AppHarvest is facing a foreclosure action against its 60-acre farm on Speedwell Road here in Richmond. That’s according to a report by the Commonwealth Journal. Citing a court filing in Madison Circuit Court, AppHarvest risks losing one of its largest greenhouse facilities to foreclosure if it doesn’t reach a resolution with a creditor demanding over $66 million. The creditor is demanding immediate repayment of what remains of the loan plus interest — about $66.7 million — or the Richmond farm would be taken as collateral.
According to the Journal, the creditor filed a foreclosure complaint on the facility in Madison Circuit Court on May 30. AppHarvest has 20 days to respond in court or face a default judgment. The filing alleges that AppHarvest breached its obligations to the lender by failing to complete the Richmond facility on time and on budget, among other allegations. The lender also cited a mechanics lien filed by the general construction contractor on the Richmond greenhouse, Dalsem Greenhouse Technology B.V., to secure $14.5 million the contractor claims it’s owed.
Travis Parman, AppHarvest’s Chief Communications Officer, in a statement said “We believe that we are in full compliance with the loan terms, we are working to resolve the issue directly with Equilibrium (the creditor), which we believe is based on their misunderstanding of the facts.”
A default on the loan for the Richmond facility could lead to the commencement of foreclosure proceedings on the company’s other 60-acre tomato growing facility in Morehead — the company’s oldest and most productive facility. The alleged default and foreclosure proceedings on the Richmond facility come less than a year after AppHarvest said in public filings that it was running low on cash and disclosed “substantial doubt” about its future.
Very concerning developments for that company and Madison County.
