Compute North’s Chapter 11 plan draws objection from committee

By Sarah Lizee

Olympia, Wash., Dec. 16 – Compute North LLC’s Chapter 11 plan of liquidation and related disclosure statement drew an objection Thursday from the official committee of unsecured creditors, according to documents filed with the U.S. Bankruptcy Court for the Southern District of Texas.

The debtors are hoping to schedule a combined hearing on confirmation of the plan and approval of the disclosure statement on Jan. 9.

The committee said delaying consideration of the disclosure statement until the combined hearing, when votes on the plan will already have been cast, does nothing toward providing creditors with information they need now to cast their votes in an informed manner.

The company said there are also inadequacies in the disclosure statement that could lead to an expensive and duplicative re-solicitation process.

“The far better procedure is to address the informational deficits now, before the estates incur the costs of soliciting votes based upon a flawed disclosure statement,” the committee said in its objection.

The committee also said the plan can’t be confirmed in its current form because it contains overly broad and unjustifiable releases and an exculpation provision that violates clear Fifth Circuit precedent.

The committee said that if the court allows solicitation to move forward, it will ask that it be allowed to include a letter to unsecured creditors in the solicitation package.

Compute North, an Eden Prairie, Minn.-based company, operates crypto-mining data centers. The company filed bankruptcy on Sept. 22 under Chapter 11 case number 22-90275.

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