USPAP DOES NOT DICTATE FORM, FORMAT OR STYLE

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1 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 1 OF 34 APPRAISERS CERTIFICATION APPRAISAL COMPANY NAME is a registered firm of appraisers qualified to appraise residential contents, fine art, antiques, and jewelry. APPRAISER S NAME, AAA, (Fine Art Appraiser) examined and photographed all articles. She closely examined and appraised the articles of fine art, silver, and china (Decorative Art Appraiser) examined and appraised all articles of furniture and rugs , ---. assisted in the examination and the appraisal of the Fine and Decorative art , GG examined and appraised all items of jewelry. Valuation is based solely on personal research and analysis of comparative market data SAMPLE as performed by the appraisers and office REPORT assistants at APPRAISAL COMPANY NAME. No other party was significant in the valuation of the appraised property. Although the statements of fact contained in this report are true and correct, the reported analyses, opinions, and conclusions are limited only by the reported assumptions, extraordinary assumptions, limiting conditions, and hypothetical conditions. The values expressed herein are based on the appraisers best judgement and opinion and are not representations or warranties that the items will realize that value if offered for sale in an appropriate market within the United States. The appraisers, without any past, present, or contemplated future interest or bias which might tend to prevent a fair and objective appraisal declare the current retail replacement value of each item. Compensation for this appraisal is not contingent upon the arrived valuation. Fee is based on an hourly rate plus expenses. No person, group, or organization was given a fee in connection with the procurement of this appraisal assignment. Further, compensation is not contingent upon the reporting of a predetermined value or direction in value that favors the cause of the client, the amount of the value estimate, the attainment of a stipulated result, or the occurrence of a subsequent event. The objective of this report is to provide an unbiased retail replacement value guideline and a basis for insurance portfolio evaluation. Photographs, when included, are for reference in the event of a claim under an insurance policy. This is a partial contents appraisal. Appraisers only appraised articles of Fine and Decorative Art and Jewelry as designated by the client. This report has been written according to the rules of the USPAP (Uniform Standard of Professional Appraisal Practice). This appraisal is considered to be a current summary appraisal report. (Continued on Page 2) 1

2 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 2 OF 34 APPRAISERS CERTIFICATION (Continued from Page 1) Although these certification pages include salient information regarding the methodology of the report, additional information regarding the scope of work, assignment conditions, and disclaimers are important to understand the entire appraisal process. As such, the entire report is required to fully understand the assignment and this certification page encompasses the entire report and is not valid without reading and understanding the entire report. Total pages of report: Total number of articles appraised: Total number of photographs: Examination SAMPLE dates: March 28 and June 1, REPORT 2008 Research dates: March 29 - August 1, 2008 Effective valuation date: June 1, 2008 Issue date of the report: August 1, 2008 APPRAISER S NAME, AAA Appraisers Association of America, Appraisers Association of America, Certified Member (Fine Art, silver, porcelain) Member (Decorative Art) GG (Jewelry) Graduate Gemmologist 2

3 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 3 OF 34 CV s for each appraiser who signs the report 3

4 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 4 OF 34 TABLE OF CONTENTS Appraisers Certification Page 1 Appraisers Qualifications Pages 2a - 2c FIRST APPRAISER S NAME, AAA Page 2 SECOND APPRAISER S NAME Page 2a THIRD APPRAISER S NAME Page 2c Table of Contents Page # Scope of Work: Appraisal Method and Definition of Value Pages # - # Explanation of Authorship and Attribution Page # Disclaimers, Limiting Conditions and Assumptions Pages # - ## Market Analysis Page ## Total Value Page ## Schedule of Fine Art Article 1 - # Pages ## - ## Sources Pages ## - ## References Books and Price Guides Page ## Galleries, Experts, Auctions, Retail Stores Page ## Internet Sites Page ## 4

5 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 5 OF 34 SCOPE OF WORK: APPRAISAL METHOD AND DEFINITION OF VALUE PROBLEM TO SOLVE: The appraisers were asked to provide a current retail replacement value for a collection of fine and decorative art for insurance purposes. With the client s approval/permission, this appraisal report will be sent to his designated insurance company. This report is not valid for any other purpose. th th CATEGORY OF ITEMS EXAMINED: Late 19 and 20 century art, craftsman and antique furniture, rugs, silver, china, and art glass. CLIENT: Owner of the artwork,. OWNER OF THE ARTWORK: The client,. OWNERSHIP INTEREST / ART LOSS REGISTER: The question of title was not an issue. Client provided the appraisers with detailed invoices for major works. The client did not feel it necessary to perform Art Loss Register inquiries for the other works. AUTHENTICITY: Although the appraisers are not authenticators, the appraisers had no reason to doubt the authenticity of the works, except as noted and appraised accordingly. EFFECTIVE DATE OF APPRAISAL: Values expressed in this appraisal are effective on the most recent examination date, June 1, USE OF APPRAISAL: Insurance. USER(S) OF APPRAISAL: This appraisal can be used and relied upon by the client and a designated insurance company / agent / broker / underwriter / adjustor. Any other user is considered an unintended user. GENERAL ASSIGNMENT CONDITIONS: The appraisers were allowed adequate time to examine, photograph, and research the articles listed herein. Appraisers were given significant documentation for some articles and no documentation for other articles. SPECIFIC ASSIGNMENT CONDITIONS (ASSUMPTIONS): The appraisers assume the mediums to be as represented. Specific mediums were not tested as they are not pertinent to the appraised value of these works. SPECIFIC ASSIGNMENT CONDITIONS (EXTRAORDINARY ASSUMPTIONS): Appraisers were provided with some primary documentation for these works. The appraisers assume this information is accurate and correct. The appraisers assume the verbal information provided by the client to be correct. Information concerning provenance or sales history on certain articles was not made available to the appraisers. Provenance may play a significant role in valuation and is not considered in this report. (Continued on Page 6) 5

