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E CONOMICS lished offices in San Francisco and Santa Rosa. They are a barrel-specific leasing outfit that facilitates the loan, while Bank of the West services it. H&A is strictly a financial partner with no allegiance to any specific cooperage. H&A Financing's European roots can come in handy when sourcing barrels abroad. Jon Pelleriti, CFO of Healdsburg, Calif.-based Wilson Artisan Wineries, which comprises six wineries, has been in contract with H&A Financing for the winery's first leasing cycle. Wilson Winer- ies is currently leasing between 150 and 170 French and American oak barrels. "H&A has a good relationship with the European coopers. Working directly with coopers, they could speak with them and get invoices, facilitating a smooth busi- ness transaction. Since they are new to the area, it was a good financing opportunity for us, and we were their first American customer," Pelleriti said. Contract flexibility and post-lease service set H&A apart from other barrel leasing options. Charles A. Alvarez, sales director at H&A Finance, said, "Lease contracts are totally flexible. Rate and payment are the keys to the negotiation. Once the contract is signed you can remove barrels from your Though wineries have the option to keep their barrels at the end of the lease, through H&A Network, barrel inventories can be presold at an agreed-upon minimum resale amount via an established network—even inventory and resell them yourself or via the H&A Network. There are no penalties or documentation fees for changes." As hinted by Hansel Leasing, H&A's lowest limit for lease considerations is $15,000. Their typical winery clients finance barrel inventories to the tune of $150,000 for a span of three years. before the leasee racks out of them. "On a given date, when the barrels have reached their useful lifespan in your cellar, a truck pulls up and takes your barrels away," Al- varez said. The funds from the barrel resale can be rolled into the next barrel lease so you can avoid paying taxes on what would otherwise be seen as profit. H&A also offers an online barrel in- ventory management system to help track oak assets and inventory, details of the lease contract, barrel orders and barrel resale. All data can be accessed online and exported to an Excel spreadsheet. The icing on the barrel leasing cake is that some coopers may be more willing to offer a discount on barrel purchases when working with a bank or leasing company. François Peltereau-Villeneuve, president and CEO of Seguin Moreau, Napa, Calif., remarked that though barrel leasing is more common in Europe, "On a case-by- case basis, depending on various criteria, if winery comes cash in hand with immediate payment instead of paying the usual net 30 or 60, we would consider a 1% to 3% discount." In this case, it takes qualifying for money to save money. The resulting savings could apply toward the interest on your barrel lease. 36 Wines & Vines sePTeMBeR 201 1