AppHarvest: Asset Sales and Liquidating Chapter 11

AppHarvest Products, LLC and several affiliated entities filed chapter 11 petitions on July 23, 2023, in the U.S. Bankruptcy Court for the Southern District of Texas. The Kentucky-based controlled-environment agriculture company entered bankruptcy with a restructuring support agreement already in place and a liquidation plan designed to sell its greenhouse facilities through a court-supervised auction process. The case moved from petition to plan confirmation in under 60 days, with Judge David R. Jones confirming the amended joint plan of liquidation on September 14, 2023.

The filing followed a liquidity crisis that management attributed to lower-than-expected crop yields, higher-than-expected operating costs, declining equity markets, and mounting pressure from secured creditors. AppHarvest had operated four CEA facilities across Kentucky — in Morehead, Richmond, Somerset, and Pulaski — producing tomatoes, leafy greens, cucumbers, and strawberries. The company also held roughly 200 acres of largely undeveloped land in Morehead. By the petition date, the debtors carried approximately $190 million in funded debt across three secured facilities and nearly $30 million in trade obligations.

Debtor(s)	AppHarvest Products, LLC (7 jointly administered entities)
Court	U.S. Bankruptcy Court, Southern District of Texas (Houston Division)
Case Number	23-90745
Petition Date	July 23, 2023
Confirmation Date	September 14, 2023
Judge	Hon. David R. Jones
DIP Facility	~$29.6 million from CEFF II AppHarvest Holdings, LLC (~$24.3 million new money; $8 million interim draw)

Company Background and Causes of Distress

AppHarvest described itself as a sustainable food company founded in 2018 that developed and operated high-tech indoor farming facilities in Appalachia. The corrected first-day declaration identifies four CEA facilities — Morehead, Richmond, Pulaski, and Somerset — along with roughly 200 acres of undeveloped land in Morehead.

The company traded publicly on Nasdaq under the ticker APPH after completing a SPAC merger in early 2021. By late 2022, AppHarvest disclosed substantial doubt about its future, citing financial pressures that had been building for months.

Liquidity crisis. Management attributed the chapter 11 filing to a sequence of events that intensified in late 2022: lower-than-expected crop yields, higher-than-expected costs, tighter equity markets, and declining share prices. The declaration also points to payment-default notices from Equilibrium and Rabo AgriFinance and disputes connected to arrangements with Mastronardi Produce at the Berea greenhouse facility.

RSA framework. AppHarvest, Mastronardi Produce, Mastronardi Berea, and CEFF II AppHarvest Holdings (Equilibrium) entered into a restructuring support agreement on July 24, 2023, one day after the petition date. The RSA established milestones for the sale process and plan confirmation: file bidding procedures within 3 days of the petition date, obtain a bidding-procedures order within 21 days, obtain a sale order within 45 days, and confirm a plan within 60 days. As part of the RSA, Mastronardi Berea entered into a settlement agreement to acquire certain assets and liabilities associated with the Berea facility.

Capital Structure and DIP Financing

As of the petition date, the corrected first-day declaration reported approximately $160 million in secured debt across three facilities:

• ~$45.9 million outstanding under the Rabo AgriFinance facility
• ~$64.3 million outstanding under the Equilibrium facility
• ~$50.0 million outstanding under the Greater Nevada Credit Union facility

The debtors also carried approximately $29.7 million in trade and related unsecured debt.

DIP facility. The DIP motion states that CEFF II AppHarvest Holdings, the debtors' largest funded-debt holder, agreed to provide an approximately $29.6 million DIP facility that included roughly $24.3 million of new-money liquidity. The proposed structure provided an initial $8 million interim advance, followed by a $4 million second advance and the remaining new-money availability after entry of a final order.

The DIP matured on the earliest of 75 days after the petition date, the plan effective date, or a termination notice. The facility granted the DIP lender superpriority claims and first-priority liens, including a Greater Nevada Credit Union priming cap of $9.9 million. An interim DIP order was entered on July 26, 2023.

Sale Process and Asset Dispositions

The bidding-procedures motion describes a prepetition marketing effort conducted with Jefferies LLC as investment banker. Jefferies contacted 84 potential purchasers, including 65 financial buyers and 19 strategic buyers. The sale package separated the assets into three buckets: Richmond/Morehead, Somerset, and other assets.