6 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 6 OF 34 SCOPE OF WORK: APPRAISAL METHOD AND DEFINITION OF VALUE (Continued from Page 5) The appraisers assume the works described and pictured herein are the pieces which are the subject of this appraisal and covered under the client s insurance policy. The appraisers assume that these articles are not now nor will ever be substituted with other articles by the client in the event of a loss. The appraisers assume authorship to be authentic, including signatures to be by the named artists. Natural gemstones are processed from the time they are extracted from the earth by one or more traditionally accepted methods. Therefore, unless otherwise stated, all colored stones are presumed to have been subjected to a stable and possibly undetectable color/clarity enhancement process. Value conclusions are based on these universally practiced and accepted processes. All pearls are assumed to be cultured or farmed, unless accompanied by documentation supporting a natural origin. Marks on objects (trademarks, signatures, maker s marks, serial numbers) may affect the value of a piece. For the purpose of this appraisal, the appraisers assume that all markings are authentic, unless otherwise indicated (This is also considered a Limiting Condition). The appraisers are not authenticators. As such, in certain cases the appraisers may recommend authentication a specific marks, age, or authorship. Authentication of this nature is not the responsibility of the appraisers (This is also considered a Limiting Condition). The appraisers assume the client retains full title to works. The appraisers assume these works were previously traded in an appropriate market without any unusual market stimuli affecting its sale or transaction. SPECIFIC ASSIGNMENT CONDITIONS (LIMITING CONDITIONS): This report is limited to the information provided by the client (This is also considered an Extraordinary Assumption). The appraisers did not remove all works from the wall due to their size or location. The appraisal is limited by what appears on the recto (This is also considered an Extraordinary Assumption). Works not examined on verso will be identified as such in the individual descriptions. The appraisers did not remove any paintings or prints from their mattes and/or frames to check for signature, markings, and condition. The appraisal is limited by what appears within the mattes and/or frames (This is also considered an Extraordinary Assumption). Only when physically possible and not evasive did the appraisers examine under the upholstery for signature, markings, and conditions (when applicable). The appraisal is limited by what appears on the surface (This is also considered an Extraordinary Assumption). (Continued on Page 7) 6

7 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 7 OF 34 SCOPE OF WORK: APPRAISAL METHOD AND DEFINITION OF VALUE (Continued from Page 6) Only when physically possible, did the appraisers examine undersides and back rails of furniture for signatures and condition (when applicable) (This is also considered an Extraordinary Assumption). Only when physically possible, did the appraisers remove drawers to examine for signatures (when applicable) (This is also considered an Extraordinary Assumption). Only when physically possible, did the appraisers move heavy furniture to thoroughly examine for signatures and condition (when applicable) (This is also considered an Extraordinary Assumption). Only when physically possible, did the appraisers lift stone slabs atop furniture to examine for signatures and condition (when applicable) (This is also considered an Extraordinary Assumption). The appraisers did not examine or test the workings of clocks for accuracy and precision (when applicable) (This is also considered an Extraordinary Assumption). Chandeliers and sconces were not removed from the ceiling/wall to examine for signatures or markings (This is also considered an Extraordinary Assumption). The appraisers did not examine each globe/crystal on chandeliers/sconces/lighting fixtures for signature or condition (This is also considered an Extraordinary Assumption). The appraisers did not examine each works under mounts or protective bases if not readily removable for signature or condition (This is also considered an Extraordinary Assumption). The appraisers did not examine or test electrical works for safety and / or condition of the wiring (This is also considered an Extraordinary Assumption). The appraisers did not test any metals for the silver/gold content. The appraisers relied on the validity/authenticity of the silver/gold markings (This is also considered an Extraordinary Assumption). The appraisers did not remove any stones from their mounts. The weight, grade, color, and clarity may be limited by the in mount examination. As such, this appraisal is limited by what appears within the mount (This is also considered an Extraordinary Assumption). The appraisers may be unable to ascertain the origin of pearls due to limitations of portable equipment. As such, in some cases, expert analysis and X-ray procedures may be recommended, Determination of pearl origin is not the responsibility of the appraisers (This is also considered an Extraordinary Assumption). (Continued on Page 8) 7

