8-K: Current report filing
Published on December 28, 2023
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM
CURRENT REPORT
Pursuant to Section 13 OR 15(d)
of the Securities Exchange Act of 1934
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (17 CFR §230.405) or Rule 12b-2 of the Securities Exchange Act of 1934 (17 CFR §240.12b-2).
Emerging growth company
If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.
| * | The registrant’s common stock and warrants began trading exclusively on the OTC Pink Marketplace on January 3, 2023 under the Symbols “CORZQ” and “CRZWQ,” respectively. |
| Item 7.01 | Regulation FD Disclosure. |
Plan and Disclosure Statement
As previously disclosed, on December 21, 2022, Core Scientific, Inc. (the “Company”) and certain of its affiliates (collectively, the “Debtors”) filed voluntary petitions (the “Chapter 11 Cases”) in the United States Bankruptcy Court for the Southern District of Texas (the “Bankruptcy Court”) seeking relief under Chapter 11 of Title 11 of the United States Code (the “Bankruptcy Code”). The Debtors continue to operate their business and manage their properties as “debtors-in-possession” under the jurisdiction of the Bankruptcy Court and in accordance with the applicable provisions of the Bankruptcy Code and orders of the Bankruptcy Court. Additional information about the Chapter 11 Cases, including access to Court documents, is available online at cases.stretto.com/CoreScientific/, a website administered by Stretto, Inc., a third-party bankruptcy claims and noticing agent. The information on this web site is not incorporated by reference into, and does not constitute part of, this Form 8-K.
Also, as previously disclosed, on November 16, 2023, the Debtors filed the Third Amended Joint Chapter 11 Plan of Reorganization of Core Scientific, Inc. and its Debtor Affiliates (the “Third Amended Plan”) and the related Disclosure Statement for the Plan (the “Disclosure Statement”) with the Bankruptcy Court. Further, on November 17, 2023, the Bankruptcy Court entered an order, among other things, conditionally approving the Disclosure Statement and authorizing the Debtors to solicit acceptances for the Plan.
Also, as previously disclosed, on December 18, 2023, the Debtors, the committee of unsecured creditors of the Debtors, the ad hoc group of the Debtors’ secured convertible notes holders, the equity committee (the “Equity Committee”), the members of the Equity Committee, other than Foundry Digital LLC and B. Riley Commercial Capital, LLC and BRF Finance Co., LLC (and any assignees thereof) reached an agreement in principle with respect to the terms of a global settlement of Plan issues between such parties (the “Global Plan Settlement”).
On December 26, 2023, the Debtors filed the Fourth Amended Joint Chapter 11 Plan of Reorganization of Core Scientific, Inc. and its Debtor Affiliates (the “Fourth Amended Plan”) with the Bankruptcy Court. On December 27, 2023, the debtors filed a related supplement to the Disclosure Statement (the “Disclosure Statement Supplement”) with the Bankruptcy Court. The Disclosure Statement Supplement describes, among other things, the Fourth Amended Plan; the Restructuring; the events leading to the Chapter 11 Cases; certain events that have occurred or are anticipated to occur during the Chapter 11 Cases, including the anticipated solicitation of votes to approve the Fourth Amended Plan from certain of the Debtors’ creditors; and certain other aspects of the Restructuring.
Although the Debtors intend to pursue the Restructuring in accordance with the terms set forth in the Fourth Amended Plan, there can be no assurance that the Fourth Amended Plan will be approved by the Bankruptcy Court or that the Debtors will be successful in consummating the Restructuring or any other similar transaction on the terms set forth in the Fourth Amended Plan, on different terms or at all. Bankruptcy law does not permit solicitation of acceptances of a proposed Chapter 11 plan of reorganization until the Bankruptcy Court approves a disclosure statement relating to the Fourth Amended Plan. Accordingly, neither the Debtors’ filing of the Fourth Amended Plan and Disclosure Statement Supplement, nor this Current Report on Form 8-K, is a solicitation of votes to accept or reject the Fourth Amended Plan. Any such solicitation will be made pursuant to and in accordance with applicable law, including orders of the Bankruptcy Court. The Fourth Amended Disclosure Statement is being submitted to the Bankruptcy Court for approval but has not been approved by the Bankruptcy Court to date.
Information contained in the Fourth Amended Plan and the Disclosure Statement Supplement is subject to change, whether as a result of amendments or supplements to the Fourth Amended Plan or Disclosure Statement Supplement, third-party actions, or otherwise, and should not be relied upon by any party. Such amendments and supplements will also be available for review and free of charge online at cases.stretto.com/CoreScientific/. Such amendments and supplements may be filed with the Bankruptcy Court without the filing of an accompanying Current Report on Form 8-K. The documents and other information available via website or elsewhere are not part of this Current Report on Form 8-K and shall not be deemed incorporated herein.
Copies of the Fourth Amended Plan and the Disclosure Statement Supplement are attached as Exhibits 99.1 and 99.2, respectively, to this Current Report on Form 8-K.
