Soluna Forms 50 MW AI Data Center JV With Applied Digital at Dorothy 3

summarizeSummary

Soluna signed a definitive agreement with Applied Digital to form a jointly owned company that will build a planned 50 MW AI/HPC data center at Project Dorothy 3 in Texas. Applied holds 51% and funds development, while Soluna contributes land and power assets for 49%. Closing is targeted by year-end and hinges on a Briscoe County tax abatement and definitive leases; ChronoScale holds a non-binding LOI to lease the facility. Shareholders on Oct 19 approved raising authorized shares from 375 million to 1 billion and cleared the 20%+ issuance threshold.

check_boxKey Events · M&A and Partnerships · SLNH

• Updated · Oct 21 · Seeking Alpha

  Comes Amid Strained Balance Sheet

  The deal follows the Q2 2026 10-Q, which disclosed a $22.6M net loss, a probable debt covenant breach and a material weakness in controls, and the October 19 shareholder vote approving an increase in authorized shares from 375 million to 1 billion, which also cleared the 20%+ issuance threshold.

• Applied Digital JV for 50 MW AI Site

  A definitive agreement forms a Project Company to develop a planned 50 MW critical IT data center for AI and HPC at Project Dorothy 3 near Silverton, Texas, powered in part by the 150 MW Briscoe Wind Farm.

• Applied Takes 51%, Soluna 49%

  Soluna contributes a portion of the Dorothy 3 site, including land and power-related project assets, while Applied provides the development capital and holds 51% of the Project Company versus Soluna's 49%.

• ChronoScale Signs Non-Binding Lease LOI

  ChronoScale Holdings (Nasdaq: CHRN), majority-owned by Applied, signed a non-binding letter of intent for a triple-net lease of the planned facility; there is no assurance a definitive lease will be executed.

auto_awesomeAnalysis · SLNH · Crypto Assets

Soluna is turning a development-stage site into a funded project by bringing in Applied Digital, a proven AI data center builder, to supply the capital for a 50 MW critical IT facility at Dorothy 3, while Soluna contributes land and power assets and retains 49%. The move matters because Soluna's own balance sheet is stretched: Q2 2026 showed a $22.6M net loss, a probable debt covenant breach and a material weakness in controls, and the company has been leaning on a $500M ATM. A partner-funded buildout shifts the capital burden off Soluna while preserving its exposure to AI/HPC demand, and the ChronoScale letter of intent, if converted to a definitive lease, would supply an anchor tenant. On Oct 19 shareholders approved raising authorized shares from 375 million to 1 billion and cleared the 20%+ issuance threshold. The catch is that nothing is closed. The deal needs a Briscoe County tax abatement, title policies, an operating agreement, definitive leases and power agreements, and the ChronoScale lease is non-binding. Target closing is by year-end, so the tax abatement approval is the gating item to track.