8 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 8 OF 34 SCOPE OF WORK: APPRAISAL METHOD AND DEFINITION OF VALUE (Continued from Page 7) When examining diamonds and colored stones, every reasonable effort has been made to determine the existence of a fracture filling, clarity, or color enhancement process. However, no binding representation can be made in all circumstances as to the existence or nonexistence of such process. Enhancement procedures are often undetectable through the use of a standard portable laboratory. Detection of enhancements is limited by the gemological equipment used (This is also considered an Extraordinary Assumption). The appraisers are not conservators or jewelry repair technicians. As such, they did not SAMPLE prepare a condition report. This REPORT report is limited by the appraisers visual inspection. No other condition report was supplied (This is also considered an Extraordinary Assumption). When examining diamonds and colored stones, every reasonable effort has been made to determine the existence of a fracture filling, clarity, or color enhancement process. However, no binding representation can be made in all circumstances as to the existence or nonexistence of such process. Enhancement procedures are often undetectable through the use of a standard portable laboratory. Detection of enhancements is limited by the gemological equipment used (This is also considered an Extraordinary Assumption). The appraisers are not conservators or jewelry repair technicians. As such, they did not prepare a condition report. This report is limited by the appraisers visual inspection. No other condition report was supplied (This is also considered an Extraordinary Assumption). SPECIFIC ASSIGNMENT CONDITIONS (HYPOTHETICAL CONDITIONS): exist. 8 No Hypothetical Conditions EXAMINATION AND METHOD OF EXAMINATION OF FINE AND DECORATIVE ART: The appraisers examined the works in the client s home in Greenwich, Connecticut, under daylight, incandescent light, and/or a halogen flashlight. An ultra-violet light was not used as the environment was not properly conducive for such examination. When appropriate, the appraisers examined certain objects with a 5/7/20X magnification optical quality loupe. The appraisers were able to ascertain medium, style, and quality of works from personal examination, referencing photographs, supporting documentation, and personal research. The appraisers measured most works. Measurements are given to the nearest 1/8 inch; height precedes width unless otherwise stated. On certain large works, the appraisers accepted the information from the receipts, if available. Works not measured by the appraisers will be identified as such in the individual descriptions. No condition report was supplied. The appraisers assigned each piece a general condition comment - good, fair, or poor - and a qualification when appropriate. Condition refers to what is considered generally acceptable, with ordinary wear and tear for its type, unless otherwise noted. (Continued on Page 9)

9 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 9 OF 34 SCOPE OF WORK: APPRAISAL METHOD AND DEFINITION OF VALUE (Continued from Page 8) METHOD OF EXAMINATION OF JEWELRY: APPRAISER S NAME, AAA, briefly examined the items in the client s home in Greenwich, Connecticut, under daylight while photographing the collection. The gemmologist, , more thoroughly examined and evaluated the items in this appraisal by using the accepted standards of the jewelry industry and those of the Gemmological Institute of America. Data was collected on site and in accordance with those standards by using careful observation and professional equipment. Items were examined through one or more of the following devices/equipment: a portable Gemmological laboratory, an American Optical 570 Binocular SAMPLE Microscope with 10x-63x magnification, REPORT 10x loupe, a fiberoptic probe illuminator (with monochromatic filter), long and short wave ultraviolet (UV) fluorescence, Rayner Refractometer, dichroscope, spectroscope, electronic scales, leveridge gauge, G.I.A. Gem Set, Gem Dialogue Color Comparison, Diamond Grading Light Source, G.I.A. diamond master comparison stones, and a metal testing kit. The quality grade of any gemstone is restricted by various types of mountings, settings, and lighting conditions. This quality grade of any gem may differ if it is removed from a mounting and/or examined under a different light source. However, in order to standardize the examination environment, the jewelry industry has prescribed the use of special lighting. The prescribed light sources were used in this examination. This includes both a diamondlite (north daylight equivalent) and a fiber optic probe (monochromatic light source). Additionally, when appropriate, long/short wave (UV) fluorescence was used to aid in the authentication of diamonds and colored stones. Metal quality of finished jewelry cannot be conclusively established by the gemologist appraiser. Common industry practice suggests that metals be identified by acid testing, test needles and rub stones as well as confirming the authenticity of identification marks. The designer and/or manufacturer of a given piece of jewelry may be identified by extensive research and the authentication of trademarks, hallmarks, and maker s marks. The gemologist appraiser was able to ascertain material, style, size, and quality of workmanship from his personal examination, referencing photographs, and personal research. Each work has been measured. All measurements are approximate. Measurements are given to the nearest mm/gram. Unless otherwise stated, the weights of all mounted gemstones are estimated by using accepted gemological formulas, and should be within the accepted limitations of that method. Although state-of-theart gemological equipment is used, the actual weight of gemstones when unmounted may be different from the estimated wight by formula (This is also considered an Extraordinary Assumptions and Limiting Condition). No jewelry condition report was supplied. The gemmologist appraiser assigned each piece a general condition comment - good, fair, or poor - and a qualification when appropriate. Condition refers to what is considered generally acceptable, with ordinary wear and tear for its type, unless otherwise noted. (Continued on Page 10) 9

