Testimony of Bank Financial Consultant – Kevin Larin
Bank’s Financial Consultant Testifies Under Oath; Financial Data and Methodology Challenged
(Court Hearing Transcript – February 9, 2026)
The lender’s financial consultant testified under oath solely through cross-examination, as his direct testimony was submitted in advance by affidavit.
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Testimony Based Entirely on Pre-Submitted Affidavit
The witness confirmed that his direct testimony was presented through a sworn affidavit submitted prior to the hearing, and his in-court testimony was limited to cross-examination.
His analysis and conclusions presented at the hearing were therefore tied directly to the contents of that affidavit rather than new testimony introduced on the stand.
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Cash Flow Analysis Not Based on Complete Financial Review
The witness testified that his team did not prepare full financial statements and did not complete a full investigation of all underlying financial data.
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Dispute Over Cash Flow Forecast Presented in Affidavit
The witness relied on a document presented as a company cash flow forecast showing approximately $6.7 million in negative cash flow over a 13-week period.
During cross-examination, it was asserted that this document was a formatting template rather than an actual forecast, and that the company’s actual cash flow report for the same period reflected approximately $1.3 million in positive cash flow.
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Cash Flow Conclusions Depend on Assumptions About Debt and Adjustments
During cross-examination, the witness acknowledged that adjustments to certain items, including debt-related payments, could materially change conclusions about cash flow performance.
He agreed that different assumptions could lead to different interpretations of whether the business was operating at a loss or generating positive cash flow.
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Key Cash Flow Categories Included Unexplained or Unverified Items
The witness testified that certain material line items, including “Other/Uncategorized” cash outflows, could not be fully explained or substantiated based on the information available.
He confirmed that these amounts represented cash leaving the business without clear categorization, introducing uncertainty into the analysis.
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Analysis Combined Operating Performance with Debt and Non-Operating Payments
The witness confirmed that his cash flow analysis included payments related to financing arrangements and prior obligations, including debt-related payments.
He acknowledged that isolating operating cash flow would require additional assumptions and adjustments that were not fully performed in his analysis.
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Dispute Over Treatment of Tennessee Distilling Payments
The testimony focused heavily on whether payments related to prior obligations should be included in evaluating operating cash flow.
The witness acknowledged that including or excluding these payments could significantly affect reported results, depending on the analytical framework applied.
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Affidavit’s Asset Value Conclusion Based on Borrowing Base Methodology
The witness clarified that his statement regarding insufficient asset value to secure the loan was based on borrowing base calculations rather than an independent valuation of the company’s assets.
He confirmed that he was not offering a formal valuation opinion and that his analysis relied on lender-defined advance rates applied to receivables and inventory.
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Testimony Reflects Disputed Assumptions and Incomplete Financial Record
Throughout cross-examination, the witness acknowledged multiple areas where conclusions depended on assumptions, incomplete data, or interpretations of financial categorization.
The testimony reflects ongoing dispute over the accuracy, completeness, and interpretation of the financial data underlying the lender’s position.
Read the full filing → Testimony of Bank Financial Consultant