AG真人官方

 

UNITED STATES

 

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

 

FORM 10-Q

 

x QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934

For the quarterly period ended June 30, 2025

 

o TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE EXCHANGE ACT

 

Commission File Number 001-37610

 

WILLAMETTE VALLEY VINEYARDS, INC.

(Exact name of registrant as specified in charter)

 

Oregon		93-0981021
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

 

8800 Enchanted Way, S.E., Turner, Oregon	97392
(Address of principal executive offices)	(Zip Code)

 

Registrant’s telephone number, including area code: (503) 588-9463

 

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Exchange Act during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days:
x Yes o NO

 

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files):
x Yes o NO

 

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer,” and “smaller reporting company” in Rule 12b-2 of the Exchange Act:

 

	o Large accelerated filer	o Accelerated filer
	x Non-accelerated Filer	x Smaller reporting company
		o Emerging growth company

 

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. o

 

Indicate by checkmark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):

o YES x No

 

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class		Trading Symbol(s)		Name of each exchange on which registered
Common Stock		WVVI		NASDAQ Capital Market
Series A Redeemable Preferred Stock		WVVIP		NASDAQ Capital Market

 

Number of shares of common stock outstanding as of August 12, 2025: 4,964,529

WILLAMETTE VALLEY VINEYARDS, INC.

INDEX TO FORM 10-Q

 

Part I - Financial Information	3
Item 1 - Financial Statements (unaudited)	3
Condensed Balance Sheets	3
Condensed Statements of Operations	4
Condensed Statements of Shareholders’ Equity	5
Condensed Statements of Cash Flows	6
Notes to Unaudited Interim Financial Statements	7
Item 2 - Management’s Discussion and Analysis of Financial Condition and Results of Operations	13
Item 3 - Quantitative and Qualitative Disclosures about Market Risk	16
Item 4 - Controls and Procedures	17
Part II - Other Information	17
Item 1 - Legal Proceedings	17
Item 1A - Risk Factors	17
Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds	17
Item 3 - Defaults Upon Senior Securities	17
Item 4 - Mine Safety Disclosures	17
Item 5 - Other Information	17
Item 6 - Exhibits	18
Signatures	19

PART I: FINANCIAL INFORMATION

 

Item 1 – Financial Statements

 

WILLAMETTE VALLEY VINEYARDS, INC.

CONDENSED BALANCE SHEETS
(Unaudited)

 

		June 30,				December 31,
		2025				2024
ASSETS
CURRENT ASSETS
Cash and cash equivalents		$	350,643			$	320,883
Accounts receivable, net			2,215,818				3,151,810
Inventories			32,946,595				32,907,489
Prepaid expenses and other current assets			424,427				519,608
Income tax receivable			323,235				19,267
Total current assets			36,260,718				36,919,057
Other assets			13,824				13,824
Vineyard development costs, net			8,711,803				8,769,542
Property and equipment, net			50,643,122				52,012,151
Operating lease right of use assets			10,971,149				11,302,566
TOTAL ASSETS		$	106,600,616			$	109,017,140
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES
Accounts payable		$	1,951,957			$	1,584,466
Accrued expenses			1,747,315				2,097,736
Bank overdraft			213,520				473,016
Line of credit			446,882				2,405,815
Note payable			940,314				995,968
Current portion of long-term debt			979,668				952,171
Current portion of lease liabilities			472,282				481,801
Unearned revenue			2,160,700				2,470,125
Grapes payable			-				1,519,087
Total current liabilities			8,912,638				12,980,185
Long-term debt, net of current portion and debt issuance costs			15,436,053				12,911,831
Lease liabilities, net of current portion			11,117,733				11,354,746
Deferred income taxes			2,536,648				2,536,648
Total liabilities			38,003,072				39,783,410
COMMITMENTS AND CONTINGENCIES (NOTE 9)
SHAREHOLDERS’ EQUITY
Redeemable preferred stock, no par value, 100,000,000 shares authorized, 10,239,573 shares issued and outstanding, liquidation preference $43,620,581, at June 30, 2025 and 10,239,573 shares issued and outstanding, liquidation preference $42,494,228, at December 31, 2024.			44,483,749				43,357,396
Common stock, no par value, 10,000,000 shares authorized, 4,964,529 shares issued and outstanding at June 30, 2025 and December 31, 2024, respectively.			8,512,489				8,512,489
Retained earnings			15,601,306				17,363,845
Total shareholders’ equity			68,597,544				69,233,730
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		$	106,600,616			$	109,017,140

 

The accompanying notes are an integral part of this condensed financial statement

WILLAMETTE VALLEY VINEYARDS, INC.

CONDENSED STATEMENTS OF OPERATIONS

(Unaudited)

		Three months ended								Six months ended
		June 30,								June 30,
		2025				2024				2025				2024
SALES, NET		$	10,195,763			$	10,332,358			$	17,737,346			$	19,135,438
COST OF SALES			3,979,145				3,860,668				6,761,620				7,391,026
GROSS PROFIT			6,216,618				6,471,690				10,975,726				11,744,412
OPERATING EXPENSES
Sales and marketing			4,193,635				4,338,171				8,161,345				8,365,953
General and administrative			1,624,819				1,596,613				3,286,195				3,444,130
Total operating expenses			5,818,454				5,934,784				11,447,540				11,810,083
INCOME (LOSS) FROM OPERATIONS			398,164				536,906				(471,814	)			(65,671	)
OTHER INCOME (EXPENSE)
Interest expense, net			(270,145	)			(263,694	)			(568,366	)			(493,381	)
Other income, net			2,550				2,541				145,026				100,593
INCOME (LOSS) BEFORE INCOME TAXES			130,569				275,753				(895,154	)			(458,459	)
INCOME TAX (EXPENSE) BENEFIT			(37,774	)			(79,775	)			258,968				132,632
NET INCOME (LOSS)			92,795				195,978				(636,186	)			(325,827	)
Accrued preferred stock dividends			(563,176	)			(563,249	)			(1,126,353	)			(1,126,426	)
LOSS APPLICABLE TO COMMON SHAREHOLDERS		$	(470,381	)		$	(367,271	)		$	(1,762,539	)		$	(1,452,253	)
Loss per common share after preferred dividends, basic and diluted		$	(0.09	)		$	(0.07	)		$	(0.36	)		$	(0.29	)
Weighted-average number of common shares outstanding, basic and diluted			4,964,529				4,964,529				4,964,529				4,964,529

 

The accompanying notes are an integral part of this condensed financial statement

WILLAMETTE VALLEY VINEYARDS, INC.