10 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 10 OF 34 SCOPE OF WORK: APPRAISAL METHOD AND DEFINITION OF VALUE (Continued from Page 9) PHOTOGRAPHY: APPRAISER S NAME, AAA took 35mm photographs of the works. No modifications or alterations were made to the appraisers photographs. METHOD OF RESEARCH: Research was conducted in the offices of COMPANY NAME. The office is equipped with an extensive library of more than 10,000 research books and auction catalogues. Additional research was conducted on the internet using standard search engines as well as pricing data bases to which COMPANY NAME subscribes (including ArtNet, ArtFact, ArtPrice, Prices for Antiques, AskArt, Gordonsart, Invaluable, and Antiqueclockspriceguide). Appropriate galleries and auction houses were contacted for information when necessary. Minimal outside library/museum research was conducted for this specific appraisal. sources and internet sites are listed at the end of the report. Specific TYPE OF APPRAISAL: This report is considered to be a current summary appraisal report according to the rules of USPAP (Uniform Standard of Professional Appraisal Practice). Comparable sales history is not included in the report. However comparable sale information is kept in the client s file in the offices of COMPANY NAME and is available for the client or the insurance company (with the client s permission) to examine upon request. This information will be kept by COMPANY NAME for a minimal period of five (5) years after the date of issue or two (2) years after final disposition of any judicial proceedings involving the appraisers, whichever period expires last. APPROACH TO VALUE: The appraisers named on the cover page of this document has employed the "market comparison" approach to arrive at the appraised "retail replacement value". The "income" approach and the "cost" approach are not applicable to this particular appraisal. MARKET EXAMINED: The "market comparison" approach analyzes recent sales of comparable articles at major international and regional fine art auctions, private and public sales, shows and exhibitions, as well as prevailing prices at retail shops and galleries where the article may normally be traded. For this particular appraisal, the appraisers primarily examined the international fine art gallery and auction markets. Adjustments are then made for each article which consider age, condition, rarity, artistic merit, technical workmanship, current trends and availability of an article as compared to such recent sales. TYPE OF VALUE USED: Retail replacement value. DEFINITION OF VALUE: Appraised "retail replacement value" is defined as the highest amount in terms of US dollars that would be required to replace a property with another of similar age, quality, origin, appearance, provenance, and condition within a reasonable length of time in an appropriate and relevant market. When applicable, sales and/or import tax, commissions and/or premiums are included in this amount. (Continued on Page 11) 10

11 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 11 OF 34 SCOPE OF WORK: APPRAISAL METHOD AND DEFINITION OF VALUE (Continued from Page 10) SOURCE FOR DEFINITION OF RETAIL REPLACEMENT VALUE: Studies Program, Fall New York University Appraisal USPAP COMPLIANCY: The report was written by APPRAISER S NAME, AAA whose USPAP qualification with the AAA is valid until This appraisal report follows the guidelines of USPAP in that the report provides all of the necessary information/analysis to satisfy the current report development requirements as defined in Standard 7 (Personal Property, Development) and the writing requirements of a Summary Appraisal as defined in Standard SAMPLE 8 (Personal Property, Reporting). REPORT 11

12 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 12 OF 34 EXPLANATION OF SILVER, GOLD, SILVER FINE ART BREAKABLE (SFAB), AND SILVER FLATWARE Silver - Only articles marked with a sterling standard (925/1000 or greater), the word sterling, or have been scientifically proven to be sterling, will be described as sterling silver. Articles with some other silver standard (Continental - 800/1000 or greater, coin, seven metal), or have proven to be silver of a certain standard, will be identified accordingly. Gold - Only articles marked 10K, 14K, 18K, 24K, or have been scientifically proven to be gold, will be described and identified accordingly as gold. All weights have been determined by use of Troy or pennyweight scales. Current spot silver and gold prices on the New York market are a factor in the determination of appraised value of contemporary silver. Adjustments are then made for each article after considering age, condition, rarity, artistic merit, technical workmanship, current trends, and availability of an article. Gold items with a fine art, antique, or rare value are indicated in the report as "(GOLD)". This indication is directly under the article number. (SFAB) - Silver or gold items with breakable parts are known as Silver Fine Art Breakables and are indicated in the report as "(SFAB)". This indication is directly under the article number. Antique silver - Items of antique silver, silverplate, and gold are included in the Schedule of Fine Art rather than in a Schedule of Contemporary Silver, Silverplate, and Gold. Antique silver, silverplate, and gold items include such items of rare and handmade nature. These items are not usually readily available on the primary market. Flatware qualifications - Values used in flatware appraisals are based on rarity of pattern and collectibility of the item. Certain patterns increase in value after they have been discontinued because of their rarity, however others may decrease, depending st on current styles and tastes. Certain articles have become obsolete in the 21 century (i.e., sardine forks, ice cream forks), however, are highly collectible due to their limited production and quirky functions. As such, these pieces have a great collectable value over standard pieces. The following explains the availability of manufactured silver: Active pattern: market. Active pattern readily available and easily obtainable on the retail Inactive/discontinued pattern: produced with a special order. Pattern not currently in production, however can be Obsolete pattern: Pattern which is no longer available from the manufacturer, the dies have been destroyed, or the manufacturer no longer in business. Closed pattern: Limited edition pattern and is no longer available. Unknown pattern: Appraisers unable to ascertain availability of pattern; owner of dies unknown. 12

