Quarterly report pursuant to Section 13 or 15(d)

COMPUTE NORTH BANKRUPTCY

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COMPUTE NORTH BANKRUPTCY
9 Months Ended
Sep. 30, 2022
Compute North Bankruptcy  
COMPUTE NORTH BANKRUPTCY

NOTE 6 – COMPUTE NORTH BANKRUPTCY

 

On September 22, 2022, Compute North Holdings, Inc. (along with its affiliated debtors, collectively, “Compute North”), filed for chapter 11 bankruptcy protection in the U.S. Bankruptcy Court for the Southern District of Texas under Chapter 11 of the U.S. Bankruptcy Code (11 U.S. Code section 101 et seq.). Marathon’s financial exposure to Compute North at the time of the bankruptcy filing included:

 

- Approximately $10 million in Convertible Preferred Stock of Compute North Holdings, Inc.
- Approximately $21 million related to an unsecured Senior Promissory note with Compute North LLC.
- Approximately $50 million in operating deposits with Compute North primarily related to the King Mountain and Wolf Hollow hosting facilities.

 

The Company assessed this financial exposure and recorded an impairment of the Convertible Preferred Stock, the unsecured Senior Promissory note and certain deposits totaling $39 million during the three months ended September 30, 2022. The ultimate outcome of the bankruptcy process, and its impact on the remaining deposits held by the Company, remains to be determined. The Company has engaged creditor’s counsel and is vigorously defending and protecting its various assets at the Compute North facilities as well as minimizing its long-term financial exposure with regard to Compute North.