According to accusations made by its lender, Iris Energy (IREN), a company that mines bitcoins, has defaulted on equipment loans totaling $103 million that were held by two unique vehicles (SPV).
According to a Monday statement with the U.S. Securities and Exchange Commission, the basis for the default notice that the lender gave to the miner on Nov. 4, is that the business failed to hold “good faith restructuring negotiations” for the disputed debt. Iris is being accused of missing payments initially due on October 25 because it allegedly refused to participate in such negotiations, according to the petition on Monday.
Iris Energy Has Creditors Waiting
The lender is attempting to activate an acceleration clause as a result, which means it is requesting prompt payment of the whole principle amount as well as any accumulated interest, according to the document. According to Iris, it “disagrees” with the claims stated by the lender in the notice dated November 4.
Recall that Iris Energy said on November 2 that the questioned bitcoin mining equipment does not generate enough revenue to pay off the associated financial obligations. The company stated at the time that it wouldn’t be able to fulfill its financial obligations to the two SPVs if negotiations to restructure the debt do not result in an agreement by November 8.
According to the corporation, the two loans in question, with principal sums of $32 million and $71 million as of September 30 respectively, are secured by mining equipment that generates 1.6 exahashes per second (EH/s) and 2.0 EH/s, respectively. In the case of default, the lender will not be able to collect any Iris Energy assets beyond the collateral because the debt is owned by two wholly-owned, non-recourse SPVs.