1. What did Celsius announce on July 13th?
Celsius initiated a financial restructuring process to provide the company with the best opportunity to stabilize the business and consummate a comprehensive restructuring transaction that maximizes value for all stakeholders.
To implement the restructuring, Celsius and certain of its affiliates filed voluntary petitions for reorganization under Chapter 11 of the U.S. Bankruptcy Code in the United States Bankruptcy Court for the Southern District of New York.
2. What is Chapter 11? Why did the company file for Chapter 11?
Chapter 11 is a process in the U.S. through which a company can restructure its financial obligations.
Celsius initiated a financial restructuring to stabilize the business and maximize value for all stakeholders. Acting in the best interest of our stakeholders, including our entire customer community, is our top priority.
3. What does the future hold?
Our intention is for this process to maximize value for all stakeholders. It also is our goal to position Celsius to emerge as a stronger company.
This process will give us the best opportunity to consummate a comprehensive restructuring transaction that maximizes value for all stakeholders.
4. When will customers be able to withdraw assets?
On June 12, 2022, we made the difficult but necessary decision to pause withdrawals, Swap, and transfers on our platform to stabilize our business and protect our customers.
Most account activity will be paused until further notice.
5. Will users continue to earn rewards through the Chapter 11 process?
At this time, reward accruals are paused and customers will not be receiving reward distributions.
6. How can I obtain a Proof of Funds statement?
Users can log into their Celsius Accounts at any time to view their account information and the amount of assets owed to you. While a Proof of Funds request may be made from our website, please note that the company is experiencing a high volume of such requests and that a response to a request may take longer than usual.
7. Should customers delete the Celsius app/delete or disable their accounts?
We encourage customers to maintain their Celsius accounts and apps at this time.
8. What does this mean for vendors?
Vendor payments going forward will depend on when goods or services were provided to Celsius.
Goods or services provided from July 13th on are considered “post-petition” and will be paid in the normal course. In fact, we are required by the Court to pay all of our post-petition obligations as they come due.
Goods or services provided before the filing date are considered “pre-petition” and cannot be paid without the Court’s permission. Treatment of pre-petition obligations are generally determined at the end of the Chapter 11 case.
9. Where can stakeholders find more information about the process?
Additional information about the Chapter 11 filings, including Court documents, can be found at https://cases.stretto.com/celsius. Customers with questions about the process may call the Company’s Claims Agent, Stretto, at +1 (855) 423–1530 (U.S.) or +1 (949) 669–5873 (international) or email celsiusinquiries@stretto.com.
Loans
PLEASE TAKE NOTICE
As more fully explained in our blog, Celsius and certain affiliates have filed voluntary petitions for Chapter 11 Bankruptcy relief to stabilize our business and implement a restructuring that maximizes value for all stakeholders. For general information, please visit this website.
10. What does this mean for customer loans?
Functionality within the mobile and web apps to close, pay interest, or post additional assets for a loan has been disabled. Existing loans will continue to accrue contract interest.
At this time, margin calls and liquidations have been paused, including for loans that reach maturity or where the loan-to-value ratio (LTV) exceeds the loan’s liquidation threshold. Please note that it is possible that this pause may end at a later date. If that occurs, we may not be able to provide you with advanced notice if the pause ends, although we will attempt to do so if possible. Accordingly, this section of our FAQs is being provided only to inform you of the current status of margin calls and liquidations, and this FAQ should not be relied upon as a guarantee that the current pause will continue indefinitely. As such, we strongly encourage you to check for updates regarding the Chapter 11 proceedings shared through our official channels.
Celsius is not issuing new loans at this time.
11. How do I resolve a margin call?
At this time, margin call and liquidation activities have been paused with respect to matured loans, as well as to loans where the loan-to-value ratio (LTV) exceeds that loan’s liquidation threshold. Please note that these measures may change at a later date. Celsius will not restart loan liquidations and margin calls without Court approval.
12. How do I add more collateral?
At this time, Celsius has paused margin call and liquidation activities and disabled functionality within the mobile and web apps to post additional assets for loans at this time. Please note that these measures may change over time. Celsius will not restart loan liquidations and margin calls without Court approval.
13. How do I pay off my loan in fiat?
If you choose to repay and close an existing loan, you can do so only by wire transfer in US dollars. Digital assets currently reflected in your Celsius Account cannot be used to repay a loan at this time.
Before sending a wire to Celsius, please note that all withdrawals, Swap, and transfers between accounts continue to be paused. Any assets unlocked when you repay and close an existing loan are subject to the pause.
If you wish to repay and close an existing loan, you may do so by contacting us at loans@celsius.network for more information regarding the process.
14. Can I refinance my loan?
Refinancing of loans is not available at this time.
15. I have more questions, what should I do?
For more assistance, please direct your inquiries to loans@celsius.network.
Disclaimer:
This communication does not constitute an offer or solicitation to buy any securities, and shall not constitute an offer or sale in any jurisdiction in which such offer or sale would be prohibited. Any offers, solicitations or offers to buy, or any sales of securities will be made in accordance with the registration requirements of the Securities Act of 1933, as amended (“Securities Act”).
Earn accounts have not been registered under the Securities Act and may not be offered or sold in the United States, to U.S. persons, for the account or benefit of a U.S. person or in any jurisdiction in which such offer would be prohibited.
This communication contains “forward-looking statements”. which involve risks and uncertainties. You should not place undue reliance on forward-looking statements because they are subject factors which are difficult to predict. These forward-looking statements are generally identified by the use of “anticipate,” “believe,” “could,” “estimate,” “expect,” “intend,” “may,” “plan,” “target,” “will,” “would” and similar expressions. Risks and uncertainties include, but are not limited to: anticipated trends and challenges in our business and the regulation of digital asset offerings. We do not undertake to update any forward-looking statement as a result of new information or future events or developments.
