Celsius Emerges from Chapter 11 and Commences Distributions of Over $3 Billion of Cryptocurrency to Creditors

HOBOKEN, New Jersey--(BUSINESS WIRE)--January 31, 2024--

Celsius Network LLC (“Celsius” or the “Company”) announced today that it has successfully emerged from bankruptcy by completing transactions under its confirmed plan of reorganization (the “Plan”). The Plan was overwhelmingly approved by approximately 98% of the Company's account holders and confirmed by the Bankruptcy Court for the Southern District of New York (the “Bankruptcy Court”) on November 9, 2023. This milestone marks the conclusion of an eighteen-month process. process during which the Company built consensus among a broad range of stakeholders, resolved novel and complex legal issues, fully cooperated with all regulatory investigations, and developed and consummated transactions under the Plan. The Plan includes the distribution of more than $3 billion in cryptocurrency and fiat money to Celsius' creditors, and the creation of a new Bitcoin mining company, Ionic Digital, Inc., which will be owned by Celsius' creditors and its mining operations will be managed by Hut 8 Corp. (Nasdaq | TSX: HUT) (“Hut 8”).

Following confirmation of the Plan and comments from the Securities and Exchange Commission (the “SEC”) on certain aspects of the Plan, Celsius, in close coordination with the Official Committee of Unsecured Creditors (the “UCC”), announced that it would the transition. to the “MiningCo Transaction”, in accordance with the Plan. Additionally, the Company increased the amount of cryptocurrency that would be available for distribution to creditors by nearly $250 million by converting altcoins to BTC or ETH and through prior agreements. The Bankruptcy Court approved the MiningCo Transaction on December 27, 2023.

Today, pursuant to the MiningCo transaction, the Company has begun distributing over $3 billion in liquid and fiat cryptocurrency to creditors and Ionic Digital has been created as a new Bitcoin mining company that will continue to deliver recoveries to creditors. Ionic Digital shares are expected to go public once necessary approvals are received. Ionic Digital will be owned by Celsius' creditors, who will hold equity in the form of common stock.

“Creating the best outcome for creditors by maximizing value and speed has been a priority for Celsius throughout this process,” said Chris Ferraro, plan administrator and former chief restructuring officer, interim chief executive and chief financial officer. “Today, more than 18 months after Celsius suspended withdrawals, we began distributing more than $3 billion in cryptocurrency, fiat, and Ionic Digital shares to Celsius creditors.”

"Our emergence from bankruptcy is the culmination of an extraordinary team effort and extensive collaboration between Celsius, Hut 8, strategic partners and our creditors," added David Barse and Alan Carr, members of Celsius' Special Committee of the Board, which have been leading Celsius through its Chapter 11 process. Barse and Carr continued: "When we were appointed in June 2022, everyone assumed that Celsius would completely disappear like the other cryptocurrency lenders that filed for bankruptcy around the same time. We, however, believed that Celsius could navigate complicated legal, regulatory and business issues. Among other achievements, Celsius secured cryptocurrency on our platform, reached an agreement with preferred shareholders, conducted a successful auction of the only reorganizable operating business to start As a new Bitcoin mining company, it established a litigation trust to pursue the countless counterparties who mined Celsius and, arguably most importantly, settled with the DOJ, SEC, and CFTC. But above all, we are proud of the preservation and distribution of cryptocurrency assets and the enhanced recovery for customers and claim holders.”

To facilitate safe, timely and fully compliant distributions, Celsius and its advisors have coordinated with the UCC and certain federal and state regulatory agencies throughout its restructuring.

Matt Prusak, chief commercial officer at Hut 8, has been appointed chief executive of Ionic Digital and will work with the previously announced board of directors, the majority of whom were appointed by UCC. Hut 8 will oversee Ionic Digital's Bitcoin mining business under a four-year management agreement. Additional details on Ionic Digital will be released soon.

Celsius will now seek an orderly winding down of its operations, including the discontinuation of Celsius' web and mobile applications.

Additional information about the restructuring process

The complete terms of the Plan and Disclosure Statement, as well as additional information regarding the Chapter 11 filing, including court documents, can be found online for free at https://cases.stretto.com/celsius. Interested parties with questions can call Stretto at +1 (855) 423-1530 (US) or +1 (949) 669-5873 (international) or send an email. celsiusinquiries@stretto.com.

Advisors

Kirkland & Ellis LLP is acting as legal advisor, Centerview Partners is acting as financial advisor, Alvarez & Marsal is acting as restructuring advisor, and C Street Advisory Group is acting as strategy and communications advisor to the Debtors.

White & Case LLP is acting as legal advisor, Perella Weinberg Partners is acting as investment banker and M3 Partners is acting as financial advisor to the Committee.

Cleary Gottlieb Steen & Hamilton LLP is serving as legal counsel to Ionic Digital.

Brown Rudnick LLP is serving as legal counsel to Hut 8.

About Celsius

Celsius is a global cryptocurrency platform and a recognized leader in Bitcoin mining. For additional information about the company, visit http://www.celsius.network. For additional information on Celsius' current Chapter 11 cases, visit http://www.cases.stretto.com/celsius.

See the source version at businesswire.com:https://www.businesswire.com/news/home/20240131994097/en/

CONTACT: Media Inquiries

press@celsius.network

KEYWORD: UNITED STATES NORTH AMERICA NEW JERSEY

INDUSTRY KEYWORD: LEGAL TECHNOLOGY FINANCE E-COMMERCE PROFESSIONAL SERVICES DIGITAL CASH/DIGITAL ASSET MANAGEMENT CRYPTOCURRENCY DATA MANAGEMENT BLOCKCHAIN

SOURCE: Celsius Network LLC

Copyright BusinessWire 2024.

PUB: 01/31/2024 18:18 / DISC: 01/31/2024 18:17

http://www.businesswire.com/news/home/20240131994097/en

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