July 4, 2014 12:42:57 AM
William Browning - firstname.lastname@example.org
The Mississippi Development Authority confirmed Thursday that KiOR, an alternative fuel company that in 2011 built a $218 million facility in Columbus, did not make its latest scheduled loan payment to the state.
MDA loaned the Texas-based business $75 million in 2010. KiOR made its first three loan payments of $1.8 million to the state. The fourth was due June 30. It never arrived.
However, Jeff Rent, public relations manager for MDA, told The Dispatch that the state has negotiated a short-term forbearance agreement with KiOR that allowed the company to pay $250,000 in exchange for the state postponing collection efforts.
The state is the first lien holder on KiOR's real property and equipment on The Island.
The postponement lasts four months, according to Rent.
The company owes the state more than $69 million.
The missed loan payment is the latest in a string of setbacks for the once promising company.
The company's plant on The Island -- designed to convert wood chips to fuel -- has not operated since December. The company has said it struggled to perfect the conversion method, which was a first-of-its-kind process.
In March, the company entered into a deal worth $25 million with a company controlled by Vinod Khosla, a billionaire investor from California. The company stated at the time that the deal would keep it out of bankruptcy through August. Khosla Ventures controls 88.5 percent of KiOR stock.
Two weeks ago, KiOR laid off 18 people at its Columbus plant. KiOR officials then said that due to "limited cash flow," more layoffs were expected. As of this week, 55 people were employed at the facility.
At the time of the layoffs, Rent said that MDA was aware of KiOR's struggles and would continue to monitor the company's financial situation.
KiOR has nearly $280 million in debt. When contacted earlier this week, KiOR officials declined to comment.
"The forbearance agreement does not diminish or affect the state's rights to collateral...or any of the core terms of the parties' original agreement," Rent said.
He added that MDA will continue to work closely with KiOR and "take all actions necessary to protect the state's interests."