CONDENSED STATEMENTS OF SHAREHOLDERS’ EQUITY

(Unaudited)

		Six-Month Period Ended June 30, 2025
		Redeemable
		Preferred Stock								Common Stock								Retained
		Shares				Dollars				Shares				Dollars				Earnings				Total
Balance at December 31, 2024			10,239,573			$	43,357,396				4,964,529			$	8,512,489			$	17,363,845			$	69,233,730
Preferred stock dividends accrued			-				563,177				-				-				(563,177	)			-
Net loss			-				-				-				-				(728,981	)			(728,981	)
Balance at March 31, 2025			10,239,573				43,920,573				4,964,529				8,512,489				16,071,687				68,504,749
Preferred stock dividends accrued			-				563,176				-				-				(563,176	)			-
Net income			-				-				-				-				92,795				92,795
Balance at June 30, 2025			10,239,573			$	44,483,749				4,964,529			$	8,512,489			$	15,601,306			$	68,597,544
		Six-Month Period Ended June 30, 2024
		Redeemable
		Preferred Stock								Common Stock								Retained
		Shares				Dollars				Shares				Dollars				Earnings				Total
Balance at December 31, 2023			10,046,833			$	42,388,036				4,964,529			$	8,512,489			$	19,734,680			$	70,635,205
Issuance of preferred stock, net			192,740				969,359				-				-				-				969,359
Preferred stock dividends accrued			-				563,177				-				-				(563,177	)			-
Net loss			-				-				-				-				(521,805	)			(521,805	)
Balance at March 31, 2024			10,239,573				43,920,572				4,964,529				8,512,489				18,649,698				71,082,759
Preferred stock dividends accrued			-				563,249				-				-				(563,249	)			-
Net income			-				-				-				-				195,978				195,978
Balance at June 30, 2024			10,239,573			$	44,483,821				4,964,529			$	8,512,489			$	18,282,427			$	71,278,737

 

The accompanying notes are an integral part of this condensed financial statement

WILLAMETTE VALLEY VINEYARDS, INC.

STATEMENTS OF CASH FLOWS

(Unaudited)

 

		Six months ended June 30,
		2025				2024
CASH FLOWS FROM OPERATING ACTIVITIES
Net loss		$	(636,186	)		$	(325,827	)
Adjustments to reconcile net loss to net cash from operating activities:
Depreciation and amortization			1,632,833				1,666,003
Non-cash lease expense			331,417				278,017
Debt issuance costs			10,575				6,624
Change in operating assets and liabilities:
Accounts receivable			935,992				(412,126	)
Inventories			(39,106	)			(1,177,789	)
Prepaid expenses and other current assets			95,181				226,893
Income taxes receivable			(303,968	)			(136,624	)
Unearned revenue			(309,425	)			(138,493	)
Lease liabilities			(246,532	)			(221,162	)
Grapes payable			(1,519,087	)			(2,446,233	)
Accounts payable			370,959				(59,276	)
Accrued expenses			(350,421	)			527,921
Net cash from operating activities			(27,768	)			(2,212,072	)
CASH FLOWS FROM INVESTING ACTIVITIES
Additions to vineyard development costs			(43,229	)			(126,735	)
Additions to property and equipment			(166,304	)			(1,061,541	)
Net cash from investing activities			(209,533	)			(1,188,276	)
CASH FLOWS FROM FINANCING ACTIVITIES
Payment on installment note for property purchase			(55,654	)			(51,148	)
Proceeds from (payments on) bank overdraft			(259,496	)			350,916
Payments on line of credit			(1,958,933	)			(350,567	)
Payments on long-term debt			(470,553	)			(258,030	)
Proceeds from long-term debt			3,011,697				3,500,000
Proceeds from issuance of preferred stock			-				250,502
Net cash from financing activities			267,061				3,441,673
NET CHANGE IN CASH AND CASH EQUIVALENTS			29,760				41,325
CASH AND CASH EQUIVALENTS, beginning of period			320,883				238,482
CASH AND CASH EQUIVALENTS, end of period		$	350,643			$	279,807
NON-CASH INVESTING AND FINANCING ACTIVITIES
Purchases of property and equipment and vineyard development costs included in accounts payable		$	6,999			$	89,152
Reduction in investor deposits for preferred stock		$	—			$	718,857
Accrued preferred stock dividends		$	1,126,353			$	1,126,426

 

The accompanying notes are an integral part of this condensed financial statement

NOTES TO UNAUDITED INTERIM FINANCIAL STATEMENTS

 

1) BASIS OF PRESENTATION

 

The accompanying unaudited interim financial statements as of June 30, 2025 and for the three and six months ended June 30, 2025 and 2024 have been prepared in conformity with accounting principles generally accepted in the United States (“U.S. GAAP”) for interim financial statements. The financial information as of December 31, 2024 is derived from the audited financial statements presented in the Willamette Valley Vineyards, Inc. (the “Company”) Annual Report on Form 10-K for the year ended December 31, 2024. Certain information or footnote disclosures normally included in financial statements prepared in accordance with U.S. GAAP have been condensed or omitted pursuant to the rules and regulations of the Securities and Exchange Commission. In the opinion of management, the accompanying financial statements include all adjustments necessary (which are of a normal recurring nature) for the fair statement of the results of the interim periods presented. The accompanying financial statements should be read in conjunction with the Company’s audited financial statements for the year ended December 31, 2024, as presented in the Company’s Annual Report on Form 10-K.

 

Operating results for the three and six months ended June 30, 2025 are not necessarily indicative of the results that may be expected for the entire year ending December 31, 2025, or any portion thereof.

 

The Company’s revenues include direct to consumer sales and national sales to distributors. These sales channels utilize shared resources for production, selling, and distribution.

 

Basic loss per share after preferred stock dividends are computed based on the weighted-average number of common shares outstanding each period.

 

The following table presents the earnings per share after preferred stock dividends calculation for the periods shown:

 

		Three months ended June 30,								Six months ended June 30,
		2025				2024				2025				2024
Numerator
Net income (loss)		$	92,795			$	195,978			$	(636,186	)		$	(325,827	)
Accrued preferred stock dividends			(563,176	)			(563,249	)			(1,126,353	)			(1,126,426	)
Net loss applicable to common shares		$	(470,381	)		$	(367,271	)		$	(1,762,539	)		$	(1,452,253	)
Denominator
Weighted-average number of common shares outstanding basic and diluted			4,964,529				4,964,529				4,964,529				4,964,529
Loss per common share after preferred dividends, basic and diluted		$	(0.09	)		$	(0.07	)		$	(0.36	)		$	(0.29	)

 

Subsequent to the filing of the 2024 Report there were no accounting pronouncements issued by the Financial Accounting Standards Board (“FASB”) that would have a material effect on the Company’s unaudited interim condensed financial statements. 

