Bitcoin miner Greenidge signs $74 million debt restructuring agreement with NYDIG
Bitcoin miner Greenidge signs $74 million debt restructuring agreement with NYDIG
#Bitcoin #miner #Greenidge #signs #million #debt #restructuring #agreement #NYDIG Welcome to InNewCL, here is the new story we have for you today:
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According to a new filing with the U.S. Securities and Exchange Commission Dec. 20, bitcoin (BTC) miner Greenidge said it has reached an agreement with its creditor, fintech firm NYDIG, to restructure debt worth hit about $74 million. The transaction, in the form of a non-binding term sheet, would result in a material change in Greenidge’s current business strategy. Essentially, Greenidge would go from self-mining to hosting NYDIG’s mining rigs.
Under the terms, NYDIG would purchase miners with approximately 2.8 exahash per second (EH/s) mining capacity hosted by Greenidge, which will facilitate NYDIG’s rights to a mining site within three months of the debt restructuring and hosting agreements being completed . In exchange for the purchased miners and the transfer of mining infrastructure and loans to NYDIG, the company would agree to a $57 million to $68 million debt reduction for Greenidge.
In addition, Greenidge will pledge a significant portion of its unencumbered assets to secure the balance of the NYDIG loan. The company would retain ownership of miners with a capacity of 1.2 EH/s. As of October 31, 2022, Greenidge had a mining capacity of approximately 2.5 EH/s from approximately 24,500 miners on the job.
However, the company also wrote that “there remains uncertainty about Greenidge’s financial condition and significant doubts about its ability to continue as a going concern.” Last month, Greenidge used approximately $8 million of its cash on hand, of which $5.5 million was used on principal and interest payments. As of November 30, 2022, the Company’s cash position was approximately $22.0 million. Greenidge also warned that “NYDIG and Greenidge will endeavor to produce definitive documentation that reflects the terms described in this press release, but no assurances can be given that these terms will not change materially, nor can any assurances be given that the transactions discussed in this release will be completed.”
Last September, Cointelegraph reported that Greenidge completed a merger with customer and technical support solutions provider Support.com to become a public mining company on the NASDAQ. Since then, shares have plunged over 99%, in part due to a combination of the ongoing crypto winter, higher electricity prices, higher mining difficulties, and lower Bitcoin mining rig market prices.
