Core Scientific is seeking emergency relief from the bankruptcy court for it to secure a replacement loan facility.
According to court documents, the miner has agreed to a $70 million credit facility from investment banking firm B. Riley.
The company will use the funds to pay off an existing loan to avoid defaulting,
Core Scientific, a Bitcoin mining firm that filed for Chapter 11 bankruptcy orotection in December last year, says it’s agreed to a $70 million financing facility from B. Riley Commercial Capital, LLC.
Court documents the Bitcoin miner filed on Tuesday reveal that the crypto company seeks to use the loan facility from the investment bank to pay off an existing debtor-in-possession (DIP) facility.
Core Scientific seeks emergency relief
The miner seeks an emergency relief from the bankruptcy court, which it says is needed no later than 11:30 am CET on Wednesday, 1 February, 2023. As noted in the filing, the crypto miner would be in default under the terms of the original DIP facility.
The Core Scientific team says if approved, the first part of the facility will be $35 million before the rest follow. Securing the new credit facility from B. Riley is key to the miner continuing its operations as it navigates its bankruptcy process.
The past year proved to be particularly brutal for crypto mining companies, with the crash in Bitcoin prices and surging energy costs combining to hurt business. Core Scientific was one of the largest miners to seek bankruptcy protection as Bitcoin price collapsed once more following crypto exchange FTX’s implosion.
At the time of its bankruptcy filing, Core Scientific revealed liabilities of $1 billion to $10 billion.
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