 

2) INVENTORIES

 

The Company’s inventories, by major classification, are summarized as follows, as of the dates shown:

 

Schedule of Inventories

		June 30, 2025				December 31, 2024
Winemaking and packaging materials		$	1,536,558			$	1,303,152
Work-in-process (costs relating to unprocessed and/or unbottled wine products)			13,941,550				14,990,375
Finished goods (bottled wine and related products)			17,468,487				16,613,962
Total inventories		$	32,946,595			$	32,907,489

3) PROPERTY AND EQUIPMENT, NET

 

The Company’s property and equipment consists of the following, as of the dates shown:

 

Schedule of Property and Equipment, Net

		June 30, 2025				December 31, 2024
Construction in progress		$	633,179			$	633,179
Land, improvements, and other buildings			15,342,674				15,342,674
Winery, tasting room buildings, and hospitality center			44,187,393				44,146,543
Equipment			20,957,492				20,835,506
Property and equipment, gross			81,120,738				80,957,902
Accumulated depreciation			(30,477,616	)			(28,945,751	)
Property and equipment, net		$	50,643,122			$	52,012,151

 

Depreciation expense for the three months ended June 30, 2025 and 2024 was $761,496 and $790,970, respectively. Depreciation expense for the six months ended June 30, 2025 and 2024 was $1,531,865 and $1,582,956, respectively.

 

4) DEBT

 

Line of Credit Facility – In December of 2005, the Company entered into a revolving line of credit agreement with Umpqua Bank (the “Credit Agreement”) that allows borrowing up to $2,000,000 against eligible accounts receivable and inventories, as defined in the agreement. The revolving line bears interest at prime less 0.5%, with a floor of 3.25%, is payable monthly, and is subject to renewal. In July 2021, the Company renewed the Credit Agreement until July 31, 2023. In November 2022, the Company increased the borrowing line up to $5,000,000. In July 2023 the line of credit was renewed for an additional two years. The Company had an outstanding line of credit balance of $446,882 at June 30, 2025, at an interest rate of 7.0%, and an outstanding line of credit balance of $2,405,815 at December 31, 2024, at an interest rate of 7.0%.

 

The line of credit agreement includes various covenants, which among other things, requires the Company to maintain minimum amounts of tangible net worth, debt-to-equity, and debt service coverage, as defined, and limits the level of acquisitions of property and equipment. As of December 31, 2024, the Company was in compliance with these financial covenants. In July 2025, the Company renewed the credit agreement until July 31, 2026.

 

Notes Payable – In February 2017, the Company purchased property, including vineyard land, bare land, and structures in the Dundee Hills American Viticultural Area (AVA) under terms that included a 15 year note payable with quarterly payments of $42,534, bearing interest at 6%. The note may be called by the owner, up to the outstanding balance, with 180 days written notice. As of June 30, 2025, the Company had a balance of $940,314 due on this note. As of December 31, 2024, the Company had a balance of $995,968 due on this note.

 

Long-Term Debt – The Company has four long term debt agreements with AgWest with an aggregate outstanding balance of $16,584,054 and $14,042,910 as of June 30, 2025 and December 31, 2024, respectively. The first two outstanding loans require monthly principal and interest payments of $62,067 for the life of the loans, at annual fixed interest rates of 4.75% and 5.21%, and with maturity dates of 2028 and 2032, respectively. These loans are collateralized against the property on the main estate in Salem. The third loan requires monthly principal and interest payments of $87,989 at an annual interest rate of 6.66%, and with a maturity date of 2039. The fourth loan allows borrowings up to $4,350,000 against property defined in the agreement. The line of credit bears interest at 7.10% and has a maturity date of April, 2027. The general purposes of these loans were to make capital improvements to the winery and vineyard facilities.

8

 

As of June 30, 2025, future minimum principal payments of long-term debt are as follows for the years ending December 31:

 

Schedule of Future Minimum Principal Payment for Long-Term Debt Maturities

2025			476,819
2026			1,008,215
2027			4,079,491
2028			1,130,789
2029			1,007,284
Thereafter			8,881,456
Total		$	16,584,054

 

As of June 30, 2025, the Company had unamortized debt issuance costs of $168,333. As of December 31, 2024, the Company had unamortized debt issuance costs of $178,908.

 

5) INTEREST AND TAXES PAID

 

Income taxes – The Company paid $45,000 in income taxes for the three months ended June 30, 2025 and zero in income taxes for the three months ended June 30, 2024. The Company paid $45,000 in income taxes for the six months ended June 30, 2025 and zero in income taxes for the six months ended June 30, 2024.

 

Interest – The Company paid $267,696 and $129,539 for the three months ended June 30, 2025 and 2024, respectively, in interest on debt and the line of credit. The Company paid $495,801 and $264,518 for the six months ended June 30, 2025 and 2024, respectively, in interest on debt and the line of credit.

 

6) SEGMENT REPORTING

 

The Company has identified two operating segments, Direct Sales and Distributor Sales, based upon their different distribution channels, margins and selling strategies. Direct Sales include retail sales in the tasting rooms, wine club sales, internet sales, on-site events, kitchen and catering sales and other sales made directly to the consumer without the use of an intermediary, including sales of bulk wine or grapes. Distributor Sales include all sales through a third party where prices are given at a wholesale rate.

 

The two segments reflect how the Company’s operations are evaluated by senior management and the structure of its internal financial reporting. The Company evaluates performance based on the gross profit of the respective business segments. Selling expenses that can be directly attributable to the segment, including depreciation of segment specific assets, are included, however, centralized selling expenses and general and administrative expenses are not allocated between operating segments. Therefore, net income (loss) information for the respective segments is not available. Discrete financial information related to segment assets, other than segment specific depreciation associated with selling, is not available and that information continues to be aggregated.

 

The following table outlines the sales, cost of sales, gross profit, directly attributable selling expenses, and contribution margin of the segments for the three and six month periods ended June 30, 2025 and 2024. Sales figures are net of related excise taxes.

