Bitcoin miner Core Scientific files Chapter 11 ‘reorganization’ plan
The reorganization plan, if it is approved, will allow claims to be paid out.
The reorganization plan awaits approval.
The introduction of the latest filing describes the plan as a “joint chapter 11 plan of reorganization.” The same section also suggests that claim holders and other parties must still vote on the plan before it is accepted or rejected.
A disclaimer says that the bankruptcy court has not yet approved the filing and that information in the plan is subject to change.
However, if the plan is enacted, those holding debtor-in-possession claims will receive “complete and final” satisfaction. Those claims can be redeemed for cash or alternatives the claim holders have agreed upon in writing.
The document mentions various types of claims and interests, including but not limited to mining equipment lender-secured claims. Core Scientific was unable to pay debts on loaned mining equipment, while security senior note holders held much of the company’s debt, according to reports published by CNBC in late 2022.
The filing also describes how claims can be settled, how Core Scientific can continue as a corporate entity, how distributions will be made, and how disputes will be handled.
Core Scientific continues to mine crypto.
Core Scientific initially filed for bankruptcy in December 2022. The company reported liabilities of up to $10 billion and more than 1,000 creditors.
The company’s bankruptcy proceedings are proceeding in the Houston Division of the U.S. District Court for the Southern District of Texas.
Despite those bankruptcy proceedings, Core Scientific reported positive cash flow at the time and continues to operate. The firm noted that it mined 31 BTC ($934,000) for its latest 24-hour reporting period on June 20.
The company’s stock (CORZQ) was up 12.84% on June 20.