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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
WASHINGTON,
D.C. 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date
of Report (Date of earliest event reported): October 20, 2026
SOLUNA
HOLDINGS, INC.
(Exact name of Registrant as Specified
in Its Charter)
| Nevada |
|
001-40261 |
|
14-1462255 |
(State or Other Jurisdiction
of Incorporation) |
|
(Commission
File Number) |
|
(IRS Employer
Identification No.) |
325
Washington Avenue Extension
Albany,
New York |
|
12205 |
| (Address
of Principal Executive Offices) |
|
(Zip
Code) |
Registrant’s
Telephone Number, Including Area Code: (516) 216-9257
N/A
(Former
Name or Former Address, if Changed Since Last Report)
Check
the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under
any of the following provisions:
| ☐ | Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| | |
| ☐ | Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| | |
| ☐ | Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| | |
| ☐ | Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities
registered pursuant to Section 12(b) of the Act:
Title
of each class |
|
Trading
Symbol(s) |
|
Name
of each exchange on which registered |
| Common
stock, par value $0.001 per share |
|
SLNH |
|
The
Nasdaq Stock Market LLC |
| 9.0%
Series A Cumulative Perpetual Preferred Stock, par value $0.001 per share |
|
SLNHP |
|
The
Nasdaq Stock Market LLC |
Indicate
by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405
of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).
Emerging
growth company ☐
If
an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying
with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
Item
1.01. Entry into a Material Definitive Agreement.
On
October 20, 2026, Soluna Holdings, Inc. (the “Company”) and certain affiliates thereof entered into a Subscription Agreement
(as defined and discussed in further detail below) with certain affiliates of Applied Digital Corporation,
a Nevada corporation (“Applied”), to
form a jointly owned company to develop a planned 50 megawatt Critical I.T. data center for artificial intelligence and high-performance
computing at Project Dorothy 3, the Company’s development site near Silverton (Briscoe County), Texas, and the Briscoe Wind Farm.
The
Subscription Agreement
On
October 20, 2026, the Company entered into a Subscription Agreement (the “Subscription Agreement”) with Soluna HPC D3 STX
HoldCo, LLC, a Delaware limited liability company and an indirect wholly
owned subsidiary of the Company (“Soluna Investor”), Soluna STX Borrower HoldCo, LLC, a Delaware limited liability company
(“Soluna STX”), APLD Intermediate HoldCo, LLC, a Delaware limited liability company and direct, wholly owned subsidiary of
Applied (“Applied Guarantor”), APLD
STX Holdings LLC,
a Delaware limited liability company and an indirect wholly
owned subsidiary of Applied (“Applied Investor”), STX JV Holdings LLC, a Delaware limited liability company and an
indirect wholly owned subsidiary of Applied (the
“Project Company”), and Soluna DV Services, LLC, a Nevada limited liability company and wholly owned subsidiary of the Company
(the “Ground Lessee”). Pursuant to the Subscription Agreement, at the closing (the “Closing”) of the transactions
contemplated by the Subscription Agreement (the “Transactions”), Soluna Investor is obligated to subscribe for and acquire
common units representing 49% of the issued and outstanding membership interests of the Project Company, and Applied Investor is obligated
to subscribe for and acquire common units representing 51% of the issued and outstanding membership interests of the Project Company.
As consideration for issuance of Project Company common units to Soluna Investor, Ground Lessee, as landlord, and STX-01 LLC,
a wholly owned subsidiary of the Project Company,
as tenant, will enter into the Ground Sublease (as defined below), with an attributed value to Soluna Investor, pursuant to the Subscription
Agreement, of $18,750,000. Additionally, Soluna STX will contribute STX JV Intermediate Holdings, LLC, a newly formed holding company
and wholly owned subsidiary of Soluna STX, to the Project Company. As consideration for issuance of Project Company common units to Applied
Investor, Applied Investor will contribute to the Project Company an amount in cash equal to $19,515,306, subject to a dollar-for-dollar
credit against such amount for amounts actually paid by Applied Investor or its affiliates prior to the Closing for certain development
work performed at the site of the Project (as defined below) or the procurement of certain long lead-time equipment on behalf of the
Project Company. Soluna Investor’s and Applied Investor’s obligations under the Subscription Agreement are guaranteed respectively
by the Company and Applied Guarantor.
