Core Scientific explains its latest bankruptcy plan ahead of court date

1:10 am
December 5, 2023
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**Core Scientific Details Its Latest Bankruptcy Plan Ahead of Court Date**

Core Scientific, a Bitcoin (BTC) miner, has unveiled its strategy to emerge from bankruptcy in early January 2024. The plan is based on the third amended joint Chapter 11 plan filed on Nov. 16. The company attributes its financial difficulties to low revenue and plummeting Bitcoin prices. Despite a previous rejected bailout offer, Core Scientific is determined to turn its fortunes around. The company’s CEO, Adam Sullivan, presented the strategy in an audio commentary and emphasized its focus on addressing the needs of both common shareholders and holders of convertible notes. If the plan is approved by the Bankruptcy Court of the Southern District of Texas on Dec. 22, it will become effective on Jan. 5, 2024. Shareholders have until Dec. 13 to vote on the plan.

### Core Scientific’s Bankruptcy Plan Details

1. Common shareholders will receive new shares at a ratio of 25:1, providing them with $1.08 per pre-exchange share.
2. Noteholders will receive payouts of $1.628 on every $1 of face value for notes due in April and $1.201 per $1 face value for notes with an August due date. These payouts are scheduled for Jan. 3, 2024.
3. Upon emerging from bankruptcy, Core Scientific will have $709 million in net debt and $791 million in equity value on Jan. 5, 2024.
4. The company operates seven facilities across five states with a total operational capacity of 724 MW. It plans to add 372 MW of capacity through fiscal year 2027, projecting a revenue increase from $583 million in 2024 to $968 million in 2027.

### FAQ
**1. What led to Core Scientific’s bankruptcy filing?**
Core Scientific faced financial difficulties due to low revenue and declining Bitcoin prices.

**2. What is Core Scientific’s plan to emerge from bankruptcy?**
Core Scientific aims to restructure and turn its fortunes by presenting a strategy based on the third amended joint Chapter 11 plan filed on Nov. 16. The plan includes addressing the needs of both common shareholders and holders of convertible notes.

**3. What are the key points of Core Scientific’s bankruptcy plan?**
The company plans to offer common shareholders new shares at a ratio of 25:1, provide noteholders with scheduled payouts, and emerge from bankruptcy with a specified net debt and equity value. Additionally, it outlines its operational capacity and revenue projections for the coming years.

**4. When will Core Scientific’s bankruptcy plan take effect?**
The plan will be effective on Jan. 5, 2024, if approved by the Bankruptcy Court of the Southern District of Texas on Dec. 22.

**5. How long is the voting process for Core Scientific’s bankruptcy plan?**
Shareholders have until Dec. 13 to vote on the plan.


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