SOLUNA HOLDINGS, INC: entering into a material definitive agreement, creating a direct financial obligation or obligation under an off-balance sheet arrangement of a registrant, unregistered sale of equity securities, other events, financial statements and exhibits (Form 8-K)

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Section 1.01 Entering into a Material Definitive Agreement.

As indicated previously, the October 25, 2021, Soluna Holdings, Inc.(the “Company”) entered into a securities purchase agreement (the “October SPA”) pursuant to which the Company issued to the purchasers listed therein (the “October Purchasers”) secured convertible notes an initial aggregate principal amount of $16,304,348 (the “October Bonds”) and warrants to purchase common shares of Class A, Class B and Class C (the “October Warrants”) to purchase up to an aggregate of 1,776,073 shares shares of the Company, par value
$0.001 per share (the “Common Shares”). The obligations under the October SPA are secured by a guarantee agreement dated October 25, 2021 (the “October Security Agreement”) which granted LLC Warranty Services (the “Collateral Agent”) a security interest in the assets of the Company and its subsidiaries.

Also, as mentioned earlier, on July 19, 2022the Company has entered into an addendum with the Warranty Agent and October Buyers to vary certain terms of the October SPA and October Warranty Agreement (the “Addendum”), including the terms of the October Notes and October Warrants.

On September 13, 2022, the Company and the October Buyers have entered into an agreement further amending the Addendum (the “Addendum Addendum”) pursuant to which, as of such date, the First Deposit, such as this term and other Capitalized terms not otherwise defined herein are defined in the SPA October Addendum, delivered to the Company. Also in accordance with the amendment of the addendum, at the latest October 17, 2022the Company must file $1,000,000 in escrow as the third deposit, the Company will not be required to make the second deposit or repay the first tranche of the October Notes and the first reconciliation date has been extended to October 12, 2022. In addition, pursuant to the Addendum, the Company issued to the October Purchasers 430,564 common shares (“New Shares”) in exchange for the Class B Warrants and four (4) New Warrants, Warrants subscription for Class D common shares to purchase up to an aggregate of 1,000,000 common shares at an exercise price of $3.50 per share, Class E common stock purchase warrants to purchase up to an aggregate of 1,000,000 common shares at an exercise price of $4.50 per share, Class F common stock purchase warrants to purchase up to an aggregate of 1,000,000 common shares at an exercise price of $5.50 per share, and Class G common stock purchase warrants to purchase up to an aggregate of 1,000,000 common shares at an exercise price of $7.50 per share (together, the “New BSAs”).

The Addendum Amendment also extended the maturity date of the October Bonds by six months to April 25, 2023and increased the principal amount of the October Notes by a total of $520,241 for a total principal amount outstanding of
$13,006,022. Also in accordance with the amendment to the Addendum, at any time on or before
October 17, 2022October buyers have the option to convert up to
$1,000,000 October Notes into common stock at a conversion price of $2.2186 per share.

Also, as mentioned earlier, on July 19, 2022 the Company and an accredited investor (the “Series B Holder”) entered into this securities purchase agreement (the “Series B Preferred Share SPA”) pursuant to which the Company issued to the Series B holder Series B Convertible Preferred Shares of the Company (the “Series B Preferred Shares”), pursuant to which the Company shall not issue, enter into an agreement to issue or announce the issue or proposed issue of common stock or of common stock equivalents (as defined in Series B Preferred Shares SPA), preferred stock or shares of the Company at a price or effective price less than the highest price per share of the securities issued or capable of being issued pursuant to Series B SPA Preferred Shares. In connection with the Amendment to the Addendum and the issuance of Common Shares and New Warrants thereunder, the September 13, 2022, the Company has entered into a consent with the Series B Holder (the “Series B Consent”) pursuant to which the Series B Holder has consented to the Company entering into and performing its obligations under the Addendum and the issuance of all Common Shares and Common Share Equivalents thereunder, has acknowledged and agreed that the undertaking and performance by the Company of its obligations under the Amendment to the Addendum and any related documents will not constitute a default or event of default under the Series B Preferred Share SPA or any of the related documents. Also pursuant to the Series B consent, the Company issued common stock purchase warrants to the Series B holder, on the same terms and conditions as the new warrants, to purchase an aggregate of 400,000 common shares comprised of Class D common shares purchase warrants to purchase up to an aggregate of 100,000 common shares at an exercise price of $3.50 per share, Class E common stock purchase warrants to purchase up to an aggregate of 100,000 common shares at an exercise price of $4.50 per share, Class F common stock purchase warrants to purchase up to an aggregate of 100,000 common shares at an exercise price of $5.50 per share, and Class G common stock purchase warrants to purchase up to an aggregate of 100,000 common shares at an exercise price of $7.50 per share.

The foregoing does not purport to be a complete description of the Amendment to the Series B Addendum, New Warrants and Consent, and is qualified in its entirety by reference to the full text of these documents, the forms of which are filed as Exhibit 4.1, 4.2, 4.3, 4.4, 10.1 and 10.2 to this current report on . . .

Item 2.03 Creation of a Direct Financial Obligation or Obligation Under an Off-Balance Sheet Arrangement of a Registrant.

The applicable information set forth in Section 1.01 of this Report on Form 8-K with respect to the Amendment to the Addendum is incorporated by reference into this Section 2.03.

Item 3.02 Unrecorded Sales of Equity securities.

The applicable information set forth in Section 1.01 of this Form 8-K is incorporated by reference into this Section 3.02. The New Shares and New Warrants have been issued without registration under the Securities Act of 1933, as amended (the “Securities Act”), based on the exemption from registration granted by Section 4(a)( 2) of the Securities Act and/or Rule 506 promulgated thereunder.

Item 8.01 Other Events


On September 13, 2022, the Company issued a press release announcing that it had entered into the Amendment. A copy of the press release is filed as Exhibit 99.1 to this Form 8-K and is incorporated into this Section 8.01 by reference.

This Form 8-K and Exhibit 99.1 contain forward-looking statements. Forward-looking statements include, but are not limited to, statements that express the Company’s intentions, beliefs, expectations, strategies, predictions, or any other statements relating to the Company’s future business, or events or future conditions. These statements are based on current expectations, estimates and projections regarding the Company’s business, based, in part, on assumptions made by its management. These statements are not guarantees of future performance and involve risks, uncertainties and assumptions that are difficult to predict. Therefore, actual results may differ materially from what is expressed or anticipated in forward-looking statements due to numerous factors, including risks that may be included in the documents that the Company files from time to time with the SECOND. All forward-looking statements speak only as of the date they are made, and the Company undertakes no obligation to update any forward-looking statement to reflect events or circumstances after the date of this Form 8-K. except as required by law. .

Section 9.01. Financial statements and supporting documents


(d) Exhibits



Exhibit No. Description
  4.1         Form of Class D Common Stock Purchase Warrant
  4.2         Form of Class E Common Stock Purchase Warrant
  4.3         Form of Class F Common Stock Purchase Warrant
  4.4         Form of Class G Common Stock Purchase Warrant
  10.1        Form of Addendum Amendment by and between the Company and the
            signatories thereof, dated September 13, 2022
  10.2        Form of Series B Consent by and between the Company and the
            signatory thereof, dated September 13, 2022
  99.1        Press Release of Soluna Holdings, Inc., dated September 13,
            2022.
104         Cover Page Interactive Data File (embedded within the Inline XBRL
            document)

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