Hut 8 Secures $1.07B Credit Line With 40% Liquidity Covenant

Hut 8 Corp. closed a four-year, $1.07 billion senior secured credit facility to support development of AI data centers, according to the company’s securities filing. The filing shows the facility closed on Sept. 24 and no amounts were outstanding at closing.

The agreement permits the borrower to draw cash loans or issue letters of credit from the same overall commitment to back development and construction obligations. A letter-of-credit sublimit within the $1.07 billion commitment can be used for interconnection deposits, utility and vendor obligations, and other site-development collateral, reducing the cash the company must post while projects are in early stages.

Hut 8 Corp. is named as borrower and certain restricted subsidiaries are guarantors. The credit agreement grants first-priority liens over substantially all assets of the borrower and guarantors, subject to standard exclusions. The filing notes the facility can bridge interim development needs while the company arranges longer-term, project-level financing.

Pricing for Term SOFR loans starts at a margin of 1.75 percentage points above the benchmark. The margin band can vary between 1.50 and 2.00 percentage points depending on the company’s debt-to-market-capitalization ratio. The agreement also restricts certain additional indebtedness and liens under defined conditions.

A key covenant requires Hut 8 to maintain liquidity equal to at least 40% of the facility’s commitments beginning with the quarter ending March 31, 2027, until a defined stabilization date. After that date the requirement falls to 25%, measured using the agreement’s liquidity definition and subject to available equity cure rights. The amount the company borrows or issues in letters of credit will determine the scale of secured obligations at the parent and guarantor level.

Hut 8 reported $233.6 million in cash on its June 30 balance sheet, with restricted funds listed separately. The company previously described roughly $7.5 billion of project financing for its River Bend and Beacon Point AI campuses as non-recourse project financing. The new corporate revolver provides a single source of bank capacity that can be used for cash drawdowns or to secure eligible obligations without immediate project-level debt.