KALERA PLC ANNOUNCES ITS WHOLLY-OWNED AND MAIN OPERATING SUBSIDIARY, KALERA, INC., FILES FOR CHAPTER 11 PROTECTION TO PURSUE FINANCIAL AND OPERATIONAL REOGRANIZATION
04 4월 2023 - 10:05PM
Kalera Public Limited Company (“Kalera PLC” or the “Company”)
(Nasdaq: KAL), a vertical farming company headquartered in Orlando,
Florida, announced today that its wholly-owned and main operating
subsidiary, Kalera, Inc. (“Kalera”) has filed a voluntary petition
(the “Chapter 11 Case”) in the United States Bankruptcy Court for
the Southern District of Texas (the “Bankruptcy Court”) seeking
relief under Chapter 11 (“Chapter 11”) of Title 11 of the United
States Code (the “Bankruptcy Code”). Kalera will continue to
operate its business as “debtor-in-possession” under the
jurisdiction of the Bankruptcy Court and in accordance with the
applicable provisions of the Bankruptcy Code and orders of the
Bankruptcy Court. Kalera will be filing various "First-Day" motions
with the Bankruptcy Court requesting customary relief that will
enable Kalera to transition into Chapter 11 without disruption to
its ordinary course operations.
Kalera PLC, Kalera S.A. and other subsidiaries including
Vindara, Inc. and Iveron Materials, Inc. are not included in the
Chapter 11 filing. Kalera intends to use the court-supervised
process to evaluate strategic alternatives for Kalera, including a
potential sale of Kalera or its assets.
In connection with the filing, Kalera PLC has appointed Mark
Shapiro, Senior Managing Director at B. Riley Advisory Services, as
Chief Restructuring Officer. Mr. Shapiro will oversee the business
and its restructuring process, working to execute on the Company’s
business strategy and conduct a value-maximizing sale process. Mr.
Shapiro brings deep experience in managing complex financial and
operational restructurings, including providing interim management
services to preserve and maximize value.
“The Chapter 11 process will allow Kalera to continue operations
and serve its existing customer base while it evaluates strategic
alternatives for its business and assets,” said Mark Shapiro, Chief
Restructuring Officer for Kalera PLC.
To enable Kalera to continue operations during the
reorganization process, Kalera’s existing lender has agreed to
provide Kalera with $5.1 million of debtor-in-possession (DIP)
financing subject to the satisfaction of certain customary
conditions, including the approval of the Bankruptcy Court (which
has not been obtained at this time).
Effective as of March 29, 2023, Jim Leighton’s employment with
the Company as President and Chief Executive Officer ended, so that
Mr. Leighton could pursue other opportunities. Mr. Leighton
also resigned as member of the Company’s Board of Directors (the
“Board”). The Company’s executive management team, including Austin
Martin (Chief Operating Officer), Fernando Cornejo (Chief Financial
Officer), Dr. Cristian Toma (Founder and Chief Science Officer),
and Leon Lachance (Senior VP of Human Resources) will remain with
the Company. The following individuals will remain on the Board:
Curtis Williams (Chair of the Board), Robert Arnall, Brent de Jong,
Sonny Perdue, and Dr. Cristian Toma.
Kalera also announced that it has retained the law firm Baker
& Hostetler LLP, as legal advisor, and B. Riley Advisory
Services, as financial advisor, to assist in the Chapter 11 Case
filing, its restructuring and review of all available strategic
alternatives. In light of this ongoing review, the Company was not
able to file its Annual Report on Form 10-K for the year ended
December 31, 2022 by March 31, 2022. At the present time the
Company does not have an estimate of when such filing will be
made.
On April 14, 2022, Kalera entered into a Loan and Security
Agreement (“Loan Agreement”) with Farm Credit of Central Florida,
ACA (“Farm Credit”), under which Farm Credit agreed to make (i)
revolving loans in an aggregate principal amount of up to $10
million and (ii) one or more term loans in an aggregate principal
amount up to $20 million (collectively the “Loans”). On March 21,
2023, Farm Credit informed Kalera that as of the close of business
on March 17, 2023, Farm Credit had sold its interest under the Loan
Agreement to Sandton Credit Solutions Master Fund V, L.P.
(“Sandton”).
The commencement of the Chapter 11 Case constituted an Event of
Default that accelerates Kalera’s obligations under the Loan
Agreement. The Loan Agreement provides that upon the Chapter 11
Case filing the unpaid principal and interest due under the Loan
Agreement are automatically due and payable. However, any efforts
to enforce such payment obligations under the Loan Agreement are
automatically stayed as a result of the Chapter 11 Case filing, and
the creditors’ rights of enforcement in respect of the Loan
Agreement are subject to the applicable provisions of the
Bankruptcy Code.