 

Schedule of Segment reporting

		Three Months Ended June 30,
		Direct Sales								Distributor Sales								Unallocated								Total
		2025				2024				2025				2024				2025				2024				2025				2024
Sales, net		$	5,497,973			$	5,721,172			$	4,697,790			$	4,611,186			$	-			$	-			$	10,195,763			$	10,332,358
Cost of sales			1,451,868				1,608,422				2,527,277				2,252,246				-				-				3,979,145				3,860,668
Gross profit			4,046,105				4,112,750				2,170,513				2,358,940				-				-				6,216,618				6,471,690
Selling expenses			3,255,050				3,596,924				653,604				505,367				284,981				235,880				4,193,635				4,338,171
Contribution margin		$	791,055			$	515,826			$	1,516,909			$	1,853,573
Percent of total sales			53.9	%			55.4	%			46.1	%			44.6	%
General and administration expenses																			1,624,819				1,596,613				1,624,819				1,596,613
Income from operations																										$	398,164			$	536,906

		Six Months Ended June 30,
		Direct Sales								Distributor Sales								Unallocated								Total
		2025				2024				2025				2024				2025				2024				2025				2024
Sales, net		$	9,808,448			$	10,007,328			$	7,928,898			$	9,128,110			$	-			$	-			$	17,737,346			$	19,135,438
Cost of sales			2,637,462				2,903,567				4,124,158				4,487,459				-				-				6,761,620				7,391,026
Gross profit			7,170,986				7,103,761				3,804,740				4,640,651				-				-				10,975,726				11,744,412
Selling expenses			6,341,306				6,860,305				1,293,639				1,009,792				526,400				495,856				8,161,345				8,365,953
Contribution margin		$	829,680			$	243,456			$	2,511,101			$	3,630,859
Percent of total sales			55.3	%			52.3	%			44.7	%			47.7	%
General and administration expenses																			3,286,195				3,444,130				3,286,195				3,444,130
Loss from operations																										$	(471,814	)		$	(65,671	)

7) SALE OF PREFERRED STOCK

 

On July 1, 2022, the Company filed a shelf Registration Statement on Form S-3 (the “July 2022 Form S-3”) with the United States Securities and Exchange Commission (the “SEC”) pertaining to the potential future issuance of one or more classes or series of debt, equity, or derivative securities. The maximum aggregate offering amount of securities sold pursuant to the June 2022 Form S-3 is not to exceed $20,000,000. From August 1, 2022 to November 1, 2022 the Company filed with the SEC four Prospectus Supplements to the July 2022 Form S-3, pursuant to which the Company proposed to offer and sell, on a delayed or continuous basis, up to an aggregate of 1,076,578 shares of Series A Redeemable Preferred Stock having proceeds not to exceed an aggregate of $5,636,714. Each of these Prospectus Supplements established that our shares of preferred stock were to be sold in one to three offering periods offering prices including $5.15 per share, $5.25 per share and $5.35 per share. Net proceeds of $3,558,807 have been received under these offerings as of June 30, 2025 for the issuance of Preferred Stock.

 

On June 30, 2023, the Company filed with the SEC a Prospectus Supplement to the July 2022 Form S-3, pursuant to which the Company proposed to offer and sell, on a delayed or continuous basis, up to 727,835 shares of Series A Redeemable Preferred Stock having proceeds not to exceed $3,530,000. This Prospectus Supplement established that our shares of preferred stock were to be sold in two offering periods with two separate offering prices beginning with an offering price of $4.85 per share and concluding with an offering of $5.35 per share. On October 27, 2023, the Company filed with the SEC a Prospectus Supplement to the July 2022 Form S-3, pursuant to which the Company proposed to offer and sell, on a delayed or continuous basis, up to 288,659 shares of Series A Redeemable Preferred Stock having proceeds not to exceed $1,400,000. This Prospectus Supplement established that our shares of preferred stock were to be sold in one offering period with an offering price of $4.85 per share. Net proceeds of $3,938,066 have been received under these offerings as of June 30, 2025 for the issuance of Preferred Stock.

 

On June 17, 2025, the Company filed a shelf Registration Statement on Form S-3 (the “June 2025 Form S-3”) with the United States Securities and Exchange Commission (the “SEC”) pertaining to the potential future issuance of one or more classes or series of debt, equity, or derivative securities. The maximum aggregate offering amount of securities sold pursuant to the June 2025 Form S-3 is not to exceed $20,000,000. On July 3, 2025, the Company filed with the SEC a Prospectus Supplement to the June 2025 Form S-3, pursuant to which the Company proposed to offer and sell, on a delayed or continuous basis, up to 1,343,284 shares of Series A Redeemable Preferred Stock having proceeds not to exceed $4,500,000.

 

Shareholders have the option to receive dividends as cash or as a gift card for purchasing Company products. The amount of unused dividend gift cards at June 30, 2025 and December 31, 2024 was $1,457,927 and $1,853,982, respectively, and is recorded as unearned revenue on the balance sheets. Revenue from gift cards is recognized when the gift card is redeemed by a customer. When the likelihood of a gift card being redeemed by a customer is determined to be remote and the Company expects to be entitled to the breakage, then the value of the unredeemed gift card is recognized as revenue. We determine the gift card breakage rate based upon Company-specific historical redemption patterns. To date we have determined that no breakage should be recognized related to our gift cards.

 

Dividends accrued but not paid will be added to the liquidation preference of the stock until the dividend is declared and paid. At any time after June 1, 2021, the Company has the option, but not the obligation, to redeem all of the outstanding preferred stock in an amount equal to the original issue price plus accrued but unpaid dividends and a redemption premium equal to 3% of the original issue price.

 

8) LEASES

 

We determine if an arrangement is a lease at inception. On our condensed balance sheets, our operating leases are included in Operating lease right-of-use assets (ROU), Current portion of lease liabilities, and Lease liabilities, net of current portion. The Company does not currently have any finance leases.

 

ROU assets represent our right to use an underlying asset for the lease term and lease liabilities represent our obligation to make lease payments arising from the lease. Operating lease ROU assets and liabilities are recognized at the commencement date based on the present value of lease payments over the lease term. For leases that do not provide an implicit rate, we use our incremental borrowing rate based on the information available at commencement date in determining the present value of lease payments. We use the implicit rate when readily determinable. Lease expense for operating lease payments is recognized on a straight-line basis over the lease term.

 

Significant judgment may be required when determining whether a contract contains a lease, the length of the lease term, the allocation of the consideration in a contract between lease and non-lease components, and the determination of the discount rate included in our leases. We review the underlying objective of each contract, the terms of the contract, and consider our current and future business conditions when making these judgments.

10

 

Operating leases – Vineyard - In December 1999, under a sale-leaseback agreement, the Company sold approximately 79 acres of the Tualatin Vineyards property with a net book value of approximately $1,000,000 for approximately $1,500,000 cash and entered into a 20 year operating lease agreement, with three five-year extension options, and contains an escalation provision of 2.5% per year. The Company extended the lease in January 2019 until January 2025. The Company extended the lease in July 2024 until January 2030. This property is referred to as the Peter Michael Vineyard and includes approximately 69 acres of producing vineyards. For right of use asset and liability calculations the Company has concluded it is reasonably certain to extend available options through January 2035.

