Benzinga | Oct 22, 2021 06:25AM EDT

Mawson Infrastructure 8-K Shows Co.'s MIG No. 1 Australian Subsidiary Entered Electricity Supply, Sale Deal With Cape Byron Mgmt. To Enable Co. To Operate Its First Australian Bitcoin Mining Site

On October 22, 2021, MIG No. 1 Pty Ltd ("MIG"), an Australian subsidiary of Mawson Infrastructure Group Inc. (the "Company"), entered into an electricity supply and sale agreement ("Electricity Supply Agreement") with Cape Byron Management Pty Ltd ("CBM") to enable the Company to operate its first Australian bitcoin mining site ("Australian Site"). CBM is a subsidiary of Quinbrook Infrastructure Partners Pty Ltd.



The main terms of the Electricity Supply Agreement include:



Certain conditions precedent to be satisfied as outlined in clause 2 of the ? Electricity Supply Agreement. It is currently contemplated that all condition precedent will be satisfied by January 2022;



CBM is to complete all infrastructure works for the Australian Site (at its ? cost) at agreed times. Liquidated damages of $9,375 per day for each Modular Data Centre that is not generated by the date set out in clause 7.1 of the agreement must be paid by CBM to MIG for any delays in completion;



? CBM to supply and sell to MIG an agreed quantity of electricity at different intervals for an agreed price at each interval;



MIG will construct, own, operate and maintain the MDC Connection ? Infrastructure (as that term is defined in the Electricity Supply Agreement) on the Australian Site;



The term of the Electricity Supply Agreement is 7 years (2 x 3.5 year ? terms); provided that MIG may terminate the agreement upon 12 months written notice to CBM;



There is a profit-sharing arrangement whereby MIG will pay CBM 10% of the ? Net Bitcoin Revenue (as that term is defined in the Electricity Supply Agreement) generated by MIG through the operations on the Australian Site;



In each year during the Supply Term, MIG must (a) take electricity at the Termination Point offered to it at no less than the Minimum Transfer Capacity and (b) MIG agrees to take an aggregate amount of electricity ? equal to or greater than the Annual Compensation Threshold. MIG agrees to pay CBM cash for any shortfall.



? MIG will pay to CBM monthly supply charges described as ?MIG Charges? (as that term is defined in the Electricity Supply Agreement);



MIG grants to CBM a ?security interest? to secure the payment obligations ? of MIG up to the amount of AUD3,657,000, which is subordinated to any security interested granted by MIG to a third party lender;



If the Electricity Supply Agreement is terminated early, an ?Early ? Termination Amount? will be calculated by the non-defaulting party and payable by the defaulting party.