Company: BTBT
Filing Date: 2025-11-14
Form Type: 10-Q
Source: 0001213900-25-110383
Chunk: 163

Company: Bit Digital, Inc
Filing Date: 2025-11-14
Form: 10-Q
Item: Item 1
Chunk 163
---
 financial position, results of operations and cash flows.

WhiteFiber’s
inability to resolve favorably any disputes that arise between WhiteFiber and Bit Digital with respect to their past and ongoing relationships
including potential conflicts of interests among management may adversely affect WhiteFiber’s operating results.

Certain
key management and directors of both Bit Digital and WhiteFiber hold the same or similar positions in both companies. Those positions
and their ownership of Bit Digital securities could create, or appear to create, potential conflicts of interest when WhiteFiber’s
management and directors and Bit Digital’s management and directors face decisions that could have different implications for Bit
Digital and WhiteFiber. Disputes may arise between WhiteFiber and Bit Digital in a number of areas relating to the various transaction
agreements, including:

    ●
    labor, tax, employee benefit,
    indemnification and other matters arising from WhiteFiber’s separation from Bit Digital;

    ●
    employee retention and
    recruiting;

    ●
    business combinations involving
    WhiteFiber; and

    ●
    the nature, quality and
    pricing of services that WhiteFiber and Bit Digital have agreed to provide each other.

WhiteFiber
may not be able to resolve potential conflicts, and even if it does, the resolution may be less favorable than if it were dealing with
an unaffiliated party.

The
agreements WhiteFiber enters into with Bit Digital may be amended upon agreement between the parties. While WhiteFiber is controlled
by Bit Digital, it may not have the leverage to negotiate amendments to these agreements if required on terms as favorable to it as those
it would negotiate with an unaffiliated third party.

As
an independent, publicly traded company, WhiteFiber may not enjoy the same benefits that its subsidiaries did as subsidiaries of Bit
Digital.

Historically,
WhiteFiber’s business has been operated through subsidiaries of Bit Digital, and Bit Digital performed substantially all the corporate
functions for their operations, including managing financial and human resources systems, internal auditing, investor relations, treasury
services, financial reporting, finance and tax administration, benefits administration, legal, and regulatory functions.

Bit
Digital provides support to WhiteFiber with respect to certain of these functions on a transitional basis. WhiteFiber will then need
to replicate certain facilities, systems, infrastructure and personnel to which it will no longer have access after the distribution
and will likely incur capital and other costs associated with developing and implementing its own support functions