 

In December 2004, under a sale-leaseback agreement, the Company sold approximately 75 acres of the Tualatin Vineyards property with a net book value of approximately $551,000 for approximately $727,000 cash and entered into a 15 year operating lease agreement, with three five-year extension options, for the vineyard portion of the property. The first two five year extensions have been exercised. The lease contains a formula-based escalation provision with a maximum increase of 4% every three years. This property is referred to as the Meadowview Vineyard and includes approximately 49 acres of producing vineyards. For right of use asset and liability calculations the Company has concluded it is reasonably certain to extend available options through November 2033.

 

In February 2007, the Company entered into a lease agreement for 59 acres of vineyard land at Elton Vineyard. In June 2021 the Company entered into a new 11 year lease for this property. The lease contains an escalation provision tied to the CPI not to exceed 2% per annum. This property includes 54 acres of producing vineyards and 2 additional plantable acres. For right of use asset and liability calculations the Company has concluded it is reasonably certain to extend available options through December 2031.

 

In July 2008, the Company entered into a 34-year lease agreement with a property owner in the Eola Hills for approximately 110 acres adjacent to the existing Elton Vineyards site. These 110 acres are being developed into vineyards. Terms of this agreement contain rent increases, that rise as the vineyard is developed, and contains an escalation provision of CPI plus 0.5% per year capped at 4%. This property is referred to as part of Ingram Vineyard and includes 93 acres of producing vineyards and 17 additional plantable acres. For right of use asset and liability calculations the Company has concluded it is reasonably certain to extend available options through December 2053.

 

In March 2017, the Company entered into a 25-year lease for approximately 17 acres of agricultural land in Dundee, Oregon. This lease contains an annual payment that remains constant throughout the term of the lease. This property is referred to as part of Bernau Estate Vineyard and includes 9 acres of producing vineyards.

 

Operating Leases – Non-Vineyard – In September 2018, the Company renewed an existing lease for three years, with two one-year renewal options, for its McMinnville tasting room. In May 2022 the Company amended the lease to extend the lease to August 2025 with one three year renewal option and defined payments over the term of the lease. For right of use asset and liability calculations the Company has not included the renewal option.

 

In January 2018, the Company assumed a lease, through December 2022, for its Maison Bleue tasting room in Walla Walla, Washington. In January 2023, the Company entered into a new lease to December 2027 with one five year renewal option, and defined payments over the term of the lease. For right of use asset and liability calculations the Company has not included the renewal option.

 

In February 2020, the Company entered into a lease for 5 years, with three five-year renewal options for a retail wine facility in Folsom, California, referred to as Willamette Wineworks. The lease contains an escalation provision tied to the CPI not to exceed 3% per annum with increases not allowed in any year being carried forward to the following years. In January 2025 the Company amended the renewal options and extended the lease until February 2026. For right of use asset and liability calculations the Company has concluded it is reasonably certain to extend available options through February 2040.

 

In March 2021, the Company entered into a lease for 10 years, with two five-year renewal options for a retail wine facility in Vancouver, Washington. The lease defines the payments over the term of the lease and option periods. For right of use asset and liability calculations the Company has concluded it is reasonably certain to extend available options through August 2041.

 

In February 2022, the Company entered into a lease for 10 years, with three five-year renewal options for a retail wine facility in Lake Oswego, Oregon. The lease defines the payments over the term of the lease and option periods. For right of use asset and liability calculations the Company has concluded it is reasonably certain to extend available options through January 2042.

11

 

In May 2022, the Company entered into a lease for 10 years, with two five-year renewal options for a retail wine facility in Happy Valley, Oregon. The lease defines the payments over the term of the lease and option periods. For right of use asset and liability calculations the Company has concluded it is reasonably certain to extend available options through May 2042.

 

In January 2023, the Company entered into a lease for 10 years, with three five-year renewal options for a retail wine facility in Bend, Oregon. The lease defines the payments over the term of the lease. For right of use asset and liability calculations the Company has not included the renewal option.

 

The following tables provide lease cost and other lease information:

 

Schedule of Lease Cost and Information

		Six Months Ended				Six Months Ended
		June 30, 2025				June 30, 2024
Lease Cost
Operating lease cost - Vineyards		$	250,363			$	229,564
Operating lease cost - Other			492,682				496,980
Short-term lease cost			22,345				18,527
Total lease cost		$	765,390			$	745,071
Other Information
Cash paid for amounts included in the measurement of lease liabilities
Operating cash flows from operating leases - Vineyard		$	234,164			$	230,964
Operating cash flows from operating leases - Other		$	441,334			$	388,941
Weighted-average remaining lease term - Operating leases in years			14.37				15.39
Weighted-average discount rate - Operating leases			7.66	%			7.89	%

 

Right-of-use assets obtained in exchange for new operating lease obligations were zero for the six months ended June 30, 2025 and 2024.

 

As of June 30, 2025, maturities of lease liabilities were as follows: 

 

Schedule of Maturities of Lease Liabilities 

		Operating
Years Ended December 31,		Leases
2025		$	657,038
2026			1,312,758
2027			1,373,710
2028			1,366,420
2029			1,376,565
Thereafter			13,861,091
Total minimal lease payments			19,947,582
Less present value adjustment			(8,357,567	)
Operating lease liabilities			11,590,015
Less current lease liabilities			(472,282	)
Lease liabilities, net of current portion		$	11,117,733

 

9) COMMITMENTS AND CONTINGENCIES

 

Litigation – From time to time, in the normal course of business, the Company is a party to legal proceedings. Management believes that these matters will not have a material adverse effect on the Company’s financial position, results of operations, or cash flows, but, due to the nature of litigation, the ultimate outcome of any potential actions cannot presently be determined.

 

Grape Purchases – The Company has entered into long-term grape purchase agreements with a number of Willamette Valley wine grape growers. With these agreements the Company purchases an annually agreed upon quantity of fruit, at pre-determined prices, within strict quality standards and crop loads. The Company cannot calculate the minimum or maximum payment as such a calculation is dependent in large part on unknowns such as the quantity of fruit needed by the Company and the availability of grapes produced that meet the strict quality standards in any given year. If no grapes are produced that meet the contractual quality levels, the grapes may be refused, and no payment would be due.

ITEM 2: MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

 

As used in this Quarterly Report on Form 10-Q, “we,” “us,” “our” and “the Company” refer to Willamette Valley Vineyards, Inc.

