On July 24, AppHarvest announced a Chapter 11 filing to support a financial and operational transition. This means they are seeking legal protection to restructure their finances and operations.
Business operations will continue at the farms. The company announced to have secured approximately $30 million debtor-in-possession financing commitment from Equilibrium to support ongoing operations at AppHarvest Morehead, AppHarvest Richmond, and AppHarvest Somerset during proceedings. The DIP financing is subject to the approval of the Court.
AppHarvest is pursuing a transition of its AppHarvest Berea operations to AppHarvest's distribution partner, Mastronardi Produce, or one of its affiliates, in exchange for approximately $3.75 million, additional incremental funding and support for the company's restructuring plan. This transition is subject to the approval of the Court.
AppHarvest is struggling as their landlord, Mastronardi, is trying to terminate the lease of their Berea facility, claiming the company didn't achieve minimum production volumes, which they say is considered a contract violation. Now AppHarvest announced to pursue a transition of its AppHarvest Berea operations to AppHarvest's distribution partner, Mastronardi Produce, or one of its affiliates, in exchange for approximately $3.75 million, additional incremental funding and support for the company's restructuring plan.
AppHarvest says it is diligently working to restructure the operations at the company in an effort to maximize the value creditors can expect to achieve and to preserve jobs. "The AppHarvest board of directors and executive leadership evaluated several strategic alternatives to maximize value for all stakeholders prior to the Chapter 11 filing," said recently appointed AppHarvest CEO Tony Martin. "The Chapter 11 filing provides protection while we work to transition operation of our strategic plan, Project New Leaf, which has shown strong progress toward operational efficiencies resulting in higher sales, cost savings, and product quality."
More information is available at https://cases.stretto.com/appharvest.
For more information:
AppHarvest
www.appharvest.com
