Soluna Holdings: enters joint venture to build 50 megawatt data center

What happened

• Soluna Holdings filed an 8-K reporting that on Oct 20, 2026 it entered into a Subscription Agreement with affiliates of Applied Digital Corporation to form a jointly owned company (the "Project Company") to develop a planned 50 megawatt Critical I.T. data center at Project Dorothy 3 near Silverton (Briscoe County), Texas and the Briscoe Wind Farm.
• The filing states Soluna HPC D3 STX HoldCo, LLC ("Soluna Investor") will subscribe for and acquire common units representing 49% of the Project Company and APLD STX Holdings LLC ("Applied Investor") will subscribe for and acquire common units representing 51% of the Project Company.
• The filing contemplates that, at the Closing, the Company will issue in a private placement a common stock purchase warrant to purchase up to 7,644,444 shares of common stock at an exercise price of $0.74 per share, exercisable any time on or after issuance and on or prior to the seven-year anniversary.

Key details

• Soluna Investor is attributed $18,750,000 of consideration via a Ground Sublease; Applied Investor will contribute $19,515,306 in cash, subject to a dollar-for-dollar credit for certain prior funded development or equipment costs.
• Closing is expected on or before Dec 1, 2026 (the "Outside Date"); the Outside Date may be extended one time by 30 days or 10 days in specified circumstances but in no event beyond Dec 31, 2026.
• If the Closing fails and the Subscription Agreement is terminated, Soluna Investor will reimburse Applied Investor for 80% of Funded Costs, up to a maximum of $45,000,000, subject to a reimbursement schedule and interest.
• The Subscription Agreement requires various closing conditions, including the Tax Abatement Vote, accuracy of representations and warranties, execution of Transaction Documents (including an amended and restated LLC agreement), requisite internal approvals, and issuance of a Leasehold Title Policy.

Why it may matter

• Item reported: Item 1.01 (entry into a material definitive agreement) covering the Subscription Agreement, the amended and restated LLC agreement for the Project Company, various lease and ancillary agreements, and related transaction documents.
• Item reported: Item 3.02 (unregistered sale of equity securities) covering the contemplated private issuance of the common stock purchase warrant to Applied or its affiliate.
• A filing does not show why the insider traded or why the company acted.