Company: SLNH
Filing Date: 2025-08-14
Form Type: 10-Q
Source: 0001641172-25-024045
Chunk: 5

Company: Soluna Holdings, Inc
Filing Date: 2025-08-14
Form: 10-Q
Item: Part I, Item 8
Chunk 5
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5.3 million,
of which $2.2 million was classified as current and $3.1 million was classified as non-current. As of December 31, 2024, the Company
had restricted cash of approximately $2.6 million, of which $1.1 million was classified as current and $1.5 million was classified as
non-current. Currently, the balance in restricted cash relates to restricted deposits held with customers that were for less than 12
months, or held for debt covenant purposes. The Company has a long-term restricted cash balance in relation to a collateralized deposit.

Deposits
and Credits on equipment

As
of June 30, 2025 and December 31, 2024, the Company had approximately $1.0 million and $5.1 million, respectively, in deposits and credits
on equipment that had not yet been received by the Company. Once the Company receives such equipment in a subsequent period, the Company
will reclassify such balance into Property, Plant and Equipment, net. Included in these balances was a credit on equipment of $975 thousand,
of which approximately $195 thousand has been used as of June 30, 2025, and the remaining $780 thousand will be restricted to be used
on future purchases for Project Dorothy 2 and Project Kati until September 1, 2025 (“expiration date”). The Company notes
that if an order is not executed by the expiration date, the credit would be forfeited. The Company intends to utilize the full credit
balance for future orders prior to the expiration date.

Debt
Issuance Costs

Debt
issuance costs consist of costs incurred in obtaining long-term financing. These costs are classified on the condensed consolidated balance
sheet as a direct deduction from the carrying amount of the related debt liability and subsequently amortized as interest expense in
the condensed consolidated statement of operations using the effective interest rate method.

The
Company evaluates amendments to its debt instruments in accordance with ASC 470-50, Debt - Modifications and Extinguishments (“ASC
470”) to determine whether the amendment should be accounted for as a modification or an extinguishment. An amendment may be considered
modified when the terms of the new debt and original instrument are not “substantially different” (as defined in the debt
modification guidance in ASC 470). Amendments that are considered modifications are accounted for prospectively as yield adjustments,
based on the revised terms, and lender fees and costs directly incurred