Bright Green files for Chapter 11 to effect restructure

April 2025 | DEALFRONT | BANKRUPTCY & CORPORATE RESTRUCTURING

Financier Worldwide Magazine

April 2025 Issue

As part of its plans to reorganise and relaunch under a new name, pharmaceutical company Bright Green Corporation has filed for Chapter 11 bankruptcy protection.

The filing allows Bright Green to implement the terms of a prepackaged restructuring support agreement (RSA) with Lynn Stockwell, a majority shareholder who will serve as plan sponsor, chief executive and chair of the company.

The company expects its operations to continue as normal throughout the contemplated court-supervised Chapter 11 bankruptcy process.

A first-mover in the US federally-authorised cannabis space, Bright Green is one of eight companies selected by the US government to grow, manufacture and sell – legally under federal and state laws – cannabis and cannabis-related products for research, pharmaceutical applications and affiliated export.

Through legal partnerships with state and federal agencies – including a memorandum of agreement from the US Drug Enforcement Administration (DEA) – Bright Green operates at a scale that is unprecedented in emerging cannabis markets.

“Bright Green Corporation was in an extraordinary unique position to produce, manufacture and research legal controlled substances, under registration and licensing with both state and the federal government,” said Ms Stockwell. “The company was unable to take advantage of the opportunity and was compromised financially when globalisation policies were not favourable for research, production and manufacturing within the US.

“The company will implement its owner and operator plans for a $3.5bn investment in new DEA and Food and Drug Administration compliant mega farms to produce controlled substances to supply and strengthen the ‘Drugs Made in America Supply Chain’,” continued Ms Stockwell. “Each owner and operator will have access to federal loan guarantees for the new infrastructure that is expected to create thousands of new jobs.”

The RSA provides, among other things, the funding of an exit facility by the plan sponsor, the payment in full in cash of all allowed administrative claims and allowed professional fee claims from the proceeds of the exit facility, the rollup of a secured note held by the plan sponsor into the exit facility and its repayment pursuant to the terms of the exit facility, and the reorganisation of the company.

The reorganisation will involve Bright Green repaying creditors of allowed general unsecured claims in the form of 20 percent in cash plus 80 percent in newly issued common stock, issuing new common stock in the company to the existing holders of common stock after a 1 for 50 reverse stock split, and retiring, cancelling, extinguishing or discharging the company’s outstanding warrants and other contracts.

In addition, the Florida-based company, which anticipates changing its name to ‘Drugs Made in America Corp’ upon emergence from Chapter 11, is expected to continue its exclusive partnership with Asia Capital Pioneer Group Inc to help support its EB-5 marketing efforts across Asia (EB-5 is a programme created by Congress in 1990 to stimulate the US economy through job creation and capital investment by foreign investors).

Ms Stockwell concluded: “I look forward to the new administration’s promise to onboard the production and manufacturing of both the active pharmaceutical ingredient and prescription drugs back to the US, creating an opportunity for this well-positioned company to rationalise regulation for drugs made in America.”

Fraser Tennant