The US Bankruptcy Court gave an order to AppHarvest Products, LLC to obtain DIP financing on an interim basis on July 26, 2023. As per the order, the debtor has been authorized to obtain a term loan facility in the amount of $8 million out of the total financing of $24.30 million from CEFF II AppHarvest Holdings, LLC. The DIP loan would carry an interest rate of 12% p.a., along with an additional 3% p.a. interest in the event of default.

As per the terms of the DIP agreement, the loan carries a upfront fee of 3% payable in kind and exit fee of 5%. The DIP facility would mature either on the date that is 75 days after the petition date i.e., October 6, 2023 or on the effective date of the plan or the date of delivery of a termination notice, whichever is earlier. Adequate protection would be provided to the DIP lenders in the form of super-priority administrative expense claims which is subject to a carve-out of $0.05 million towards unpaid trustee fees and $1.50 million towards unpaid professional / administrative expenses and first priority lien upon and security interest in the debtor?s collateral.

Final hearing shall be held on August 10, 2023. The DIP financing shall be used to for working capital of the loan parties, for the payment of current interest, expenses and fees with respect to the loans and other obligations hereunder, for payment of allowed administrative costs and expenses of the bankruptcy cases, for payment of prepetition claims authorized by the bankruptcy court.