13 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 13 OF 34 EXPLANATION OF FINE JEWELRY DEFINITION OF TERMS DIAMONDS AND COLORED STONES All articles of fine jewelry with major stones are examined by a Graduate Gemmologist and will be described and identified accordingly. Articles of vintage and/or collectible jewelry are examined by an antiques appraiser and valued as antiques rather than their value in materials. Diamond and colored stones are valued based on the following criteria when significant: CARAT Carat is the measure of weight, not the size of the stone. It is a small unit of The word "carat" is derived from carob, the tree whose seeds became the standard for measuring diamonds. A 1 carat diamond is made up of 100 units called "points". Therefore, a 50 point diamond is a ½ carat or.50 carat. ( Carat in reference to the weight of a stone should not be confused with "karat" in reference to gold.) measure equal to 200 milligrams. COLOR Diamonds are assigned a color grade based upon the amount of body color exhibited when compared to a set of Master Color Diamonds which have been color-graded and registered by the GIA Gem Trade Laboratory. In most cases, diamonds are graded using a standardized light source equivalent to daylight. The color grading scale is as follows: D E F G H I J K L M N O P Q R S T U V X Y Z Z+ COLORLESS NEAR FAINT VERY LIGHT YELLOW LIGHT YELLOW FANCY COLORLESS YELLOW YELLOW CLARITY Clarity is an indication of a diamond's purity. Clarity is determined by the overall number, size, and location of inclusions (flaws). The U.S. Federal Trade Commission established the jewelry industry's standards for diamond clarity based on 10-power magnification. As such, the appraiser assigned diamonds a clarity grade based upon examination under a 10x binocular microscope equipped with dark field illumination. The clarity grading scale is as follows: FLAWLESS I.F. VVS¹¹ VVS² VS¹ VS² SI¹ SI² I¹ I² I³ INTERNALLY FLAWLESS VERY VERY SLIGHTLY INCLUDED VERY SLIGHTLY INCLUDED SLIGHTLY INCLUDED IMPERFECT EYE VISIBLE INCLUSIONS CUT Cut refers both to the shape of a diamond and the precise arrangement of its facets. The most popular cuts are Round (AKA Brilliant), Pear, Marquise, Emerald, Oval, Princess, and Heart. (Continued on Page 14) 13

14 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 14 OF 34 EXPLANATION OF FINE JEWELRY - DEFINITION OF TERMS (Continued from Page 13) PEARLS All articles of fine jewelry with pearls are examined by a Graduate Gemmologist and will be described and identified accordingly. Articles of vintage and/or collectible jewelry are examined by an antiques appraiser and valued as antiques rather than their value in materials. Pearls are valued based on the following criteria when significant: SHAPE Round - well-matched, globular (most valuable) Half-round - flat bottoms Baroque - irregular Fresh water - irregular BODY COLOR There are six main body colors found in pearls: white, cream, pink, golden, black, and green. Pearls are also found in blended color variations such as lavender, silver, and gray. Pearls are ideally graded in natural daylight using a white background. If natural light is unavailable, fluorescent light is the next best lighting. Color evaluation of pearls is controversial as a value factor. While color is significant, it is not granted over-importance in the final estimation of value. The evaluation of color is more difficult and rather subjective, as there are subtleties of market preference based on attitudes of specific clients and regional preferences. LUSTER Pearls are rated according to the fineness of their luster. Luster is determined by the intensity of the reflection found on the surface of a pearl which results from light striking the surface. Luster is seen on a smooth surface where no ridges are present to reflect the light in many directions. The more mirrorlike the surface reflection of a pearl, the better the quality. In evaluating pearls, the appraiser assigned a luster rating of very good, good, and fair. MATCH Match is an indication of continuity and quality in a strand of pearls. In a wellmatched strand, the pearls are similar in shape and give the viewer the overall impression of evenness. A well-matched strand is given a higher value consideration than one of mixed shapes. In evaluating a stand of pearls, the appraiser assigned a match rating of very good, good, and fair. BLEMISHES Blemishes, or spotting, are the wrinkles, cracks, gaps, bumps, or dull spots on the surface skin of pearls. The most important criterion for assessing the value of a pearl is the perfection of the skin, i.e., the lack of blemishes. As such, the appraiser has indicated any apparent blemishes. 14

