Company: SLNH
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001493152-25-023503
Chunk: 203

Company: Soluna Holdings, Inc
Filing Date: 2025-11-14
Form: 10-Q
Item: Part I, Item 8
Chunk 203
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 with Soluna SLC Fund I Projects Holdco, LLC,
a Delaware limited liability company (“Spring Lane”) that is wholly owned indirectly by Spring Lane Management LLC. The Project
Company was constructing a modular data center with a peak demand of 25 MW (the “Dorothy Phase 1A Facility”).

Under
a series of transactions in February 2023 and March 2023, culminating in the March 10, 2023 Purchase and Sale Agreement, the Company
sold to Spring Lane certain Class B Membership Interests for a purchase price of $7.5 million (the “Sale”). After giving
effect to the Sale, the Company owned 6,790,537 Class B Membership Interests (constituting 14.6% of the Class B Membership Interests)
and Spring Lane owns 39,791,988 Class B Membership Interests (constituting 85.4% of the Class B Membership Interests). The cash portion
of the purchase price paid by Spring Lane to the Company was approximately $5.8 million, which represented the purchase price of $7.5
million less the Company’s pro rata share of certain contributions funded entirely by Spring Lane in the earlier portion of this
series of transactions occurring during February 2023 and March 2023. As a further part of these transactions, the parties agreed that
from January 1, 2023 onwards, the Company would bear only 14.6% of the costs relating to the construction and operation of the Dorothy
Phase 1A Facility, compared to its 67.8% share until that time, including during the calendar year 2022. After Spring Lane Capital realizes
an 16% Internal Rate of Return hurdle on its investments, the Company retains the right to 50% of the profits on DVSL. In connection
with the Spring Lane transactions and agreements, Soluna DV Services, LLC. will be providing the operations and maintenance services
to DVSL. DVCC expects to receive a margin of 20% for services rendered on certain expenses.

Concurrently
with the Sale, the Company, Spring Lane, Devco and the Project Company entered into (a) the Fourth Amended and Restated Limited Liability
Company Agreement of the Project Company, dated as of March 10, 2023 (the “Fourth A&R LLCA”), an amendment and restatement
of the Third Amended and Restated Limited Liability Company Agreement of the Project Company dated as of