☒   Statement of cash receipts and disbursements

☒   Balance sheet containing the summary and detail of the assets, liabilities and equity (net worth) or deficit

☒   Statement of operations (profit or loss statement)

☐   Accounts receivable aging

☐   Postpetition liabilities aging

☐   Statement of capital assets

☐   Schedule of payments to professionals

☐   Schedule of payments to insiders

☐   All bank statements and bank reconciliations for the reporting period

☐   Description of the assets sold or transferred and the terms of the sale or transfer

/s/ Clifford W. Carlson

Clifford W. Carlson

01/31/2024

700 Louisiana Street, Suite 3700, Houston, Texas 77002

Part 1: Cash Receipts and Disbursements

a.   Cash balance beginning of month

b.  Total receipts (net of transfers between accounts)

c.   Total disbursements (net of transfers between accounts)

d.  Cash balance end of month (a+b-c)

e.   Disbursements made by third party for the benefit of the estate

f.   Total disbursements for quarterly fee calculation (c+e)

Part 2: Asset and Liability Status

(Not generally applicable to Individual Debtors. See Instructions.)

a.   Accounts receivable (total net of allowance)

b.  Accounts receivable over 90 days outstanding (net of allowance)

c.   Inventory ( Book Market Other (attach explanation))

d   Total current assets

e.   Total assets

f.   Postpetition payables (excluding taxes)

g.  Postpetition payables past due (excluding taxes)

h.  Postpetition taxes payable

i.   Postpetition taxes past due

j.   Total postpetition debt (f+h)

k.  Prepetition secured debt

l.   Prepetition priority debt

m.   Prepetition unsecured debt

n.  Total liabilities (debt) (j+k+l+m)

o.  Ending equity/net worth (e-n)

Part 3: Assets Sold or Transferred

a.   Total cash sales price for assets sold/transferred outside the ordinary course of business

b.  Total payments to third parties incident to assets being sold/transferred outside the ordinary course of business

c.   Net cash proceeds from assets sold/transferred outside the ordinary course of business (a-b)

Part 4: Income Statement (Statement of Operations)

(Not generally applicable to Individual Debtors. See Instructions.)

a.   Gross income/sales (net of returns and allowances)

b.  Cost of goods sold (inclusive of depreciation, if applicable)

c.   Gross profit (a-b)

d.  Selling expenses

e.   General and administrative expenses

f.   Other expenses

g.  Depreciation and/or amortization (not included in 4b)

h.  Interest

i.   Taxes (local, state, and federal)

j.   Reorganization items

k.  Profit (loss)

Part 5: Professional Fees and Expenses

Approved
Current Month

Approved
Cumulative

Paid
Current Month

Paid
Cumulative

b.

Part 6: Postpetition Taxes

a.   Postpetition income taxes accrued (local, state, and federal)

b.  Postpetition income taxes paid (local, state, and federal)

c.   Postpetition employer payroll taxes accrued

d.  Postpetition employer payroll taxes paid

e.   Postpetition property taxes paid

f.   Postpetition other taxes accrued (local, state, and federal)

g.  Postpetition other taxes paid (local, state, and federal)

Part 7: Questionnaire - During this reporting period:

a.   Were any payments made on prepetition debt? (if yes, see Instructions)

b.  Were any payments made outside the ordinary course of business without court approval? (if yes, see Instructions)

c.   Were any payments made to or on behalf of insiders?

d.  Are you current on postpetition tax return filings?

e.   Are you current on postpetition estimated tax payments?

f.   Were all trust fund taxes remitted on a current basis?

g.  Was there any postpetition borrowing, other than trade credit? (if yes, see Instructions)

h.  Were all payments made to or on behalf of professionals approved by the court?

i.   Do you have:

If yes, are your premiums current?

If yes, are your premiums current?

If yes, are your premiums current?

j.   Has a plan of reorganization been filed with the court?

k.  Has a disclosure statement been filed with the court?

l.   Are you current with quarterly U.S. Trustee fees as set forth under 28 U.S.C. § 1930?

Part 8: Individual Chapter 11 Debtors (Only)

a.   Gross income (receipts) from salary and wages

b.  Gross income (receipts) from self-employment

c.   Gross income from all other sources

d.  Total income in the reporting period (a+b+c)

e.   Payroll deductions

f.   Self-employment related expenses

g.  Living expenses

h.  All other expenses

i.   Total expenses in the reporting period (e+f+g+h)

j.   Difference between total income and total expenses (d-i)

k.  List the total amount of all postpetition debts that are past due

l.   Are you required to pay any Domestic Support Obligations as defined by 11 U.S.C § 101(14A)?

m.   If yes, have you made all Domestic Support Obligation payments?

The Debtors in these chapter 11 cases, along with the last four digits of each Debtor’s federal tax identification number, are as follows: Core Scientific Mining LLC (6971); Core Scientific, Inc. (3837); Core Scientific Acquired Mining LLC (6074); Core Scientific Operating Company (5526); Radar Relay, Inc. (0496); Core Scientific Specialty Mining (Oklahoma) LLC (4327); American Property Acquisition, LLC (0825); Starboard Capital LLC (6677); RADAR LLC (5106); American Property Acquisitions I, LLC (9717); and American Property Acquisitions VII, LLC (3198). The Debtors’ corporate headquarters is 210 Barton Springs Road, Suite 300, Austin, Texas 78704. The Debtors’ service address is 2407 S. Congress Ave, Suite E-101, Austin, Texas 78704.

