Company: SLNH
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023503
Chunk: 164

Company: Soluna Holdings, Inc
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 164
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 on extinguishment 

     (551) 
     - 
  
    Total outstanding debt 

    $-  
    $1,202 

    *
    On
    March 14, 2025, the Company satisfied the assignment and assumption agreement, as such a gain on extinguishment was recorded.

On
July 12, 2024, the Company, CloudCo, Soluna Cloud, and the Investor entered into a First Amendment to the Note Purchase Agreement (the
“June SPA Amendment”). This amendment allows CloudCo to issue additional secured promissory notes totaling $1.25 million
(the “Additional Notes”) to new accredited investors (the “Additional Investors”). These Additional Notes are
subject to the same terms and conditions as the June SPA financing.

To
further incentivize the Additional Investors, Soluna Cloud issued warrants (the “Cloud Additional Warrants”) to each Additional
Investor. These Cloud Additional Warrants are exercisable within three years from the effective date of the June SPA Amendment. They
allow the purchase of a number of shares of Soluna Cloud common stock equal to 1.25% of Soluna Cloud’s issued and outstanding common
stock as of the Cloud Additional Warrant date, divided by 0.9875, plus 1.25% of each Qualified Issuance, divided by 0.9875. On July 12,
2024, the Company determined that the additional warrants were treated as a warrant liability and based on valuation, the Company booked
a warrant liability of approximately $13 thousand and a related debt discount which will be amortized over the life of the loan. Further
evaluation of the Warrants under ASC 815-10 was required to determine if the warrants meet the definition of a derivative. The warrants
are classified as a liability that are required to be adjusted to fair market value. The Company applied a discounted cash flow method
in relation to the valuation of Cloud which assumptions from forecasted projected cash flow data and other key operating assumptions
such as working cash flow were used to determine an enterprise value less any current debt in order to determine an equity value for
Cloud. As of September 30, 2025 and December 31, 2024, the warrants were fair valued, and deemed to not have any further value, as such
the Company wrote down the liability balance to $0.

A
“Qualified Issuance” includes any issuance of common stock by Soluna Cloud from the day after