15 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 15 OF 34 EXPLANATION OF FINE ART BREAKABLE (FAB) AND BREAKABLE PERSONAL PROPERTY (BPP) Fine Art Breakable and Breakable Personal Property items are indicated in the report as "(FAB)" or "(BPP)" directly under the article number. Fine Art Breakable (FAB) items include all items of glass, pottery, china, terra cotta, and marble that have a fine art, antique, or collectible nature. Breakable Personal Property (BPP) items include all items of glass, pottery, china, terra cotta, and marble residential contents that do not have a fine art, antique, or collectible nature. Mirrors are included as Fine Art Breakable (FAB) items if the plate is of equal or more value than the frame or if a replaced plate would affect the total value of the piece. Vintage wine is not considered a Fine Art Breakable (FAB) unless otherwise indicated. Wine will normally be considered as a Breakable Personal Property (BPP) item except in the case of antique wine. 15

16 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 16 OF 34 GLOSSARY A George III mahogany linen press Late 18th century EXPLANATION OF AUTHORSHIP AND ATTRIBUTION This heading and date indicate that in the appraisers qualified opinion the piece is essentially of the period. Later restorations and alterations are indicated and considered in the valuation. A George III-style mahogany linen press 19th century The heading and date with the word "style" included indicates that in the appraisers qualified opinion the piece is an intentional copy of an earlier design. Later restorations and alterations are indicated and considered in the valuation. FURNITURE PERIODS AND STYLES Dates British Monarch U.K. Period French Period Commonwealth Cromwellian Louis XIV ( ) Charles II Restoration James II Restoration William & Mary William & Mary William III William III Anne Queen Anne George I Early Georgian Regence ( ) George II Early Georgian Louis XV ( ) George III Late Georgian Louis XVI ( ) Directoire ( ) Empire ( ) George IV Regency Restauration ( ) Victoria Victorian Louis Phillippe 2 Empire ( ) rd 3 Republic ( ) Edward VII Edwardian Art Nouveau ( ) nd SIGNATURE When a work is signed/dated/inscribed by the hand of the artist/craftsman, the appraiser will state "Signed/stamped/incised..." exactly as written by the particular artist/craftsman in the specific composition. This means that the appraiser believes the work to be by the "signed" artist/craftsman. When a signature/stamp/seal exists on a work, but the work does not appear to be by the hand of such signed artist, the appraiser will indicate that the work "Bears signature/stamp of...". This means that the appraiser does not believe the work to be by the "signed" artist/craftsman. (Continued on Page 17) 16

17 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 17 OF 34 EXPLANATION OF AUTHORSHIP AND ATTRIBUTION (Continued from Page 16) AUTHORSHIP GLOSSARY TITLE - If a generally accepted title for the work exists, that title is given. If the work is untitled or the title is unknown, a descriptive title may be assigned and is indicated with an asterisk (*). When provenance is unknown and a search of reliable sources fails to render information concerning a particular artist or work involved, a value determination is based on artistic merit and market conditions. AUTHORSHIP - When a work is unsigned but generally accepted in the scholarly community to be by SAMPLE a particular artist, that artist's name REPORT will be indicated as "Ascribed to...". This is the highest category of authenticity. When a question of doubt concerning authorship prevails, the authorship will be indicated as "Attributed to..." a particular artist or a school. When a signature exists on a work, but the work does not appear to be by the hand of such signed artists, the appraiser will indicate that the work "Bears signature of...". This means that the appraiser does not believe the work to be by the "signed" artist. 17

18 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 18 OF 34 GLOSSARY OF TERMS APPLICABLE TO THIS REPORT abstraction - art which makes no direct, immediate discernible reference to recognizable objects. In abstract art, the formal arrangement of colors and forms is independent of, and more important than, the subject matter. buyer's premium - a percentage of the bid ("hammer") price at an auction; usually 5-20%. canvas size - the actual size of a work on canvas where the edges are visible. catalogue raisonné - a scholarly catalogue which should include all the known works SAMPLE by an artist at the time of compilation; REPORT includes essential information by which works are identified; the definitive reference book. cradled panel - a restoration method used to support the back of a wood panel; usually constructed in a series of horizontal and vertical wood pieces and applied to the back of an old panel; keeps wood from serious warping, allowing for natural expansion and contraction. craquelure - the result of the uneven movements of the canvas caused by the natural shrinking of the medium on aging; usually appears on the surface in a "spider-web" like series of cracks. Surface can be stabilized by relining the canvas and restoring the cracks. estimate (est.) - the pre sale dollar amount suggested by an auction house at which an object is expected to fetch at auction expressionistic - a style of art characterized by distortions of line, shape, and color based on an emotional reaction of the artist gouache - an opaque watercolor. The effects achieved are closer to those of oil paint than watercolor. A disadvantage of gouache is that it lightens as it dries hammer price - the actual "bid" price at an auction; does not include the premium impasto - paint applied with the consistency of thick paste impressionistic - a style of art characterized by discontinuous brushwork or an analytical approach to light on an object where strokes of color blend in the eye to form the object o/c - oil on canvas patinated - a finish often applied to bronzes to add color; usually in green, brown, black, or gold reserve - the agreed upon minimal amount at which an item can be sold at auction (Continued on Page 19) 18

