Company: SLNH
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010886
Chunk: 150

Company: Soluna Holdings, Inc
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 8
Chunk 150
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 This settlement did
not result in the admission of any liability on the part of SHI, whose declaratory judgment remains the subject of litigation.

11. Related Party Transactions

MeOH Power, Inc.

On December 18, 2013, MeOH Power, Inc. and the Company
executed a Senior Demand Promissory Note (the Note) in the amount of $380 thousand to secure the intercompany amounts due to the Company
from MeOH Power, Inc. upon the deconsolidation of MeOH Power, Inc. Interest accrues on the Note at the Prime Rate in effect on the first
business day of the month, as published in the Wall Street Journal. At the Company’s option, all or part of the principal and interest
due on this Note may be converted to shares of common stock of MeOH Power, Inc. at a rate of $0.07 per share. Interest began accruing
on January 1, 2014. The Company recorded a full allowance against the Note. As of March 31, 2025 and December 31, 2024, $389 thousand
and $385 thousand, respectively, of principal and interest are available to convert into shares of common stock of MeOH Power, Inc. Any
adjustments to the allowance are recorded as miscellaneous expense during the period incurred.

Employee Receivables

Certain employees have a receivable due to the Company
based on their stock-based awards, in which $108 and $178 was outstanding as of March 31, 2025 and December 31, 2024, respectively. The
balance is currently presented as $9 thousand and $82 thousand, respectively within Prepaid expenses and other current assets as of March
31, 2025 and December 31, 2024, and $99 thousand and $96 thousand, respectively within Other assets on the condensed consolidated financial
statements.

HEL Transactions

As discussed in the Company’s 2023
Annual Report and all agreements included as exhibits and defined within the 2023 Annual Report, on October 29, 2021, the Company
completed the Soluna Callisto acquisition pursuant to the merger agreement (the “Merger Agreement”). The purpose of the transaction
was for SCI to acquire substantially all of the assets (other than those assets physically located in Morocco) formerly held by Harmattan
Energy, Ltd. (“HEL”), which assets consisted of SCI’s existing pipeline of certain cryptocurrency mining projects that
HEL previously transferred to