Company: SLNH
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001641172-25-001756
Chunk: 2312

Company: Soluna Holdings, Inc
Filing Date: 2025-03-31
Form: 10-K
Item: Item 8
Chunk 2312
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 Third Amendment on November
20, 2023 and the Fourth Amendment on February 28, 2024, see Note 8 for details. Inherent in a Black-Scholes simulation are assumptions
related to expected stock-price volatility, expected life, risk-free interest rate and dividend yield. The Company estimates the volatility
of its common stock warrants based on implied volatility from its traded warrants and historical volatility of select peers’ common
stock with a similar expected term of the Warrants. The risk-free interest rate is based on the U.S. Treasury zero-coupon yield on the
grant date with a maturity similar to the expected remaining term of the warrants. The expected term of the warrants is assumed to be
equivalent to their remaining contractual term. The dividend rate is based on the historical rate, which the Company expects to remain
at zero. The warrants were collectively classified as a Level 3 measurement within the fair value
hierarchy because these valuation models involve the use of unobservable inputs relating to the Company’s estimate of its expected
stock volatility which was developed based on the historical volatility of a publicly traded set of peer companies.

The
following table represents the significant fair value assumptions used for warrants issued or repriced during the years ended December
31, 2024 and 2023:

 Schedule
of Fair Value Assumptions For Warrants Issued

    2024  
    2023 
  
    Stock price 
    $ 2.43-4.07  
    $ 2.93- 5.00 
  
    Exercise price  
    $ 0.01-287.50  
    $ 0.01- 20.00 
  
    Expected term in years 
     0.53-8.77  
     1.16- 5.00 
  
    Expected dividend 
     0.00% 
     0.00%
  
    Volatility 
     105.0- 137.50% 
     108.50 – 140%
  
    Risk-free interest rate 
     3.51-4.44% 
     3.36- 5.25%

Following
the debt extinguishment on July 19, 2022 as noted further in Note 8, the Convertible Notes will be accounted for under the fair value
method on a recurring basis upon issuance (e.g., upon execution of the Addendum) per guidance within ASC 480, and