Introduction. This MOR is unaudited and does not purport to represent financial statements prepared in accordance with accounting principles generally accepted in the United States (“GAAP”), and it is not intended to fully reconcile to the consolidated financial statements prepared by the Debtors. Information contained in this MOR has been derived from the Debtors’ books and records, but does not reflect in all circumstances presentation for GAAP or SEC reporting purposes. Therefore, to comply with their obligations to provide MORs during these chapter 11 cases, the Debtors have prepared this MOR using the best information presently available to them, which has been collected, maintained, and prepared in accordance with their historical accounting practices. Accordingly, this MOR is true and accurate to the best of the Debtors’ knowledge, information, and belief, based on currently-available data. The results of operations and financial position contained herein are not necessarily indicative of results that may be expected for any period other than the period beginning on December 1, 2023 and ending December 31, 2023, or for the full year, and may not necessarily reflect the Debtors’ future consolidated results of operations and financial position.

Reservation of Rights. This MOR is limited in scope, covers the period beginning on December 1, 2023 and ending December 31, 2023, and has been prepared solely for the purpose of complying with the monthly reporting requirements of the Debtors’ chapter 11 cases. The unaudited financial information for this report has been derived from the Debtors’ books and records. The information presented herein has not been subject to all procedures that typically would be applied to financial information in accordance with U.S. GAAP. Upon the application of such procedures, the Debtors believe that the financial information could be subject to material change. The information furnished in this MOR includes normal recurring adjustments but does not include all of the adjustments that typically would be made for interim financial information presented in accordance with GAAP.

Basis of Presentation. Although the Debtors generally prepare their financial statements on a consolidated basis, the MOR has been prepared on an entity-by-entity basis (excluding most intercompany eliminations) for Debtors Core Scientific, Inc., Core Scientific Acquired Mining LLC, Core Scientific Operating Company, Core Scientific Mining LLC, Radar Relay, Inc., Core Scientific Specialty Mining (Oklahoma) LLC, American Property Acquisition, LLC, Starboard Capital LLC, RADAR LLC, American Property Acquisitions I, LLC, and American Property Acquisitions VII, LLC. The financial information contained herein is unaudited, limited in scope, covers a limited time period, and has been prepared solely for the purpose of complying with the monthly reporting requirements for chapter 11 debtors issued by the UST.

Accounting Principles. The Debtors maintain their financial records according to GAAP, however the MOR does not purport to represent financial statements prepared in accordance with GAAP, nor are they intended to be fully reconciled with the financial statements of the Debtors.

Currency. Unless otherwise indicated, all amounts in the MOR are reflected in U.S. dollars.

Consolidated Entity Accounts Payable and Disbursement Systems. Cash is received and disbursed by the Debtors as described in the Emergency Motion of Debtors for Entry of Interim and Final Orders (I) Authorizing Debtors to (A) Continue their Existing Cash Management System, (B) Maintain Existing Business Forms and Intercompany Arrangements, (C) Continue Intercompany Transactions, and (D) Continue Utilizing Employee Credit Cards; and (II) Granting Related Relief (Docket No. 12) (the “Cash Management Motion”) and the Debtors’ receipt and disbursement of cash is consistent with the Debtors’ historical cash management practices. Due to the consolidated cash management reporting system, certain cash payments may be paid out of a legal entity that is different than the legal entity at which the expenses were incurred. Also, certain cash receipts may be received in a different legal entity than the legal entity at which the accounts receivable is recorded. Disbursements attributed to each entity represent the entity on behalf of which payments were made, on a proportional allocated basis, from the consolidated cash management system.

Supporting Documentation. At the direction of the U.S. Trustee, the following schedules are attached to the MORs: (i) Statement of Cash Receipts and Disbursements; (ii) Balance Sheet; (iii) Income Statement (profit or loss statement); and (iv) Schedule of Payments to Insiders.

Part 1, Cash Receipts and Disbursements. Cumulative quarter-to-date for Q4 2023 disbursements are reported in the Cumulative figures in the MOR. Cumulative case to date total disbursements through December 31, 2023 are $538,296,326.

Part 2: Asset and Liability Status. Long-term lease liabilities resulting from the Debtors’ office / location leases and equipment / fixed asset leases are reported as prepetition unsecured debt. Beginning with the April MOR, the (i) April 2022 $60 million Bridge Promissory Note with BRF Finance Co, LLC and (ii) April 2022 $15 million Bridge Promissory Note with B. Riley Commercial Capital, LLC (collectively, the “Unsecured Bridge Notes”), are also reported as prepetition unsecured debt, whereas the Unsecured Bridge Notes were inadvertently included in prepetition priority debt on previous monthly operating reports.

Part 3, Assets Sold or Transferred. The Company regularly receives credits and/or coupons from Bitmain Technologies Ltd.’s reward and price protection programs. The Company subsequently redeems these credits and/or coupons for new ASIC miner acquisitions or sells them to third parties when they are not able to be utilized by the Company. The Company may recognize other income when the credits and/or coupons are redeemed in noncash acquisitions or sold to third parties.

Part 5: Professional Fees and Expenses. For purposes of the MORs, bankruptcy professional fees are considered approved if the applicable monthly fee statement has been served and the objection deadline with regard to such monthly fee statement has expired prior to the end date of the MOR period.

Part 7 Questionnaire. Pursuant to certain orders of the Bankruptcy Court entered in the Debtors’ chapter 11 cases (the “First Day Orders”), the Debtors were authorized (but not directed) to pay, among other things, certain prepetition claims of their employees, taxing authorities, insurers, critical vendors, and certain other prepetition creditors. Amounts paid pursuant to the First Day Orders are monitored as to limits provided in the applicable orders of the Bankruptcy Court governing payment of such prepetition obligations, and this report is available to the U.S. Trustee as required.

Description

Receipts

Operating Sales Proceeds

Bitmain Coupon Sales

Other Receipts

Total Receipts

Disbursements