pay all their vendors, to confirm a plan of reorganization, and to continue to make world-class of wine. We are proud to have been able to play a supporting role in this successful case,” said Scott McNutt.
Judge Alan Jaroslovsky, of the United States Bankruptcy Court of the Northern District of California, Santa Rosa Division presided over Deerfield’s case. As stated by Scott McNutt, “Judge Jaroslovsky was a huge asset in moving this case toward a successful conclusion. His Court is in Santa Rosa, and he hears most of the cases concerning vineyards and wineries located in the Sonoma and Napa Valleys.”
Also an asset in the process was Judge Thomas Carlson, United States Bankruptcy Judge for the Northern District of California, San Francisco Division, who volunteered to serve as a mediator in the restructuring proceeding. “Judge Carlson was absolutely selfless in devoting himself to bringing the parties together, and making this a successful reorganization,” continued Scott McNutt.
The Rexes have been residents of Kenwood for 34 years. They founded Deerfield Ranch Winery in 1982, and in 2000 bought 27 acres on Highway 12 in Kenwood to expand the winery. Deerfield is an organic winery that prides itself for being stewards of the environment. Deerfield is restoring 14 acres of wetlands and has granted the County of Sonoma a permanent easement to protect this wildlife habitat, home of the endangered Kenwood Marsh Checkerbloom.
Deerfield recycles 98% of their water usage through a bioreactor and composts 100% of its production waste. Winemaker, Robert Rex, is at the forefront of the Clean Wine™ movement, creating wines low in histamines and low in sulfites, which are known to cause allergic reactions. Deerfield Ranch Winery has a vested permit from the County of Sonoma to build a state-of-the-art gravity flow winery on top of their 23,000 square foot wine cave.