The
Closing is expected to occur on or before December 1, 2026 (the “Outside Date”), subject to the satisfaction or waiver of
certain conditions set forth in the Subscription Agreement, including: (1) the absence of any law, order or injunction enacted, issued
or in effect that restrains, enjoins, prohibits or otherwise prevents the Transactions, and the absence of any action instituted or threatened
in writing by a governmental authority that would reasonably be expected to prevent or prohibit the Transactions; (2) the occurrence
of the Tax Abatement Vote (as defined in the Subscription Agreement), (3) the accuracy, as of the Closing, of the representations and
warranties made by each party in the Subscription Agreement in all respects, except for such inaccuracies as are de minimis in nature
and amount relative to the applicable representation and warranty taken as a whole; (4) the performance or compliance by each party,
in all material respects, with all obligations and covenants required to be performed or complied with by it at or prior to the Closing;
(5) the negotiation, execution and delivery by each party thereto of the agreements and other documents required to be executed and delivered
at or prior to the Closing, including the LLC Agreement (defined below) and the Ancillary Agreements (as defined below) (collectively,
the “Transaction Documents”); (6) the requisite internal approvals by ChronoScale Holdings Corporation,
a Nevada corporation (“ChronoScale”), and
its applicable affiliate of the Data Center Lease (as defined below); (7) the requisite internal approvals by Applied, the Company and
each of their applicable affiliates of the Transaction Documents (including the LLC Agreement and the Ancillary Agreements); and (8)
the issuance of the Leasehold Title Policy (as defined in the Subscription Agreement) by the applicable title company. Either Soluna
Investor or Applied Investor may terminate the Subscription Agreement if the Closing has not occurred on or before the Outside Date,
except that if, as of such date, all conditions to the Closing have been satisfied or waived (other than those conditions that by their
nature are to be satisfied at the Closing and are then capable of being satisfied) other than the condition relating to (i) the Tax Abatement
Vote, then the Outside Date will automatically be extended, for one time only, by thirty (30) days, or (ii) the issuance of the Leasehold
Title Policy or delivery of Title Deliverables, then the Outside Date will automatically be extended, for one time only, by ten (10)
days, but in no event will the Outside Date extend beyond December 31, 2026.
As
of the date of this Current Report Form
8-K, certain development work related to the Project has begun at the site of the Project and will continue through the Closing, and
certain equipment necessary for the development of the Project may be procured, in each case, at the costs and expense of Applied (collectively,
the “Funded Costs”). If the Closing fails to occur and the Subscription Agreement is terminated, Soluna
Investor will be obligated to reimburse Applied
Investor for
eighty percent (80%) of such Funded Costs, up to a maximum of $45 million, subject to a reimbursement schedule and interest as specified
in the Subscription Agreement, which obligation is guaranteed by the Company.
The
LLC Agreement
In
connection with the Subscription Agreement and the Transactions, at Closing, Soluna Investor and Applied Investor will also enter into
an Amended and Restated Limited Liability Company Agreement of the Project Company (the “LLC Agreement”), setting forth the
terms and conditions of the ownership, management and operation of the Project Company. The purpose of the Project Company is to, among
other things, acquire, own, construct, develop, operate, manage, lease and monetize the initial phase of a data center facility known
as “Dorothy 3A,” consisting of approximately 75 megawatts of gross capacity, or 50 megawatts of Critical I.T. capacity, in
Briscoe County, Texas (the “Project”). The LLC Agreement is expected to
contain customary representations and warranties of the parties
thereto. The terms of the LLC Agreement, when finalized, may differ from those currently contemplated by the Subscription Agreement.
The
Lease Agreements
In
connection with the Subscription Agreement, the LLC Agreement and the Transactions,
at Closing, the Ground Lessee will enter into a 99-year Ground Sublease Agreement (the “Ground Sublease”) with STX-01 LLC,
a wholly-owned subsidiary of the Project Company (“Tenant”), pursuant to which Tenant will lease from the Ground Lessee,
all right, title and interest of Ground Lessee in the land leased under that certain Ground Lease to be entered into between Soluna Dorothy
3 Energy ServiceCo, LLC and Soluna DV BNSF Energy HoldCo, LLC (collectively, the “Fee Owner”), as landlords, and the Ground
Lessee, as tenant, covering certain real property located in Briscoe County, Texas (the “Fee Ground Lease”), upon which the
Project will be developed. The terms of the Ground Sublease and the Fee Ground Lease, when finalized, may differ from those currently
contemplated by the Subscription Agreement.