 

Forward Looking Statements

 

This Management’s Discussion and Analysis of Financial Condition and Results of Operations and other sections of this Form 10-Q contain forward looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. These forward-looking statements involve risks and uncertainties that are based on current expectations, estimates and projections about the Company’s business, and beliefs and assumptions made by management. Words such as “expects,” “anticipates,” “intends,” “plans,” “believes,” “seeks,” “estimates”, “predicts,” “potential,” “should,” or “will” or the negative thereof and variations of such words and similar expressions are intended to identify such forward-looking statements. Therefore, actual outcomes and results may differ materially from what is expressed or forecasted in such forward-looking statements due to numerous factors, including, but not limited to: availability of financing for growth, availability of adequate supply of high quality grapes, successful performance of internal operations, impact of competition, changes in wine broker or distributor relations or performance, impact of possible adverse weather conditions, impact of reduction in grape quality or supply due to disease or smoke from forest fires, changes in consumer spending, and the reduction in consumer demand for premium wines. In addition, such statements could be affected by general industry and market conditions and growth rates, and general domestic economic conditions. Many of these risks as well as other risks that may have a material adverse impact on our operations and business, are identified in Item 1A “Risk Factors” in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024, as well as in the Company’s other Securities and Exchange Commission filings and reports. The forward-looking statements in this report are made as of the date hereof, and, except as otherwise required by law, the Company disclaims any intention or obligation to update or revise any forward-looking statements or to update the reasons why the actual results could differ materially from those projected in the forward-looking statements, whether as a result of new information, future events or otherwise.

 

Critical Accounting Policies

 

The foregoing discussion and analysis of the Company’s financial condition and results of operations are based upon our unaudited condensed financial statements, which have been prepared in accordance with U.S. GAAP. The preparation of these unaudited condensed financial statements requires the Company’s management to make estimates and judgments that affect the reported amounts of assets, liabilities, revenues and expenses, and related disclosure of contingent assets and liabilities. On an on-going basis, the Company evaluates its estimates, including those related to revenue recognition, collection of accounts receivable, valuation of inventories, and amortization of vineyard development costs. The Company bases its estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances. Actual results may differ from these estimates under different assumptions or conditions. A description of the Company’s critical accounting policies and related judgments and estimates that affect the preparation of the Company’s financial statements is set forth in the Company’s Annual Report on Form 10-K for the year ended December 31, 2024. Such policies were unchanged during the six months ended June 30, 2025.

 

Overview

 

The Company, one of the largest wine producers in Oregon by volume, believes its success is dependent upon its ability to: (1) grow and purchase high quality vinifera wine grapes; (2) vinify the grapes into premium, super premium and ultra-premium wine; (3) achieve significant brand recognition for its wines, first in Oregon, and then nationally and internationally; (4) effectively distribute and sell its products nationally; and (5) continue to build on its base of direct to consumer sales.

 

The Company’s goal is to continue to build on a reputation for producing some of Oregon’s finest, most sought-after wines. The Company has focused on positioning itself for strategic growth through property purchases, property development and issuance of the Company’s Series A Redeemable Preferred Stock (the “Preferred Stock”). Management expects near term financial results to be negatively impacted by these activities as a result of incurring costs of accrued preferred stock dividends, strategic planning and development costs and other growth associated costs.

The Company’s wines are made from grapes grown in vineyards owned, leased or contracted by the Company, and from grapes purchased from other vineyards. The grapes are harvested, fermented and made into wine primarily at the Company’s winery in Turner Oregon (the “Winery”) and the wines are sold principally under the Company’s Willamette Valley Vineyards label, but also under the Griffin Creek, Pambrun, Elton, Maison Bleue, Metis, Natoma, Pere Ami, Elton, Domaine Willamette and Tualatin Estates labels. The Company also owns the Tualatin Estate Vineyards and Winery, located near Forest Grove, Oregon and the Domaine Willamette Winery located near Dundee, Oregon. The Company generates revenues from the sales of wine to wholesalers and direct to consumers.

 

Direct to consumer sales primarily include sales through the Company’s tasting rooms, telephone, internet and wine club. Direct to consumer sales are at a higher unit price than sales through distributors due to prices received being closer to retail than those prices paid by wholesalers. The Company continues to emphasize growth in direct to consumer sales through the Company’s existing tasting rooms and the opening of new locations, and growth in wine club membership. Additionally, the Company’s Preferred Stock sales since August 2015 have resulted in approximately 14,385 new preferred stockholders many of which the Company believes are wine enthusiasts. When considering joint ownership, we believe these new stockholders represent approximately 21,577 current and potential customers of the Company.

 

Periodically, the Company will sell grapes or bulk wine, due to them not meeting Company standards or being in excess of production targets, however this is not a significant part of the Company’s activities.

 

The Company sold 83,968 and 91,102 cases of produced wine during the six months ended June 30, 2025 and 2024, respectively, a decrease of 7,134 cases, or 7.8% in the current year period over the prior year period. The decrease in wine case sales was the result of decreased case sales through distributors.

 

Cost of sales includes grape costs, whether purchased or grown at Company vineyards, winemaking and processing costs, bottling, packaging, warehousing, and shipping and handling costs. For grapes grown at Company vineyards, costs include farming expenditures and amortization of vineyard development costs.

 

At June 30, 2025, wine inventory included 244,252 cases of bottled wine and 497,066 gallons of bulk wine in various stages of the aging process. Case wine is expected to be sold over the next 12 to 24 months and generally before the release date of the next vintage. The Winery bottled 93,462 cases during the six months ended June 30, 2025.

 

Willamette Valley Vineyards continues to receive positive recognition through national magazines, regional publications, local newspapers and online bloggers including the accolades below. 

 

The tasting room at the Company’s Estate Winery in the Salem Hills, Oregon was awarded the Best Wine Tasting Room in the country by USA Today in their 10 Best Readers’ Choice Awards for the second consecutive year. The Company was also awarded the #2 Best Wine Club in the nation by USA Today for the second consecutive year.

 

James Suckling rated the 2023 Whole Cluster Pinot Noir 92 points, and the 2023 White Pinot Noir 91 points.

 

James Suckling rated the 2023 Whole Cluster Pinot Noir 92 points.

 

International Wine Report awarded the 2022 Tualatin Estate Pinot Noir 93 points and the 2021 Elton Self-Rooted Pinot Noir 92 points.

 

Wine Enthusiast Magazine rated the 2023 Whole Cluster Pinot Noir, 2023 White Pinot Noir, 2023 Bernau Block Chardonnay and 2021 Domaine Willamette Brut 91 points.