19 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 19 OF 34 GLOSSARY OF TERMS (Continued from Page 18) seller's premium - a percentage of the bid ("hammer") price at an auction; usually 5-15%. It is usually more negotiable than the buyer's premium. surmoulage - a cast from a cast TAM - Tax Advisory Memorandum terra cotta - a medium used in creating sculptures. It is fired clay, modeled or moulded, and baked until it is very hard. Terra cotta has been used since ancient times for pottery and sculpture, and as a building material. It may be coated with a glaze of molten glass, painted, or left untreated. watermark - design left in the paper by the paper manufacturer; seen when held against the light; used to trace the origin of the paper; special markings for an artist or publisher may incorporate a signature or a device; can be used to detect fakes -- although it can be faked. w/c - watercolor work size - the actual size of a work on board or paper where the edges are visible work size (sight) - the visual size of a work on board, paper, or canvas, usually measured in a frame and not knowing the extend of the margins/edges under the frame unsold - an artwork that did not sell at auction. The most common reason items are unsold is because the item failed to reach its reserve (AKA buy-in or bought-in ). Other reasons an item is unsold could be that the item was withdrawn based on ownership or authenticity, or that the consigner changed their minds. 19

20 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 20 OF 34 DISCLAIMERS, LIMITING CONDITIONS AND ASSUMPTIONS This certificate of appraisal is given, subject to the terms and conditions hereinafter set forth, all of which are a part hereof unless expressly set aside in writing either on the pages of this certificate or by writing attached to the certificate signed by all parties concerned. This appraisal consists of XX pages and must be presented in its entirety to be valid. This appraisal is prepared solely for insurance purposes using the comparative market approach to arrive at the retail replacement values as of June 1, It is SAMPLE to be used by Dr. Diane Pill and Mr. REPORT Justin Case and solely by them for insurance purposes. This report can be used by an insurance company / agent / broker / underwriter / adjustor as designated by Dr. Pill and Mr. Case. The client shall indemnify, defend, and hold us harmless from and against any actions, claims, liabilities or expenses incurred as a result of claims based on or arising from the appraisal, by third parties unrelated to the immediate purpose of this appraisal. Unless otherwise stated herein, this certificate is based only on the readily apparent identity of the items appraised, and no further opinion nor guarantee of authenticity, genuineness, attribution, or authorship is made. However, in appraising the subject articles, the appraisers found no reason to question the authenticity of the articles (See also Scope of Work). Some descriptive information pertaining to the work was supplied by the client, through standard reference material, and the internet. No reported scientific and/or laboratory testing has been performed on any articles. The appraised value is based on the whole ownership and possessory interest undiminished by any liens, fractional interests or any other form of encumbrance or alienation. This certificate is made at the request of the party named for their use. It is not an indication or certificate of title ownership. The identification of the interest of the requesting party is simply that represented to the appraisers by such party and no inquiry or investigation has been made nor is any opinion given as to the truth of such representation. The values expressed herein is based on the appraisers best judgment and opinion and are not representations or warranties that the items will realize these values if offered for sale at an auction or otherwise. The values expressed are based on current information on the assigned effective date stated on the cover page of this report. No opinion is hereby expressed as to any future value, nor unless otherwise stated, as to any past value. (Continued on Page 21) 20

21 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 21 OF 34 DISCLAIMERS, LIMITING CONDITIONS AND ASSUMPTIONS (Continued from Page 20) The appraisers considered the highest and best use of the appraised articles with respect to the most appropriate, common, and legal marketplace given the purpose of the appraisal. The appraisers have no past interest, no present interest, nor any contemplated future financial interest in the appraised property. The appraisers do not have any personal interest or bias with respect to the parties involved. This appraisal was done objectively and in accordance with the Uniform Standards of Professional Appraisal Practice and the Appraisers Association of America. Further, the appraisers SAMPLE have no other interest which REPORT might tend to prevent making a fair and unbiased appraisal. This appraisal was researched and prepared by the appraisers named on the cover page of this report. Supplemental research was supplied by office assistants and interns at APPRAISAL COMPANY NAME, particularly and No other person supplied significant assistance in preparation of this report. Some information regarding provenance was limited to hearsay. Minimal primary information regarding exhibition and literary history of the articles were made available by the client to the appraisers. Any factual and/or hearsay information provided by the client is assumed to be correct, however, the appraisers are not responsible for any errors or misrepresentations on the part of Dr. Pill or Mr. Case. The appraisers did not personally examine any of the comparable sales and/or offerings with regard to these particular works. The appraisers are relying on information made available through price databases and gallery inventories regarding authenticity, condition, and sales information concerning these works. Consulting sources are listed in the back of the report. Information furnished by consulting sources is assumed to be reliable, but is not guaranteed by these appraisers or their firm. The appraisers are not required to give testimony, be present in any court of law, or appear before any commission or board by reason of this appraisal, unless prior arrangements have been made with the appraisers. Should this report be challenged in anyway, not limited to litigation, it is understood that the appraisers are prepared to defend their appraisal, if required. Courtroom testimony, mediation proceedings, and the necessary preparation are considered to be separate assignments and will be billed at our then current normal hourly rate plus expenses as required. Possession of this report, or copy thereof, does not include the right of publication without the written consent of the appraisers and their firm. This report in its entirety, or any part thereof, including the identity of the appraisers or their firm, shall not be made public through advertising, public relations, news releases, sales, or other distributive or information media without the written consent of the appraisers and their firm. (Continued on Page 22) 21

