Company: BTBT
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001213900-25-076608
Chunk: 178

Company: Bit Digital, Inc
Filing Date: 2025-08-14
Form: 10-Q
Item: Item 2
Chunk 178
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 Pursuant to the terms of the agreements, KaboomRacks provides maintenance
and operation services to Bit Digital to support 6 MW and 13 MW of capacity. On July 1, 2025, we entered into the first amendment to the
hosting service agreement for 13 MW of capacity. The amendment modified the existing agreement, identifying the two facilities that will
provide maintenance and operations service to Bit Digital to support 5 MW and 8 MW of capacity. KaboomRacks shall also be entitled to
respective 40%, 14.75% and 22.5% of the net profit generated by the miners. As of June 30, 2025, KaboomRacks provided approximately 4.5
MW of capacity for our miners at their facility.

50

In May 2022, our hosting partner Blockfusion advised
us that the substation at its Niagara Falls, New York facility was damaged by an explosion and fire, and power was cut off to approximately
2,515 of the Company’s bitcoin miners and approximately 710 ETH miners that had been operating at the site immediately prior to
the incident. The explosion and fire are believed to have been caused by faulty equipment owned by the power utility. Blockfusion and
the Company have entered into a common interest agreement to jointly pursue any claims evolving from the explosion and fire. Prior to
the incident, our facility with Blockfusion in Niagara Falls, provided approximately 9.4 MW to power our miners. Power was restored to
the facility in September 2022. However, we received a notice dated October 4, 2022 (the “Notice”), from the City of Niagara
Falls, which ordered the cease and desist from any cryptocurrency mining or related operations at the facility until such time as Blockfusion
complies with Section 1303.2.8 of the City of Niagara Falls Zoning Ordinance (the “Ordinance”), in addition to all other City
ordinances and codes. Blockfusion has advised us that the Ordinance came into effect on October 1, 2022, following the expiration of a
related moratorium on September 30, 2022. Blockfusion has further advised that it has submitted applications for new permits based on
the Ordinance’s new standards and that the permits may take several months to process. Pursuant to the Mining Services Agreement
between Bit Digital and Blockfusion dated August 25, 2021, Blockfusion represents, warrants and