Kalera PLC announced that its main operating subsidiary, Kalera, Inc., has filed a voluntary petition (the Chapter 11 Case) in the United States Bankruptcy Court for the Southern District of Texas seeking relief under 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.
Image credits: Kalera/Michael Hart
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 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.
CEO fired
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 a member of the Company's Board of Directors.
Kalera also announced that it has retained the law firm Baker & Hostetler LLP as its legal advisor and B. Riley Advisory Services as its 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.
Loan and security agreement
On April 14, 2022, Kalera entered into a Loan and Security Agreement with Farm Credit of Central Florida, ACA, 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.
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 automatically stay 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 more information:
Kalera
[email protected]
www.kalera.com