Company: SLNH
Filing Date: 2025-02-05
Form Type: 424B3
Source: 0001493152-25-005030
Chunk: 313

Company: Soluna Holdings, Inc
Filing Date: 2025-02-05
Form: 424B3
Chunk 313
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 49% of the Class B Membership Interests. This investment can occur within 30 days after the Effective Date (treated equally to the initial Investor), from day 31 to 180 days after the Effective Date (subject to a purchase price formula with a 20% discount rate), or after 180 days with the initial Investor’s approval.

On May 16, 2024, the Company secured $ 1.0million in financing from SLC for equipment and machinery for Project Dorothy 2 through an Equipment Loan Agreement (the “ELA”) between SDI SL Borrowing - 1, LLC (the “Borrower”) and SLC. On that date, SLC lent the Borrower $ 720,000to purchase medium voltage cables and low voltage switchboards. This debt was later assigned to ComputeCo on the Effective Date. Subsequently, the Borrowing amount in full by issuing the Investor Class B Membership Interests in the Dorothy 2 project valued at three times the borrowing amount (i.e., $2.16 million).

The Company evaluated
this legal entity under ASC 810, Consolidations and determined that this is not a VIE. This entity is a VOE primarily due to there
being sufficient equity at risk to finance its activities, the equity holders as a group having the characteristics of a controlling financial
interest and the entity is not structured with non-substantive voting rights. The Company’s consolidation model is based on the
concept of power. Given the Company’s Class A membership interest, the Company has the ability to control the significant decisions
made in the ordinary course of the business of ComputeCo. Even though SLC has a majority of the Class B membership, the Company holds
all the Class A membership, which gives them the ability to control the significant decisions made in the ordinary course of business.
The non-controlling shareholders do not hold substantive participating rights, voting rights or liquidation rights. As of September 30,
2024, SLC owns 72% and SDI owns 28% of ComputeCo.

The carrying amount of the assets and liabilities was as follows for ComputeCo:

Schedule of Variable Interest Entities of Assets and Liabilities

| (Dollars in thousands)                 |     | September 
 30, 2024  |       |
|:---------------------------------------|:----|:----------|------:|
| Current assets:                        |     |           |       |
| Cash and restricted cash               |     | $         |