Company: SLNH
Filing Date: 2025-05-15
Form Type: 10-Q
Source: 0001641172-25-010886
Chunk: 226

Company: Soluna Holdings, Inc
Filing Date: 2025-05-15
Form: 10-Q
Item: Part I, Item 2
Chunk 226
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 accredited investor named therein (the “Investor” and collectively, the “Note Parties), CloudCo issued
to the Investor a secured promissory note in a principal amount equal to $12.5 million (the “Note”).

On
March 23, 2025, the Note Parties entered into a Modification Agreement (the “Modification Agreement”) to, among other things,
(i) provide for the deposit of 1,000,000 shares (the “Escrow Shares”) of our common stock into an escrow account maintained
by Northland Securities, Inc., pursuant to an escrow agreement (as further described below), (ii) provide for the issuance to the Investor
of a warrant to purchase shares of our common stock upon the release by the Investor of its lien on our property, (iii) amend the payment
schedule of the Note to provide (a) for each of the six scheduled payments occurring after the earlier of the effectiveness of a registration
statement for the resale of the Registrable Securities (as defined below) or the date that the Registrable Securities may be sold pursuant
to Rule 144 under the Securities Act of 1933, as amended (the “Securities Act”), without any information requirements, the
amount of principal and interest payable on such date shall be reduced by 50% (the aggregate amount of the six months of such reductions,
the “Specified Amount”) and (b) if the aggregate amount of payments on the Note applied from the proceeds of the sale of the
Escrow Shares on or prior to the last six scheduled payments is less than the Specified Amount (such difference, the “Make Whole
Amount”), than the amount of each of the remaining scheduled payments shall be increased by an amount equal to the Make Whole Amount
divided by the number of remaining scheduled payments, (iv) modify the Note such that the Note is now convertible into up to 2,500,000
shares (the “Conversion Shares”) of our common stock based on a conversion price of $5.00, (v) amend the Note to provide that
we will be a direct co-obligor with CloudCo under the Note, and (vi) amend the SPA to allow us to organize or incorporate any subsidiary,
over which we shall have voting or beneficial control, which is being formed with the intent to engage in a business or line of business
substantially similar to that of Soluna Cloud or the Company, without first paying all of the principal and interest due