Richmond and Morehead. Equilibrium served as the stalking-horse purchaser for the Richmond and Morehead facilities with a purchase price of $113,179,726, structured as a credit bid of prepetition debt. The court approved the bidding procedures on August 25, 2023, and later entered a sale order approving the Richmond/Morehead transaction. The sale order found that the purchaser acted in good faith and that any existing liens would attach to proceeds in the same order of priority. Under a related agreement, an affiliate of Mastronardi Produce would lease the Richmond and Morehead facilities from Equilibrium if Equilibrium prevailed as the successful bidder.

Somerset. The court separately approved the sale of the Somerset facility. The Somerset sale order identifies Bosch Berries Kentucky Operations Corp. as the successful bidder and authorizes assumption and assignment of designated executory contracts and leases.

Berea. As part of the RSA settlement, Mastronardi Berea acquired certain assets and liabilities associated with the Berea greenhouse facility. The court approved the Berea transfer as part of the first-day relief on July 26, 2023.

Plan Confirmation and Creditor Treatment

The debtors filed an initial joint plan of liquidation at the start of the case. After amendments, the court confirmed the second amended joint plan of liquidation on September 14, 2023, roughly 54 days after the petition date.

The confirmation order states that Classes 1 and 2 were unimpaired and conclusively presumed to accept the plan, Classes 3 through 5 voted to accept, and Classes 6 through 11 were impaired and deemed to reject.

General unsecured creditors. The second amended plan earmarked a $750,000 DIP carveout for holders of allowed Class 6 and Class 7 claims, subject to prior satisfaction of priority and tax claims.

Administrative deadlines. The plan set an administrative-claims bar date of 30 days after the effective date and a claims-objection deadline of 365 days after the effective date, absent extension.

Post-confirmation governance. The confirmation order provides that, as of the effective date, the debtors' existing directors and officers resigned, and the estates transitioned to a plan-administrator structure. The plan's releases, settlements, and exculpation provisions were approved as part of the compromise embodied in the plan. The plan became effective on December 5, 2023.

Professional Fees and Estate Administration

Final fee applications filed in the case reflect the professional spend through confirmation:

• Sidley Austin LLP (co-counsel): requested $3,568,708 in fees and $57,792 in expenses
• Triple P RTS, LLC / Portage Point (financial advisor): requested $1,106,474 in fees and $7,498 in expenses
• Jefferies LLC (investment banker): requested $4,084,244 in fees and $34,478 in expenses, including M&A transaction fees tied to the Richmond/Morehead and Somerset sales
• Jackson Walker LLP (co-counsel and conflicts counsel): requested $192,058 in fees and $2,524 in expenses

Post-Effective Wind-Down

The case remains open in a post-effective wind-down phase under the Plan Administrator. As of late 2025, the Plan Administrator was still reconciling a large claims register and preserving estate causes of action.

The third motion to extend the claims-objection bar date states that more than 250 proofs of claim had been filed and at least 265 claims had been scheduled. Remaining preference-related issues could affect claims resolution. The motion requests a new claims-objection bar date of June 29, 2026.

CEA Industry Context

AppHarvest's chapter 11 filing was one of several CEA sector bankruptcies during 2023. AeroFarms also filed for chapter 11 in 2023, and other ventures including Bowery Farming and Kalera scaled back or exited major markets. Industry observers have noted that investors including SoftBank, Walmart, and Jeff Bezos lost approximately $2.7 billion across the bankruptcies of Plenty, AppHarvest, Bowery Farming, and AeroFarms combined.

Frequently Asked Questions

Who is the claims agent for AppHarvest?

Stretto, Inc. serves as the claims and noticing agent. The firm maintains the official claims register and distributes case notifications to creditors and parties in interest.

What happened to AppHarvest's farms?

The chapter 11 sale process resulted in the disposition of all four greenhouse facilities. Equilibrium acquired the Richmond and Morehead facilities through a $113 million credit bid. Bosch Berries Kentucky Operations Corp. purchased the Somerset facility. Mastronardi Berea acquired the Berea facility as part of the RSA settlement.

Is the AppHarvest bankruptcy case closed?

The case remains open. The plan became effective on December 5, 2023, but the Plan Administrator continues to reconcile claims and pursue avoidance actions. The claims-objection bar date has been extended, with the most recent proposed deadline set for June 29, 2026.

For more on recent chapter 11 cases in the agriculture and food sectors, visit the ElevenFlo blog.