22 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 22 OF 34 DISCLAIMERS, LIMITING CONDITIONS AND ASSUMPTIONS (Continued from Page 21) Copies of this appraisal and notes pertaining to the appraisal, written and electronic, will be kept in the offices of COMPANY NAME for a minimal period of five (5) years after the date of issue or two (2) years after final disposition of any judicial proceedings involving the appraisers, whichever period expires last. APPRAISAL COMPANY NAME will make every effort to store client records in a safe and secure environment. However the firm is not responsible for acts of war, terrorism, or other such unexpected catastrophes which may affect the safekeeping of this report. All matters SAMPLE treating the duties, responsibilities, REPORT and liabilities of the appraisers are in accord with the Valuation Standards and Professional Practices as outlined by the Appraisal Foundation in the Uniform Standards of Professional Appraisal Practice and the Principles of Practice and the Code of Ethics of the Appraisers Association of America APPRAISAL COMPANY NAME. All Rights Reserved. None of the contents of this appraisal report may be reproduced, stored in a retrieval system or transmitted in any form or by any mean (electronic, mechanic, photocopying, recording or otherwise) without the prior written permission of APPRAISAL COMPANY NAME and the appraisers' signature. 22

23 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 23 OF 34 MARKET ANALYSIS Given that the art and antique markets are always volatile markets, an overall market valuation forecast cannot be established. Particularly with the uncertain political and economic situation of the world after September 11, 2001, a market analysis is difficult to prepare in these uncertain times. However, based on an analysis of the market since 2000 and a presumption of a future relatively stable growth, it could be concluded that certain areas have and will appreciate at a greater rate than others. Until this year, American art has been one of the areas that has been doing quite well on the primary and secondary markets. However, SAMPLE given the current state of the American REPORT economy, we have been currently experiencing a dip in the market. This is felt throughout the art market, however, the American market is hit the hardest as most patrons are Americans and cannot look to the global market for buyers as relied upon by the Modern and Contemporary markets. ArtPrice has compiled indicators for the auction sales of Benton. According to Figure 1, works by Benton appear to be on a decline. However, because of a weakened economy, collectors are reluctant to sell their works in this market. Hence no fabulous works have appeared to teeter the trend. According to this chart, works by Benton are down by 57%. Speaking with galleries, such as Hirschl and Adler or Spanierman, Figure 1 - TH Benton Activity they dispute this data, saying that there is good art available, but one must search for it in this uncertain economy. Internationally, it has been a different story. The Impressionist and Modern Art Evening Sale of June 24, 2008 at Christie s generated 144 million ($284 million), the largest sales volume ever posted by a European auction. The following day, Sotheby's took 102 million, exceeding its aggregate high estimates by seven million. In New York, during the May sales, Christie s and Sotheby s achieved proceeds of $1.2 billion. Works by Monet, Bacon, and Freud sold in the past few months have been snapped up as trophy purchases by Tania Buckrell Pos or the Russian billionaire Roman Abramovich, serving as barometers for the whole market, as did the works of Renoir and Van Gogh during the 1990 speculative bubble. Once again, the high-profile Christie s and Sotheby s sales, which represent just 1/1000 of global transactions seem to be setting the tone for the broader market. The following chart represents activity in French Impressionism relating to your Monet, Renoir, Fantin Latour, and Maillol. Note that we are at the levels of the height of the market in (Continued on Page 24) 23

24 2008 RETAIL REPLACEMENT VALUE INSURANCE SUMMARY APPRAISAL REPORT PAGE 24 OF 34 M ARKET ANALYSIS (Continued from Page 23) That said, the confidence indicator for players in the art market has been falling for over a month. Having peaked at +31 points at the end of May following the excellent results from the May New York sales, this indicator has gradually turned down haunted by the ghost of an unprecedented global economic recession. With oil prices surpassing $140/bbl, the cost of the subprime crisis continues to rise, real estate values have dropped practically everywhere in the world, the financial markets continue their relentless correction, inflation is becoming galloping, growth forecasts are looking increasingly pessimistic Yet for all that, the art market is still showing signs of resistance, defying the other poorer performing sectors of the global economy. In such an environment, the million-pound proceeds recorded in the highly prestigious Christie's and Sotheby's London sales look nothing short of miraculous. 1 Aside form the artwork, much of your furniture is finely made custom furniture or craft items, which commands high prices in the primary market due to its craftsmanship and uniqueness. These pieces rarely retain their value on the secondary market, particularly in one s lifetime. However, these works will undoubtedly be appreciated in the generations to come. Given your specific collection and based on general and specific market volatilities, these appraisers recommend that a general appraisal update should be conducted in at least two years to adequately protect yourself for insurance purposes. Please note that the appraisers do not guarantee any prices or predictions for values in the future