Bitcoin miner Stronghold Digital Mining agrees to defer $54.9 million loan payments

American mining company Stronghold Digital Mining restructured payments on the remaining loan balance of approximately $54.9 million from Whitehawk Finance and entered into a hosting agreement with Foundry.

“The amended credit agreement is designed to provide Stronghold with significantly greater liquidity and financial flexibility,” the press release said.

Under the new agreement, the required principal payments will begin in June 2024. Under the original terms, the amount of payments due before that date totaled $29 million.

From June 2023, Stronghold will amortize the principal by using 50% of the average monthly cash balance in excess of $7.5 million.

Whitehawk agreed to relief in interest payments as well as to the debt-to-earnings and liquidity covenants for Stronghold.

As a result of the new agreements, the creditor will gain a seat on the miner’s board of directors and the right to appoint one observer.

Stronghold also signed a new two-year hosting agreement with Foundry, DCG, led by Barry Silbert. The facility will continue to host the company’s fleet of approximately 4,500 ASIC miners with a hashrate of 420 PH/s.

The changes affected hosting fees and Foundry’s participation in the profits from the return of electricity to the grid during outages of cryptocurrency mining equipment.

The data centre is powered by the Panther Creek power plant owned by Stronghold.

As a reminder, in August 2022 the mining company agreed with Whitehawk to extend the loan term and to secure a new $20 million credit line.