As of the date of this filing, the Company has reached agreements in principle concerning the material terms of the Restructuring and support for the Fourth Amended Plan with all of its key stakeholders. Such agreements, including the Global Plan Supplement, are embodied in the Fourth Amended Plan.
Plan Supplement
Also, as previously disclosed on December 8, 2023, the Debtors filed a supplement to the Third Amended Plan (as amended, the “Plan Supplement”) with the Bankruptcy Court, and on December 11, 2023, the Debtors filed a further supplement to the Third Amended Plan with the Bankruptcy Court.
On December 27, 2023, the Debtors filed a supplement to the Fourth Amended Plan with the Bankruptcy Court (the “Second Amended Plan Supplement”). The Second Amended Plan Supplement includes a schedule of Allowed General Unsecured Claims (as defined in the Fourth Amended Plan). The documents in the Second Amended Plan Supplement replace and supersede all prior-filed versions of such documents, as applicable. The documents contained in the Plan Supplement have not yet been approved by the Bankruptcy Court. A copy of the Second Amended Plan Supplement is attached as Exhibit 99.3 to this Current Report on Form 8-K.
The foregoing descriptions of the Fourth Amended Plan, the Disclosure Statement Supplement and the Second Amended Plan Supplement do not purport to be complete and are qualified in their entirety by reference to the full text of the Fourth Amended Plan, the Disclosure Statement Supplement and the Second Amended Plan Supplement.
In accordance with General Instruction B.2 of Form 8-K, the information being furnished under this Item 7.01 of this Current Report on Form 8-K, including Exhibit 99.1, Exhibit 99.2 and Exhibit 99.3, shall not be deemed to be “filed” for purposes of Section 18 of the Exchange Act or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference into any registration statement or other document filed by the Company under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such filing.
Cautionary Statement Regarding Forward-Looking Information
This Form 8-K includes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements may be identified by the use of words such as “estimate,” “plan,” “project,” “forecast,” “intend,” “will,” “expect,” “anticipate,” “believe,” “seek,” “target” or other similar expressions that predict or indicate future events or trends or that are not statements of historical matters. The Company’s actual results may differ materially from those anticipated in these forward-looking statements as a result of certain risks and other factors, which could include the following: risks and uncertainties relating to the Company’s Chapter 11 Cases including but not limited to, the Company’s ability to obtain Bankruptcy Court approval with respect to motions in its Chapter 11 Cases, successfully enter into and implement a restructuring plan, emerge from Chapter 11 and achieve significant cash flows from operations; the effects of the Chapter 11 Cases on the Company and on the interests of various constituents, Bankruptcy Court rulings in the Chapter 11 Cases and the outcome of the Chapter 11 Cases in general, the length of time the Company will operate under the Chapter 11 Cases, risks associated with any third-party motions in the Chapter 11 Cases, the potential adverse effects of the Chapter 11 Cases on the Company’s liquidity or results of operations and increased legal and other professional costs necessary to execute the Company’s reorganization; finalization and receipt of the replacement debtor-in-possession facility; satisfaction of any conditions to which the Company’s debtor-in-possession financing is subject and the risk that these conditions may not be satisfied for various reasons, including for reasons outside of the Company’s control; the consequences of the acceleration of the Company’s debt obligations; the trading price and volatility of the Company’s common stock and the risks related to trading on the OTC Pink Market; as well as other risk factors set forth in the Company’s Annual Report on Form 10-K and Quarterly Reports on Form 10-Q filed with the Securities and Exchange Commission. These statements are provided for illustrative purposes only and are based on various assumptions, whether or not identified in this Current Report on Form 8-K, and on the current expectations of the Company’s management. These forward-looking statements are not intended to serve, and must not be relied on by any investor, as a guarantee, an assurance, a prediction or a definitive statement of fact or probability. Actual events and circumstances are difficult or impossible to predict and will differ from assumptions. Many actual events and circumstances are beyond the control of the Company. These forward-looking statements are subject to a number of risks and uncertainties, including those identified in the Company’s reports filed with the U.S. Securities & Exchange Commission, and if any of these risks materialize or our assumptions prove incorrect, actual results could differ materially from the results implied by these forward-looking statements. Accordingly, undue reliance should not be placed upon the forward-looking statements.
| Item 9.01. | Financial Statements and Exhibits. |
(d) Exhibits:
| Exhibit | Description | |
| 99.1 | Fourth Amended Joint Chapter 11 Plan of Reorganization of Core Scientific, Inc. and its Debtor Affiliates, dated December 26, 2023 | |
| 99.2 | Supplement to Disclosure Statement for Debtors’ Fourth Amended Joint Chapter 11 Plan of Reorganization of Core Scientific, Inc. and its Debtor Affiliates, dated December 27, 2023 | |
| 99.3 | Second Amended Plan Supplement, dated as of December 27, 2023 | |
| 104 | Cover page Interactive Data File (embedded within the Inline XBRL document). | |
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Core Scientific, Inc. | ||||||
| Date: December 28, 2023 | By: | /s/ Todd M. DuChene |
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| Name: | Todd M. DuChene | |||||
| Title: | Chief Legal Officer and Chief Administrative Officer | |||||