Court-Ordered Auction and $471K in Defaulted Loans Won't Close Ten 10 Brewing



By Mark Baratelli

Edited 12/31/16

Ten 10 Brewing was forced to put almost the entirety of its interior contents up for auction December 27th for $250,000 by court order. It was a bulk auction, which means everything had to go to one buyer. That buyer also had to pay in full December 28th and had to remove all contents by January 2, 2017. 

This of course does not mean the bar is closing necessarily. We reached out to owner Patrick McPherson today. While he offered no explanation of the court-ordered auction nor the two complaints against him, he did share a statement with us:
"Ten 10 Brewing Co. is open for business and will continue to be. We are expanding our operations, adding new equipment, and beginning distribution. Nothing about our daily operations has changed."
The auction was court ordered to help pay off $471,916 it owes to Richard and Monse McPherson. It defaulted on two loans and has been in default since October 2015. The McPhersons filed two Complaints on September 28, 2016 against Ten 10 Brewing Co, S.A. Casey Construction, Inc and Fairwinds Credit Union. Here's the story of how that went.


Those two complaints are as follows:
  • Count I - Breach of Notes 
  • Count II - Foreclosure of Security Agreement 

Ten 10 Brewing was accused of failing to make the December 25, 2015 payment under the First Note ($257,000) and each payment due thereafter, and failed to make the October 31, 2015 payment due under the Second Note ($210,000) and each payment thereafter. At the time of the Complain filing, Ten 10 brewing has failed to pay Plaintiffs all amounts owed under the Loan Documents, despite demand. All applicable cure periods had expired. 

The Plaintiffs, back in September, asked to take possession of the Collateral and dispose of it in a commercially reasonable manner, and, if necessary, order a public sale of the Collateral and establish a process for the sale in accordance with Florida law.

On October 5, 2015, Ten 10 Brewing admitted to 22 of the 29 complaints against them. They admitted the First Note and Second Note were in default and that the First Note and Second Note were secured by the Collateral, did not contest the total amounts owed under the Loan Documents, and did not assert any affirmative defenses.
On October 11, 2016, S.A. Casey Construction Inc responded to Plaintiffs’ counsel via letter, stating that it had been paid in full and had no unpaid balance/claim for payment against Debtor. The compliant was dropped against this corporation.

On November 3, 2016, a Clerk’s Default was entered against Fairwinds Credit Union, for its failure to serve or file any paper as required by law in response to the Complaint.

According to this November 4, 2016 document, the undisputed facts established that:

  1. Debtor executed the First Note, Second Note and Security Agreement, which are clear and unambiguous contracts
  2. Debtor failed to make all payments under the Notes;
  3. As a result of Debtor’s failure to pay all amounts owing under the Notes, Plainitffs have been damaged. 
Ten 10 Brewing had not refuted that it was not liable to Plaintiffs for breach of the First Note or the Second Note. As such, Plaintiffs were entitled to damages against Defendant and foreclosure of the Security Agreement resulting from Debtor’s breach of the First Note and Second Note. Moreover, no defenses have been asserted which preclude the entry of a summary final judgment for damages and foreclosure of security agreement.