7:21‐、We had we had to provide or secure all the transportation to get the peppers to the plant. We were scheduling it. Those are all processes that normally a processor would do. We did those for Huy Fong. By 2013, the hot sauce maker's annual revenue reached $85 million. But within a few years, the relationship between Huy Fong and Underwood ranches began to fall apart.
At the end of 2016, we were pretty sure we had an agreement going forward because we were always planning three years ahead. We were securing land, hiring people, building equipment. But court documents show that in 2016, the Sriracha maker made an agreement with Underwood Ranches to purchase 1700 acres worth of peppers for $13,000 per acre.
Well, then, according to Craig, David Tran reneged on that deal. So he had all these peppers and no one all of a sudden to sell them to. Tran breached multiple financial agreements, including failure to pay in advance of $18 million. He began the formation of a new company called Chilico. Its goal was to source peppers for Huy Fong from different farmers.