Bitcoin Miner Stronghold Announces Agreement Changes with WhiteHawk Finance, Foundry
The changes are designed to better situate the company for their future endeavors.
Stronghold Digital Mining, with WhiteHawk Finance LLC, has announced ratifications to their original credit agreement according to a press release sent to Bitcoin Magazine. In addition to this announcement, Stronghold has entered a new two year contract with Foundry Digital, replacing their previous temporary contract.
The changes to the credit agreement are “designed to provide Stronghold with significantly enhanced liquidity and financial flexibility,” according to the announcement. The following terms are defined:
- No mandatory principal amortization payments until July 2024.
- Principal repayment through cash sweep.
- Option to pay interest in kind for up to six months.
- Elimination of all leverage covenants before Q3 2024.
- Reduced minimum liquidity covenants.
- And no dilution, with the terms saying that “no equity will be issued in relation to the Amendment to the Credit Agreement.”
Greg Beard, co-chairman and chief executive officer of Stronghold explained, “We are appreciative of WhiteHawk’s continued partnership as we manage through the volatility in Bitcoin and power markets. Our efforts to anticipate and respond proactively to challenges in our markets while prioritizing liquidity have helped us endure through this environment.”
In regards to the new Foundry agreement, the release explains that it “applies to the same Bitcoin mining fleet of approximately 4,500 miners with total hash rate capacity of approximately 420 PH/s and average efficiency of approximately 35 J/TH.” It has similar terms to the previous, with the following differences:
- “The agreement term is two years, with no unilateral early termination option.
- The applicable hosting fee will be the realized net cost of power at the Company’s Panther Creek Plant plus 10%, calculated on a monthly basis.
- Foundry will participate in profit generated from selling power to the grid when miners are curtailed.”
In regards to the amended agreement, Beard said that the company is “excited to continue to partner with Foundry with this new long-term agreement, whereby Foundry will fully participate in our vertically integrated business model, validating our differentiated strategy. Further, the multi-year nature of the agreement offers certainty around keeping miners installed and is a natural pathway to fill a portion of our open miner slots capable of supporting approximately 4 EH/s of miners utilizing our self-generated power.”
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