 

RESULTS OF OPERATIONS

 

Revenue

 

Sales revenue for the three months ended June 30, 2025 and 2024 were $10,195,763 and $10,332,358, respectively, a decrease of $136,595, or 1.3%, in the current year period over the prior year period. This decrease was caused by a decrease in direct sales of $223,199, partly offset by an increase in sales through distributors of $86,604 in the current year three-month period over the prior year period. The decrease in revenue from direct sales was primarily related to lower internet and telephone sales. Sales revenue for the six months ended June 30, 2025 and 2024 were $17,737,346 and $19,135,438, respectively, a decrease of $1,398,092, or 7.3%, in the current year period over the prior year period. This decrease was caused by a decrease in revenues from direct sales of $198,880 and a decrease in revenues from sales through distributors of $1,199,212 in the current year period over the prior year period. The decrease in revenues from sales through distributors was primarily the result of lower case sales in the current year.

Cost of Sales

 

Cost of Sales for the three months ended June 30, 2025 and 2024 were $3,979,145 and $3,860,668, respectively, an increase of $118,477, or 3.1%, in the current period over the prior year period. This change was primarily the result of higher cost products sold in the current quarter compared to the same quarter last year. Cost of Sales for the six months ended June 30, 2025 and 2024 were $6,761,620 and $7,391,026, respectively, a decrease of $629,406 or 8.5%, in the current period over the prior year period. This change was primarily the result of lower case sales in the first six months of 2025 when compared to the same period in 2024.

 

Gross Profit

 

Gross profit as a percentage of net sales for the three months ended June 30, 2025 and 2024 was 61.0% and 62.6%, respectively, a decrease of 1.6 percentage points in the current year period over the prior year period, mostly as a result of more discounts on products compared to the same quarter of 2024. Gross profit as a percentage of net sales for the six months ended June 30, 2025 and 2024 was 61.9% and 61.4%, respectively, an increase of 0.5 percentage points in the current year period over the prior year period. The increase was primarily the result of higher prices being charged for products in direct sales in the first six months of 2025 compared to the same period in the prior year.

 

Selling, General and Administrative Expenses

 

Selling, general and administrative expenses for the three months ended June 30, 2025 and 2024 was $5,818,454 and $5,934,784 respectively, a decrease of $116,330, or 2.0%, in the current quarter over the same quarter in the prior year. This decrease was primarily the result of a decrease in selling and marketing expenses of $144,536, or 3.3% being partially offset by an increase in general and administrative expenses of $28,206, or 1.8% in the current quarter compared to the same quarter last year. Selling, general and administrative expense for the six months ended June 30, 2025 and 2024 was $11,447,540 and $11,810,083, respectively, a decrease of $362,543, or 3.1%, in the current year period over the prior year period. This decrease was primarily the result of a decrease in selling and marketing expenses of $204,608, or 2.4% combined with a decrease in general and administrative expenses of $157,935, or 4.6% in the current year period compared to the same period in 2024. General and administrative expenses decreased in the first six months of 2025 compared to the same period in the prior year primarily as a result of lower legal costs.

 

Interest Expense

 

Interest expense for the three months ended June 30, 2025 and 2024 was $270,145 and $263,694, respectively, an increase of $6,451 or 2.4%, in the second quarter of 2025 over the same quarter in the prior year. Interest expense for the six months ended June 30, 2025 and 2024 was $568,366 and $493,381, respectively, an increase of $74,985 or 15.2%, in the current year period over the prior year period. The increase in interest expense for the second quarter and first six months of 2025 was primarily the result of increased long term debt compared to the second quarter and first six months of 2024.

 

Income Taxes

 

The income tax expense for the three months ended June 30, 2025 and 2024 was $37,774 and $79,775, respectively, a decrease of $42,001 or 52.6%, in the second quarter of 2025 over the same quarter in the prior year mostly as a result of the lower pre-tax income in the second quarter of 2025, compared to the same quarter in 2024. The Company’s estimated federal and state combined income tax rate was 28.9% and the three months ended June 30, 2025 and 2024. The income tax benefit for the six months ended June 30, 2025 and 2024 was $258,968 and $132,632, respectively, an increase of $126,336 or 95.3% in the current year period over the prior year period, mostly a result of a higher pre-tax loss in the first six months of 2025, compared to the same period in 2024. The Company’s estimated federal and state combined income tax rate was 28.9% for the six months ended June 30, 2025 and 2024.

 

Net Income (Loss)

 

Net income for the three months ended June 30, 2025 and 2024 was $92,795 and $195,978, respectively, a decrease of $103,183, or 52.7%, in the second quarter of 2025 over the same quarter in the prior year. Net loss for the six months ended June 30, 2025 and 2024 was $636,186 and $325,827, respectively, an increase of $310,359, or 95.3%, in the current year period over the prior year period. The decrease in net income for the second quarter and increase in net loss for the first half of 2025, compared to the comparable periods in 2024, was primarily the result of lower revenue in 2025.

Net Loss Applicable to Common Shareholders

 

Net loss applicable to common shareholders for the three months ended June 30, 2025 and 2024 was $470,381 and $367,271, respectively, an increase of $103,110, or 28.1%, in the second quarter of 2025 over the same quarter in the prior year. Net loss applicable to common shareholders for the six months ended June 30, 2025 and 2024 was $1,762,539 and $1,452,253, respectively, an increase of $310,286, or 21.4%, in the current year period over the prior year period. The increase in loss applicable to common shareholders in the second quarter and the first six months of 2025, compared to the same period of 2024, was the result of a higher net loss in the current period.

 

Liquidity and Capital Resources

 

At June 30, 2025, the Company had a working capital balance of $27.3 million and a current working capital ratio of 4.07:1.

 

At June 30, 2025, the Company had a cash balance of $350,643. At December 31, 2024, the Company had a cash balance of $320,883.

 

Total cash used for operating activities in the six months ended June 30, 2025 was $27,768. Cash used in operating activities for the six months ended June 30, 2025 was primarily associated with a net loss, as well as reduced grapes payable and accrued expenses, being partially offset by depreciation and amortization.

 

Total cash used in investing activities in the three months ended June 30, 2025 was $209,533. Cash used in investing activities for the six months ended June 30, 2025 consisted of cash used on equipment and vineyard development costs.

 

Total cash generated from financing activities in the six months ended June 30, 2025 was $267,061. Cash generated from financing activities for the six months ended June 30, 2025 primarily consisted of proceeds from long-term debt being partially offset by the repayment of long-term debt and the line of credit.

 

In December of 2005, the Company entered into a revolving line of credit agreement with Umpqua Bank (the “Credit Agreement”) that allows borrowing up to $2,000,000 against eligible accounts receivable and inventories, as defined in the agreement. The revolving line bears interest at prime less 0.5%, with a floor of 3.25%, is payable monthly, and is subject to renewal. In July 2021, the Company renewed the Credit Agreement until July 31, 2023. In November 2022, the Company increased the borrowing line up to $5,000,000. In July 2023 the line of credit was renewed for an additional two years. The Company had an outstanding line of credit balance of $446,882 at June 30, 2025, at an interest rate of 7.0%, and an outstanding line of credit balance of $2,405,815 at December 31, 2024, at an interest rate of 7.0%.

