Company: BTBT
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110383
Chunk: 83

Company: Bit Digital, Inc
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 1
Chunk 83
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 State of Delaware, Complex Commercial Litigation Division, against
Blockfusion USA, Inc. (“Blockfusion”) alleging claims for breach of contract and related causes of action arising out of
a terminated mining services relationship. The Company initially sought in excess of $4.3 million, including: (i) the return of a $3.75
million investment made under the parties’ Mining Services Agreement; (ii) approximately $576,000 in payments made in reliance
on invoices the Company later determined to be fraudulent; and (iii) unpaid late development fees accruing at $9,375 per week. On October
22, 2024, Blockfusion denied the Company’s claims and filed counterclaims for reciprocal breach of contract and related relief.
Bit Digital denied Blockfusion’s claims.

Following
limited discovery, on June 18, 2025, the Court entered a stipulation and order amending the Case Management Order to extend multiple
discovery deadlines and vacate the previously scheduled trial date. On August 1, 2025, the Company moved for leave to file a Second Amended
Complaint, which adds claims for fraud and related causes of action arising out of Blockfusion’s conduct both at the inception
of and during the parties’ relationship. The Second Amended Complaint also names Blockfusion’s CEO, Alexander Martini-Lomanto,
as an additional defendant. The Company continues to seek the recovery of its original investment, invoice payments, and unpaid late
development fees, and now seeks additional damages for the tort and equitable claims contained in the Second Amended Complaint, including
punitive damages. The total amount of damages sought exceeds $5 million.

Blockfusion
has filed a motion to dismiss the Second Amended Complaint and a hearing on the motion has been scheduled for January 6, 2026. The Company
cannot yet estimate a reasonably possible range of loss or recovery.

Contingent
Consideration Liabilities

As
part of the Unifi Transaction (See Note 4. Acquisitions), the Company may be required to make additional contingent payments to
the seller based on the timing and availability of electric service to the property, as follows:

●A contingent payment of $8 million may become payable if, within two years of the acquisition date, the Company uses commercially reasonable efforts and obtains from the local energy provider an Electric Service Agreement for at least 99 megawatts (MW), or if the property otherwise receives 99MW of power within that timeframe.

●If an Electric Service