Company: SLNH
Filing Date: 2025-03-31
Form Type: 10-K
Source: 0001641172-25-001756
Chunk: 291

Company: Soluna Holdings, Inc
Filing Date: 2025-03-31
Form: 10-K
Item: Item 1A
Chunk 291
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 are currently in litigation with NYDIG regarding the default on a series of loans made by NYDIG to
Borrower pursuant to the MEFA that were secured by certain assets of Borrower and guaranteed by Guarantor pursuant to a written guaranty
agreement executed by Guarantor. On February 23, 2023, NYDIG proceeded to foreclose on all of the collateral securing the MEFA. Additionally,
we recently entered into a settlement agreement with Atlas Technology Group LLC (“Atlas”) and Soluna MC LLC (“Soluna
MC”), SCI, and Soluna Holdings, Inc. (collectively, the “Atlas Defendants”). In September 2023, Atlas filed a complaint
against the Atlas Defendants regarding a co-location services agreement. Atlas alleged, among other claims, that Soluna MC’s termination
of the agreement was a breach. On June 25, 2024, Atlas and the Atlas Defendants entered into a settlement agreement. Adverse outcomes
in any current or future proceedings that we are involved in or claims against us could result in significant liabilities, monetary damages,
fines, or injunctive relief, which may materially impact our financial condition, results of operations, or cash flows. Additionally,
the uncertainty surrounding litigation and the potential for adverse publicity related to such matters could harm our reputation and brand
image, affecting customer confidence and investor perception.

If we fail to maintain
effective internal controls, we may not be able to report financial results accurately or on a timely basis, or to detect fraud, which
could have a material adverse effect on our business or share price.

As a public company, we are
required to maintain internal control over financial reporting and to report any material weaknesses in those controls. A material weakness
is defined as a deficiency, or combination of deficiencies, in internal control over financial reporting such that there is a reasonable
possibility that a material misstatement of annual or interim financial statements will not be prevented or detected and corrected on
a timely basis.

37

Our management evaluated
the effectiveness of our disclosure controls and procedures as defined in Rule 13a-15 and 15d-15(e) under the Exchange Act, as of December
31, 2024. Based on this evaluation, our Chief Executive Officer and Chief Financial Officer have concluded that our disclosure controls
and procedures were effective at a reasonable assurance level as of December 31, 2024. See “Item 9A Controls and Procedures.”

Effective internal controls
are necessary for us to provide reasonable assurance with