Contract analysis

I. BACKGROUND AND DEPOSITION OBJECTIVES A. Overview of the Witness Dr. Priya Ramanathan, CFA, ASA, is the lead appraiser at Beacon Valuation Group Inc., with offices at 2600 South Bayshore Drive, Suite 1050, Miami, Florida 33133. She was retained by Meridian Shores Hospitality LLC ("MSH"), through its counsel Hargrove, Dunlap & Castillo LLP (lead partner Victoria Castillo), to prepare an appraisal of 100% of the real

1. Undermine the credibility of the 8.5% discount rate and 7.75% terminal capitalization rate used in the Beacon DCF analysis. These rates are materially below market for Gulf Coast luxury hotel properties as of the December 31, 2022 valuation date. The 8.5% discount rate is 225 basis points below the 10.75% rate used by Gerald K. Whitfield, MAI (Whitfield Realty Advisors LLC, PCG's appraiser), and published market d

2. Challenge the $8.2 million deferred-maintenance adjustment as speculative, unsupported by any independent engineering or property condition assessment, and improperly included in a fair market value determination. The adjustment appears to have been constructed from items identified by MSH or its principal Nathaniel Cordero, rather than through an independent investigation by the appraiser. Moreover, the adjustmen

3. Expose the absence of a sales-comparison approach, which is standard practice for hotel valuations under both USPAP and the Appraisal Institute's guidance, and which Whitfield weighted at 60% in his appraisal. Beacon's decision to rely exclusively on a single DCF analysis — an income approach that is highly sensitive to the discount rate and terminal cap rate assumptions that are themselves contested — renders the

4. Highlight methodological inconsistencies and departures from the Uniform Standards of Professional Appraisal Practice (USPAP) and Appraisal Institute standards. Under USPAP Standards Rule 1-4, an appraiser must consider all applicable approaches to value and explain the reasons for any departure. The absence of two of the three standard approaches, combined with the internal inconsistencies identified above (e.g.,

5. Establish that the Beacon appraisal's conclusions are an outlier relative to the Linden Park Advisory LLC ("Linden Park") neutral appraiser's preliminary indication of value of $130.0–$138.0 million (Thomas Carraway, MAI, FRICS, dated July 14, 2023). The Beacon appraisal at $151.5 million is $13.5 million to $21.5 million above the top of the Linden Park range, suggesting that it is the Beacon appraisal — not the

6. Lay the groundwork for PCG's position that the Whitfield appraisal at $118.0 million was reasonable and conducted in good faith under OA Section 12.4, thereby negating MSH's bad-faith claim under OA Section 12.7. To the extent that the Beacon appraisal is discredited, MSH's assertion that PCG's tender of $41.3 million was made in bad faith loses its evidentiary foundation, because the $118.0 million Whitfield appr

II. PRELIMINARY / FOUNDATIONAL QUESTIONS A. Qualifications and Professional Background The opening segment of the deposition should establish Dr. Ramanathan's qualifications and professional background with specificity. While she should be given reasonable latitude to describe her credentials, the examination should focus on eliciting facts that distinguish her qualifications from those of the other two appraisers in

III. APPRAISAL METHODOLOGY — OVERVIEW A. Approaches Employed This segment of the deposition should establish, clearly and unambiguously on the record, the methodological choices made in the Beacon appraisal — specifically, the decision to rely exclusively on a single income approach (a discounted cash flow model) and the omission of both the sales-comparison approach and the cost approach. Suggested lines of question

IV. INCOME APPROACH — DISCOUNT RATE CHALLENGE A. DCF Model Structure Before challenging the discount rate and terminal cap rate assumptions, it is important to establish the architecture of the DCF model to ensure a clear record of the inputs that drive the value conclusion. Suggested lines of questioning: • Establish the projection period used in the DCF model. How many years of explicit cash-flow projections were m

V. ABSENCE OF SALES-COMPARISON APPROACH A. Justification for Omission Suggested lines of questioning: • Return to and expand upon the questions raised in Section III regarding the omission of the sales-comparison approach. Ask Dr. Ramanathan to explain, in her own words, why the sales-comparison approach was not used in the Beacon appraisal. • If she claims that there were insufficient comparable sales to support a r

VI. $8.2 MILLION DEFERRED-MAINTENANCE ADJUSTMENT A. Nature and Basis of the Adjustment This is the third priority area for the deposition. The $8.2 million deferred-maintenance adjustment is both legally and factually problematic, and the examination should probe its foundations with specificity. Suggested lines of questioning: • Identify each specific deferred-maintenance item that comprises the $8.2 million total.

VII. "BELOW-MARKET" FRANCHISE AGREEMENT ADJUSTMENT A. Nature of the Adjustment Suggested lines of questioning: • Determine whether the Beacon appraisal included an explicit adjustment — either as a separate line item or embedded in the DCF cash-flow projections — for an alleged "below-market" Aurelian Hotels & Resorts franchise agreement. • If such an adjustment was included, what was the dollar value of the adjustme

VIII. APPRAISAL DIVERGENCE AND THE 10% THRESHOLD A. OA Section 12.4(c) Mechanics Dr. Ramanathan may or may not be familiar with the specific provisions of the Operating Agreement, but establishing her awareness (or lack thereof) of the contractual framework within which her appraisal operates is important. Suggested lines of questioning: • Is she aware that the Operating Agreement of Palmetto Grand Ventures LLC (Sect

IX. BIAS AND RELIABILITY INQUIRY A. Litigation Bias Suggested lines of questioning: • Establish the timeline that demonstrates Dr. Ramanathan was retained for litigation purposes, not as an independent appraiser in the ordinary course: (a) PCG's appraiser (Whitfield) completed his appraisal on February 10, 2023. (b) PCG tendered a buyout price of $41.3 million on or about March 10, 2023. (c) MSH rejected the tender o

X. DOCUMENTS TO USE AT DEPOSITION The following is the list of documents that should be assembled, pre-marked as exhibits (to the extent permitted by the JAMS scheduling order), and available for use during the deposition of Dr. Ramanathan. Copies should be prepared for the witness, the court reporter, opposing counsel, and the examining attorney. A. Beacon Valuation Group Inc. Appraisal Report, "Appraisal of The Pal

I. Dr. Ramanathan's engagement letter with MSH and/or Hargrove, Dunlap & Castillo LLP, including scope of engagement, fee arrangement, and any terms regarding independence or limitations. (For engagement and bias inquiry.) J. Dr. Ramanathan's billing records (Beacon Valuation Group Inc. invoices to MSH or Hargrove Dunlap), reflecting total fees billed, hourly rates, and time entries. (For bias and fee inquiry.) K. An