XML 40 R20.htm IDEA: XBRL DOCUMENT
v3.26.1

Commitments and Contingencies | 12 Months Ended
--- | ---
Dec. 31, 2025
Commitments and Contingencies Disclosure [Abstract] |
Commitments and Contingencies | Commitments and Contingencies Commitments: Leases The Company determines whether an arrangement is a lease at inception. The Company has operating and financing leases for certain manufacturing, land, office facilities and certain equipment. The leases have remaining lease terms of two years to less than twenty-two years. Our lease agreements do not contain any material residual value guarantees or material restrictive covenants. Lease expense for these leases is recognized on a straight-line basis over the lease term. For the twelve months ended December 31, total lease costs are comprised of the following:
(Dollars in thousands) |  |  |
| 2025 |  | 2024
Operating lease cost | $ | 82 |  |  | $ | 157 |
Short-term lease cost | 50 |  |  | — |
Finance lease costs: |  |  |
Amortization of right of use assets | 57 |  |  | — |
Interest on lease liabilities | 71 |  |  | — |
Total finance lease costs | 128 |  |  | — |
Total net lease cost | $ | 260 |  |  | $ | 157 |
Short-term leases are leases having a term of twelve months or less. The Company recognizes short-term leases on a straight-line basis and does not record a related lease asset or liability for such leases. On April 3, 2025, Soluna KK Energy ServiceCo, LLC (“Soluna KK Energy”), a subsidiary of the Company, entered into a lease agreement for 50 acres of property located in Willacy County, Texas, for the purpose of constructing, installing, operating, and maintaining modular data centers and related facilities. Soluna KK Energy had the ability to terminate the lease within six months of April 3, 2025. Through July 2025, there was uncertainty over project funding and whether the Company would extend the lease agreement. As such, the Company recorded the lease agreement as short-term. In August 2025, Soluna KK Energy extended the lease agreement for the additional term of twenty-two years. Accordingly, the Company recorded a right-of-use asset and lease liability. Supplemental cash flows information related to leases for the twelve months ended December 31 was as follows:
(Dollars in thousands) |  |  |
| 2025 |  | 2024
Cash paid for amounts included in the measurement of lease liabilities: |  |  |
Operating cash flows from operating leases | $ | 82 |  |  | $ | 159 |
Operating cash flows from financing leases | $ | 118 |  |  | $ | — |
Non-Cash Activity Right-of-use assets obtained in exchange for lease obligations: |  |  |
Operating leases | $ | — |  |  | $ | 146 |
Finance leases | $ | 2,303 |  |  | $ | — |
Supplemental balance sheet information for the twelve months ended December 31 was as follows:
(Dollars in thousands, except lease term and discount rate) |  |  |
| 2025 |  | 2024
Assets |  |  |
Operating lease ROU asset | $ | 252 |  |  | $ | 313 |
Finance lease asset, net | 2,246 |  |  | — |
Total lease assets | $ | 2,498 |  |  | $ | 313 |
Liabilities |  |  |
Current operating lease liabilities | $ | 65 |  |  | $ | 61 |
Current finance lease liabilities | 20 |  |  | — |
Non-current operating lease liabilities | 187 |  |  | 252 |
Non-current financing lease liabilities | 2,236 |  |  | — |
Total lease liabilities | $ | 2,508 |  |  | $ | 313 |
Weighted Average Remaining Lease Term (in years): |  |  |
Operating leases | 5.05 |  | 5.71
Finance leases | 21.33 |  | — |
Weighted Average Discount Rate: |  |  |
Operating leases | 9.50 | % |  | 7.65 | %
Finance leases | 11.00 | % |  | — | %
Maturities of operating and finance lease liabilities are as follows for the year ending December 31: (Dollars in thousands)
| Operating leases |  | Finance leases |  | Total
2026 | $ | 82 |  |  | $ | 231 |  |  | $ | 313 |
2027 | 82 |  |  | 237 |  |  | 319 |
2028 | 29 |  |  | 244 |  |  | 273 |
2029 | 29 |  |  | 250 |  |  | 279 |
2030 | 29 |  |  | 257 |  |  | 286 |
Thereafter | 59 |  |  | 5,299 |  |  | 5,358 |
Total lease payments | 310 |  |  | 6,518 |  |  | 6,828 |
Less: imputed interest | (58) |  |  | (4,262) |  |  | (4,320) |
Total lease obligations | 252 |  |  | 2,256 |  |  | 2,508 |
Less: current obligations | (65) |  |  | (20) |  |  | (85) |
Long-term lease obligations | $ | 187 |  |  | $ | 2,236 |  |  | $ | 2,423 |
As of December 31, 2025, there were no additional operating lease commitments that had not yet commenced. Project Kati Commitments: As of December 31, 2025, the Company was contractually committed for approximately $27.0 million of capital expenditures, primarily related to infrastructure builds, equipment procurement, and labor mainly associated with the Company’s Project Kati data center. These capital expenditures are expected to occur over the next year. Contingencies: Spring Lane Capital Contingency The Company has a potential contingency associated with an agreement with Spring Lane of up to $250 thousand which would be reduced by a proportion of funding received from Spring Lane up to the $45.0 million aggregate contribution cap. The Company considers the probability of a payment for the contingency to be remote. Legal We are subject to legal proceedings, claims and liabilities which arise in the ordinary course of business. When applicable, we accrue for losses associated with legal claims when such losses are probable and can be reasonably estimated. These accruals are adjusted as additional information becomes available or circumstances change. Legal fees are charged to expense as they are incurred. On December 29, 2022, NYDIG filed a complaint against the NYDIG Defendants regarding the NYDIG Loans made by NYDIG to Borrower pursuant to a Master Equipment Finance Agreement, dated December 30, 2021, that were secured by certain assets of Borrower and guaranteed by Guarantor pursuant to a written guaranty agreement. The NYDIG Defendants s and NYDIG entered into a Stipulation and Agreed Judgment which was approved by the Court on February 23, 2024, whereby judgment was granted to NYDIG on the counts in the complaint and the NYDIG Defendants became jointly and severally liable for an aggregate amount of approximately $9.2 million plus interest (the “Agreed Judgment Amount”). On September 29, 2025, the NYDIG Defendants and NYDIG entered into a Settlement Agreement (the “Settlement Agreement”), pursuant to which the NYDIG Defendants and NYDIG agreed to fully settle and resolve the Agreed Judgment Amount and all other matters relating to the NYDIG Loans in exchange for the NYDIG Defendants ’ agreement to make certain settlement payments to NYDIG in accordance with the Settlement Agreement. As of the date of filing these consolidated financial statements, the Settlement Agreement has been fully satisfied and paid.