The
Warrant
The
Subscription Agreement contemplates that, at the Closing, the Company will issue to Applied or an affiliate thereof (the “Holder”)
in a private placement (“Private Placement”), a Common Stock Purchase Warrant (the “Warrant”) to purchase up
to 7,644,444 shares of the Company’s common stock, par value $0.001 per share (the “Common Stock”), at an exercise
price of $0.74 per share. The Warrant is anticipated to be exercisable at any time on or after the issue date and on or prior to the
seven-year anniversary thereof. The Warrant is anticipated to be subject to adjustment in the event of certain stock dividends and distributions,
stock splits, stock combinations, reclassifications or similar events affecting the Common Stock. In the event of certain corporate transactions,
the Holder is anticipated to be entitled to receive, upon exercise of the Warrant, the kind and amount of securities, cash or other property
that the holders would have received had they exercised the Warrant immediately prior to such transaction. The
Holder is expected to agree that, for the period beginning on the issue date and ending on the earlier of the twelve-month anniversary
thereof and the date on which the volume weighted average price of the Common Stock equals or exceeds $10.00 per share, it will not,
directly or indirectly, engage in any short sale of the Common Stock or otherwise hedge its economic exposure to the Common Stock.
The Warrant is not expected to entitle the holders thereof
to any voting rights or any of the other rights or privileges to which holders of Common Stock are entitled. The Warrant is expected
to be issued and sold without registration under the Securities Act of 1933, as amended (the “Securities Act”), or state
securities laws in reliance on the exemptions provided by Section 4(a)(2) of the Securities Act promulgated thereunder and in reliance
on similar exemptions under applicable state laws.
The
form of the Warrant has not been finalized as of the date of this Current Report Form
8-K, and the issuance of the Warrant is conditioned upon the occurrence of the Closing.
The
Registration Rights Agreement
The
Subscription Agreement contemplates that, at the Closing, the Company will enter into a Registration Rights Agreement (the “Registration
Rights Agreement”) with the Holder, pursuant to which the Company would agree to file a registration statement with the Securities
and Exchange Commission (the “SEC”) to
register the resale or other disposition of the Warrant and the shares of Common Stock issuable upon exercise of the Warrant (together,
the “Registrable Securities”). It is expected that the Company will be required to prepare and file a registration statement
with the SEC on or prior to 30
days following the Closing (the
“Filing Deadline”), and to have the registration statement declared effective as soon
as reasonably practicable but in no event later than 30
days of the Filing Deadline if the SEC does not review such registration statement. It is expected that the Company will also be required
to use its commercially reasonable efforts
to keep any such registration statement continuously effective until (i) the date that all of the Registrable Securities have been publicly
sold by the Holder, (ii) the date that all of the Registrable Securities have been previously sold in accordance with Rule 144 or (iii)
such time as all of such Registrable Securities may be sold by the Holder without any restriction pursuant to Rule 144, including holding
period, volume or manner-of-sale restrictions pursuant to Rule 144 and without the requirement for the Company to be in compliance with
the current public information requirement under Rule 144.
The
form of the Registration Rights Agreement has not been finalized as of the date of this Current Report
Form 8-K, and entry into the Registration Rights Agreement
is conditioned upon the occurrence of the Closing.
The
Ancillary Agreements
The
Subscription Agreement contemplates that, at or prior to the Closing, the parties, certain of their respective affiliates and certain
third parties will enter into a number of additional agreements (the “Ancillary Agreements”) as set forth in the Subscription
Agreement, including (i) the Fee Ground Lease, (ii) the Ground Sublease, (iii) a data center lease between Tenant, as landlord, and ChronoScale
or an affiliate thereof, as tenant, (the “Data Center Lease”), (iv) an engineering, procurement and construction contract
relating to the Project, (v) certain shared services agreements among the parties, (vi) assignment and assumption agreements with respect
to certain contracts relating to the Project, (vii) the Warrant, and (viii) the Registration Rights Agreement. Other than the form of
assignment and assumption agreement, the forms of the Ancillary Agreements have not been finalized as of the date of this Current
Report Form 8-K. During the period from the date
of the Subscription Agreement until the earlier of the Closing and the termination of the Subscription Agreement (the “Interim
Period”), the parties have agreed to use commercially reasonable efforts to negotiate in good faith to finalize the Ancillary Agreements.
The execution and delivery of the Ancillary Agreements in form and substance reasonably acceptable to the parties thereto, Soluna Investor
and Applied Investor and the requisite internal approvals by Applied, the Company and each of their applicable affiliates
of the Transaction Documents (including the LLC Agreement and the Ancillary Agreements) are conditions to each party’s obligation
to consummate the Closing, and the requisite internal approvals by ChronoScale and its applicable
affiliate are a condition to the obligations of Applied Investor and Applied Guarantor to consummate the Closing. If the
parties are unable to agree upon final forms of the Ancillary Agreements, the Closing may not occur. The terms of the Ancillary Agreements
and LLC Agreement, when finalized, may differ from those currently contemplated by the Subscription Agreement.
