Core Scientific, a company in digital infrastructure for high-density colocation (HDC), entered into $600 million of committed senior secured credit facilities, consisting of a $100 million revolving credit facility and $500 million letter of credit facility.
The proceeds of borrowings under the revolving credit facility may be used for general corporate purposes and working capital needs. The letter of credit facility may be issued to provide credit support for specific project obligations under utility agreements and for other general corporate purposes of the company and its subsidiaries.
“We appreciate the group of financial institutions that worked with us to develop a financing solution tailored to the needs of our business,” Jim Nygaard, chief financial officer of Core Scientific, said. “The facilities are expected to release approximately $300 million of restricted cash, meaningfully improving our capital efficiency and financial flexibility as we pursue opportunities in a dynamic and rapidly evolving industry.”
Borrowings under the revolving credit facility have a three-year maturity and will bear interest at either adjusted term secured overnight financing rate (SOFR) plus 1.75% or an alternate base rate plus 0.75%, at the company’s election. Letters of credit issued under the letter of credit facility will carry an annual fee of 1.75% on outstanding amounts, as well as an annual 0.125% fronting fee.
The company’s obligations under the facilities are guaranteed by certain wholly owned domestic subsidiaries and secured by a first-priority lien on substantially all assets of the company and the guarantors.
Morgan Stanley Senior Funding acted as lead left arranger and joint bookrunner, and JPMorgan Chase Bank serves as administrative agent, collateral agent, joint lead arranger and joint bookrunner. Goldman Sachs and TD Securities (USA) as joint lead arrangers and joint bookrunners. At closing, commitments are expected to be allocated equally among Morgan Stanley, JPMorgan Chase Bank, Goldman Sachs and TD Securities.