X
- References No definition available. + Details
Name: | us-gaap_CommitmentsAndContingenciesDisclosureAbstract
Namespace Prefix: | us-gaap_
Data Type: | xbrli:stringItemType
Balance Type: | na
Period Type: | duration

X
- Definition The entire disclosure for commitments and contingencies. + References Reference 1: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 405 -SubTopic 30 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/405-30/tableOfContent Reference 2: http://www.xbrl.org/2003/role/disclosureRef -Topic 440 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482648/440-10-50-4 Reference 3: http://www.xbrl.org/2009/role/commonPracticeRef -Topic 450 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/450/tableOfContent Reference 4: http://www.xbrl.org/2003/role/disclosureRef -Topic 954 -SubTopic 440 -Name Accounting Standards Codification -Section 50 -Paragraph 1 -Subparagraph (a) -Publisher FASB -URI https://asc.fasb.org/1943274/2147478522/954-440-50-1 Reference 5: http://www.xbrl.org/2003/role/disclosureRef -Topic 440 -SubTopic 10 -Name Accounting Standards Codification -Section 50 -Paragraph 4 -Subparagraph (c) -Publisher FASB -URI https://asc.fasb.org/1943274/2147482648/440-10-50-4 Reference 6: http://fasb.org/us-gaap/role/ref/legacyRef -Topic 440 -Name Accounting Standards Codification -Publisher FASB -URI https://asc.fasb.org/440/tableOfContent + Details
Name: | us-gaap_CommitmentsAndContingenciesDisclosureTextBlock
Namespace Prefix: | us-gaap_
Data Type: | dtr-types:textBlockItemType
Balance Type: | na
Period Type: | duration