The
foregoing description of the Subscription Agreement is not complete
and is qualified
in its entirety
by reference to the full text of the Subscription Agreement. A copy of the executed Subscription Agreement is filed as Exhibit 10.1
to this Current Report on Form 8-K and is incorporated herein by reference.
Item
3.02 Unregistered Sales of Equity Securities.
The
information set forth in Item 1.01 of this Current Report on Form 8-K with respect to the Warrant and the shares of Common Stock underlying
the Warrant is incorporated by reference herein.
Safe
Harbor Statement
This
announcement contains forward-looking statements. These statements are made under the “safe harbor” provisions of the U.S.
Private Securities Litigation Reform Act of 1995. These forward-looking statements include all statements, other than statements of historical
fact, regarding the Company’s current views and assumptions with respect to future events regarding their respective businesses,
including the ability to complete the closing of the transactions contemplated by the Subscription Agreement on the proposed terms and
schedule, and the satisfaction of the conditions precedent to the closing of the transactions contemplated by the Subscription Agreement,
including approval of a tax abatement; the formation of the Project Company; the negotiation and execution of a definitive lease with
ChronoScale and definitive power supply agreements; the development, financing, construction, energization, and operation of the Project;
whether the development of the Project may be more difficult, time-consuming or costly than expected, whether the expected benefits of
the Project will occur, and the Company’s development pipeline. These forward-looking statements can be identified by terminology
such as “will,” “expects,” “anticipates,” “future,” “intends,” “plans,”
“believes,” “estimates,” “confident,” and similar statements. The Company may also make written or
oral forward-looking statements in their periodic reports filed with the SEC, in press releases and other written materials, and in oral
statements made by their officers, directors, or employees to third parties. Statements that are not historical facts, including but
not limited to statements about the Company’s beliefs and expectations, are forward-looking statements. Forward-looking statements
involve inherent risks and uncertainties, including but not limited to, failure to negotiate final forms of the Ancillary Agreements
in form and substance acceptable to Soluna Investor, Applied Investor and the parties thereto; failure to obtain the required approvals
of the Company, Applied and ChronoScale, and their applicable affiliates; failure to satisfy other closing conditions to the transaction
or to complete the transaction on anticipated terms and timing (or at all); the risk that the Company may be required to reimburse substantial
amounts to Applied Investor following a termination of the Subscription Agreement; risks that the Project may not obtain any required
regulatory approval; the risk that disruptions from the transaction will harm business plans and operations; significant transaction
costs, or difficulties in connection with the transaction and/or unknown or inestimable liabilities; restrictions during the pendency
of the transaction that may impact the ability to pursue certain business opportunities or strategic transactions; potential litigation
associated with the transaction; the occurrence of any event that could give rise to the termination of the proposed transaction; the
applicable company’s ability to complete construction of its data center campuses as planned; changes to AI and high performance
computing infrastructure needs and their impact on future plans; costs related to the high performance computing operations and strategy;
the applicable company’s ability to timely deliver any services required in connection with completion of installation under lease
agreements; the applicable company’s ability to raise additional capital to fund the ongoing datacenter construction and operations;
the applicable company’s dependence on principal customers; power or other supply disruptions and equipment failures; the inability
to comply with regulations, developments and changes in regulations; cash flow and access to capital; maintenance of third party relationships;
and conditions in the debt and equity capital markets. Further information regarding such risks and uncertainties is included in the
Company’s most recently filed Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q. All information provided in this
Current Report Form
8-K is as of the date of this Form 8-K, the Company undertakes no duty to update such information, except as required under applicable
law.
Item
9.01. Financial Statements and Exhibits
(d)
Exhibits.
| Exhibit No. |
|
Description |
| 10.1 |
|
Subscription
Agreement, dated as of October 20, 2026, by and among Soluna Holdings, Inc., Soluna HPC D3 STX HoldCo, LLC, Soluna STX Borrower HoldCo,
LLC, APLD Intermediate HoldCo LLC, APLD STX Holdings LLC,
STX JV Holdings LLC and Soluna DV Services, LLC. |
| 104 |
|
Cover
Page Interactive Data File (embedded within the Inline XBRL document). |
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, as amended, the registrant has duly caused this report to be signed on its
behalf by the undersigned hereunto duly authorized.
|
SOLUNA
HOLDINGS, INC. |
| |
|
|
| Date:
October 21, 2026 |
By: |
/s/
Michael Picchi |
| |
|
Michael
Picchi |
| |
|
Chief
Financial Officer |
| |
|
(principal
financial officer) |
