From selling a painting to exploring the value of its liquor license, Copia is working to identify assets that it can use to pay wages and benefits to former workers.

Napa’s failed center for wine, food and the arts, which filed for bankruptcy earlier this month, remains in negotiations over assets with insurance carrier ACA Guaranty Corp., which is on the hook for much of the $50 million to $100 million that Copia owes its bankers.

According to an e-mail Copia Chairman of the Board Joe Peatman sent to former employees last week, Copia hopes to get ACA’s agreement “to have some of the employees help with a clean-up/inventory sale, get all accrued vacation and payroll covered, and cover some insurance and wind-down expenses.”

Some of those efforts have already met with defeat, while others remain plausible.

The first blow came earlier this month, when Copia’s bid to immediately secure a $2 million line of credit was met with resistance by ACA. That failure prompted then Interim CEO Garry McGuire to step down. According to Peatman’s e-mail, “the rejection of the funding mechanism in court last Friday (Dec. 5) that would have allowed Copia to go forward on a reorganization plan was an extremely disappointing defeat that Garry took very hard...”

Another setback noted in the e-mail is that Copia’s liquor license is not transferable. Usually owners of restaurants or bars that are closing down have the right to sell their liquor licenses to other operators. In Napa County in recent years, such licenses have changed hands for about $250,000.

But Copia’s license comes with restrictions that it can be used only on that site and only by Copia. “The Copia liquor license is very specific and essentially un-transferable and thus holds no market value,” wrote Peatman in a Dec. 13 e-mail. 

Michael Korson, district administrator with the California Department of Alcoholic Beverage Control in Santa Rosa, said “that license was issued specifically for Copia at that location so it can’t leave that location.”

The only option would be to sell it to someone else at that same location, said Korson. The license was purchased for $12,000, he said.

Peatman mentioned two other options in the Dec. 13 e-mail to employees. One is to capitalize on the value of Copia’s intellectual property, which presumably would include recordings of past chef demonstrations, classes and seminars.

Another is to use $80,000 of the proceeds of a November sale of a painting, “Napa Valley Ridge” by Wayne Thiebaud, a highly-regarded California painter known for so-called “pop art” paintings of cakes, lipstick and other objects.

The painting was auctioned in New York on Nov. 13 for $1,142,500. However, Copia had hoped the painting would sell for closer to $2 million, and the center took an advance payment on the sale of the painting.

Peatman wrote that he believes Copia is owed some $80,000 from the proceeds, money that could be used to pay wages and wind-down costs.

Copia, envisioned by the late vintner Robert Mondavi as a way to toast Napa Valley’s role in the wine and culinary worlds, opened in 2001 and hosted numerous concerts and wine-and-food themed events. But it ran in the red from the beginning.

The recent downturn in the economy exerted more pressure on Copia to repay its financial backers, including banks that funded construction of the Copia building on a 12-acre site in downtown Napa.

Copia suddenly closed its restaurant, Julia’s Kitchen, and canceled scheduled events starting in mid-November, filed for Chapter 11 bankruptcy protection Dec. 1, and is expected to wind down operations completely sometime in January.

In the e-mail, Peatman reflected on Copia’s downfall.

“It seemed that at every turn, the winds kept turning against us the financial crisis killed the capital and debt markets that would have allowed Copia to address the debt in a more workable way and create a vibrant home for a re-tooled Copia,” he wrote.

“The art market then crashed, killing the prospect of an additional $1 million in funds to buy us more time to craft a workable solution.”