For further information about the case please refer to the
following website: https://cases.creditorinfo.com/kalera
Cautionary Statements
Kalera is our main operating subsidiary. We caution our equity
holders that trading in our securities during the pendency of the
Chapter 11 Case will be highly speculative and will pose
additional, substantial risks in addition to the various risks that
we have previously disclosed in our press releases, registration
statements filed under the Securities Act of 1933, as amended, and
periodic reports and schedules filed under the Securities Exchange
Act of 1934, as amended (the “Exchange Act”). Trading prices for
our equity securities are not expected to bear any substantive
relationship to any recovery that Kalera PLC may obtain in the
Chapter 11 Case. There is no assurance the Company will be able to
continue operations for the foreseeable future or realize assets
and discharge liabilities. Accordingly, we urge extreme caution
with respect to existing and future investments in our equity or
debt securities.
A plan of reorganization, sale of assets, or liquidation of
Kalera will likely result (i) in our receiving little or no
distribution in respect of our interest in Kalera, and (ii) in the
cancellation of our existing equity interest in Kalera. If certain
requirements of the Bankruptcy Code are met, a Chapter 11 plan of
reorganization could be confirmed notwithstanding its rejection by
Kalera PLC, as the equity holder of Kalera, and notwithstanding the
fact that Kalera PLC does not receive or retain any property on
account of its equity interest under such plan.
Forward-Looking Statements This press release
contains forward-looking statements within the meaning of the
federal securities laws, which are based on management’s current
expectations, estimates and projections. Forward looking statements
also include statements regarding the Company’s plans with respect
to the Chapter 11 proceedings, Kalera’s plan to continue its
operations while it works to complete its proposed reorganization,
Kalera’s proposed debtor-in-possession financing, the Company’s
plans regarding existing vertical farms and other statements
regarding the proposed reorganization, strategy, future operations,
performance and prospects. These forward-looking statements are
subject to risks and uncertainties that could cause actual results
to differ materially from the expectations expressed in the
forward-looking statements. These risks, uncertainties and events
also include, but are not limited to, the following: Kalera’s
ability to obtain timely approval of the Bankruptcy Court with
respect to motions filed in the Chapter 11 proceedings; objections
to the DIP financing or other pleadings filed that could protract
the Chapter 11 proceedings; the Bankruptcy Court’s rulings in the
Chapter 11 proceedings, including the approvals of the terms and
conditions of the DIP financing, and the outcome of the Chapter 11
proceedings generally; Kalera’s ability to comply with the
restrictions imposed by the terms and conditions of the DIP
financing, including Kalera’s ability to obtain additional
financing and Kalera’s ability to obtain a timely sale of assets or
approval of a plan of reorganization; the length of time that
Kalera will operate under Chapter 11 protection and the continued
availability of operating capital during the pendency of the
Chapter 11 proceedings; Kalera’s ability to continue to operate its
business during the pendency of the Chapter 11 proceedings;
employee attrition and Kalera’s ability to retain senior management
and other key personnel due to the distractions and uncertainties;
the effectiveness of the overall restructuring activities pursuant
to the Chapter 11 proceedings and any additional strategies the
Company may employ to address its liquidity and capital resources;
the actions and decisions of creditors and other third parties that
have an interest in the Chapter 11 proceedings; risks associated
with third parties seeking and obtaining authority to terminate or
shorten Kalera’s exclusivity period to propose and confirm one or
more plans of reorganization, for the appointment of a Chapter 11
trustee or to convert the Chapter 11 proceeding to a Chapter 7
proceeding; increased legal and other professional costs necessary
to execute Kalera’s restructuring; Kalera’s ability to maintain
relationships with suppliers, customers, employees and other third
parties and regulatory authorities as a result of the Chapter 11
proceedings; the trading price and volatility of the Company’s
common stock; litigation and other risks inherent in a bankruptcy
process; the risks described in the Cautionary Statement above; and
the other factors listed in Kalera PLC’s filings with the
Securities and Exchange Commission. Except as may be required by
law, Kalera PLC disclaims any obligation to update any
forward-looking statements to reflect events or circumstances after
the date on which the statements were made or to reflect the
occurrence of unanticipated events.
Contact
Mark ShapiroChief Restructuring OfficeEmail:
kalera@bmcgroup.com
Kalera Public (NASDAQ:KAL)
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