 

The line of credit agreement includes various covenants, which among other things, requires the Company to maintain minimum amounts of tangible net worth, debt-to-equity, and debt service coverage, as defined, and limits the level of acquisitions of property and equipment. As of December 31, 2024, the Company was in compliance with these financial covenants. In July 2025, the Company renewed the credit agreement until July 31, 2026.

 

As of June 30, 2025, the Company had a 15-year installment note payable of $940,314, due in quarterly payments of $42,534, associated with the purchase of property in the Dundee Hills AVA.

 

As of June 30, 2025, the Company had a total long-term debt balance of $16,584,054, including the portion due in the next year, owed to AgWest, exclusive of debt issuance costs of $168,333. As of December 31, 2024, the Company had a total long-term debt balance of $14,042,910, exclusive of debt issuance costs of $178,908.

 

The Company believes that cash flow from operations and funds available under the Company’s existing credit facilities and through preferred stock sales will be sufficient to meet the Company’s long-term needs.

 

ITEM 3: QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

 

As a smaller reporting company, the Company is not required to provide the information required by this item.

ITEM 4: CONTROLS AND PROCEDURES

 

Disclosure Controls and Procedures – The Company carried out an evaluation as of the end of the period covered by this Quarterly Report on Form 10-Q, under the supervision and with the participation of the Company’s management, including the Company’s President and the Company’s Chief Financial Officer, of the effectiveness of the Company’s disclosure controls and procedures pursuant to paragraph (b) of Rule 13a-15 and 15d-5 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). Based on that review, the President and the Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are effective, as of the end of the period covered by this report, to ensure that information required to be disclosed by the Company in the reports the Company files or submit under the Exchange Act (1) is recorded, processed, summarized, and reported within the time periods specified in the Securities and Exchange Commission’s rules and forms, and (2) is accumulated and communicated to the Company’s management, including the Company’s principal executive officer and principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.

 

Changes in Internal Control over Financial Reporting – There have been no changes in our internal control over financial reporting during the quarter ended June 30, 2025 that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

 

PART II: OTHER INFORMATION

 

Item 1 - Legal Proceedings

 

From time to time, the Company is a party to various judicial and administrative proceedings arising in the ordinary course of business. The Company’s management and legal counsel have reviewed the probable outcome of any proceedings that were pending during the period covered by this report, the costs and expenses reasonably expected to be incurred, the availability and limits of the Company’s insurance coverage, and the Company’s established liabilities. While the outcome of legal proceedings cannot be predicted with certainty, based on the Company’s review, the Company believes that any unrecorded liability that may result as a result of any legal proceedings is not likely to have a material effect on the Company’s liquidity, financial condition or results from operations.

 

Item 1A - Risk Factors

 

In addition to the other information set forth in this Quarterly Report, you should carefully consider the factors discussed in Part I, “Item 1A. Risk Factors” in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, which could materially affect our business, results of operations or financial condition.

 

Additional risks and uncertainties not currently known to us or that we currently deem to be immaterial also may eventually prove to materially adversely affect our business, impact our results of operations or financial condition.

 

Item 2 - Unregistered Sales of Equity Securities and Use of Proceeds

 

None.

 

Item 3 - Defaults Upon Senior Securities

 

None.

 

Item 4 - Mine Safety Disclosures

 

Not applicable.

 

Item 5 – Other Information

 

During the three months ended June 30, 2025, no director or officer (as defined in Rule 16a-1(f) of the Exchange Act) of the Company adopted or terminated a “Rule 10b5-1 trading arrangement” or “Non-Rule 10b5-1 trading arrangement” as each term is defined in Item 408(a) of Regulation S-K.

Item 6 – Exhibits

 

3.1	Articles of Incorporation of Willamette Valley Vineyards, Inc. (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, filed on May 13, 2025, File No. 001-37610).
3.2	Articles of Amendment, dated August 22, 2000 (incorporated herein by reference to Exhibit 3.4 to the Company’s Form 10-Q for the quarterly period ended June 30, 2008, filed on August 14, 2008, File No. 000-21522).
3.3	Articles of Correction to the Articles of Amendment to the Articles of Incorporation of Willamette Valley Vineyards, Inc., dated June 22, 2015 (incorporated by reference to Exhibit 3.3 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, filed on May 13, 2025, File No. 001-37610).
3.4	Articles of Amendment to the Articles of Incorporation of Willamette Valley Vineyards, Inc., dated June 22, 2015, as corrected on July 22, 2015 (incorporated by reference to Exhibit 3.4 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, filed on May 13, 2025, File No. 001-37610).
3.5	Articles of Amendment to the Articles of Incorporation of Willamette Valley Vineyards, Inc., dated March 16, 2016 (incorporated by reference to Exhibit 3.5 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, filed on May 13, 2025, File No. 001-37610).
3.6	Articles of Amendment to the Articles of Incorporation of Willamette Valley Vineyards, Inc., dated August 9, 2022. (incorporated by reference to Exhibit 3.1 to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended March 31, 2025, filed on May 13, 2025, File No. 001-37610).
3.7	Amended and Restated Bylaws of Willamette Valley Vineyards, Inc. (incorporated by reference from the Company’s Current Reports on Form 8-K filed on November 20, 2015, File No. 001-37610)
31.1	Certification of Principal Executive Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934 (Filed herewith)
31.2	Certification of Chief Financial Officer required by Rule 13a-14(a) or Rule 15d-14(a) of the Securities Exchange Act of 1934 (Filed herewith)
32.1	Certification of James W. Bernau pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Filed herewith)
32.2	Certification of John Ferry pursuant to 18 U.S.C. Section 1350 as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002 (Filed herewith)
101	The following financial information from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2025, formatted in Inline Extensible Business Reporting Language (iXBRL): (i) Condensed Balance Sheets, (ii) Condensed Statements of Operations; (iii) Condensed Statements of Shareholders’ Equity; (iv) Condensed Statements of Cash Flows; and (iv) Notes to Financial Statements, tagged as blocks of text. (Filed herewith)
104	The cover page from the Company’s Quarterly Report on Form 10-Q for the quarter ended June 30, 2025 has been formatted in Inline XBRL

SIGNATURES

 

Pursuant to the requirements of the Security Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

 

WILLAMETTE VALLEY VINEYARDS, INC.
Date: August 12, 2025	By	/s/ James W. Bernau
	James W. Bernau
	President
	(Principal Executive Officer)
Date: August 12, 2025	By	/s/ John Ferry
	John Ferry
	Chief Financial Officer
	(Principal Accounting and Financial Officer)