AppHarvest files for Chapter 11 bankruptcy

AppHarvest announced that it is pursuing a financial and operational transition to enable the company to reduce its outstanding liabilities. Business operations will continue at the farms, including shipping product to top national grocery store chains, restaurants and food service outlets. To pursue its transition, AppHarvest has filed voluntary petitions for protection under Chapter 11 of the U.S. Bankruptcy Code in the U.S. Bankruptcy Court for the Southern District of Texas. The company has also obtained a commitment from Equilibrium, the company’s largest secured creditor, to provide approximately $30M of debtor-in-possession financing to provide the necessary liquidity to support operations at the AppHarvest Morehead, AppHarvest Richmond and AppHarvest Somerset farms during the Chapter 11 process. The DIP financing is subject to 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 $3.75M, additional incremental funding and support for the company’s restructuring plan. This transition is subject to approval of the Court. AppHarvest 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.