EQUIPMENT DEPOSITS

3 Months Ended

Mar. 31, 2022

Commitments and Contingencies Disclosure [Abstract]

Equipment deposits are contractual agreements with five vendors to deliver and install miners at future dates. The following details the vendors, miner models, miner counts, and expected delivery months. The Company is contractually committed to take future deliveries, and portions of the equipment are collateralized against the WhiteHawk Promissory Note (as defined below) as disclosed in Note 6 – Long-Term Debt. With the exception of Cryptech Solutions ("Cryptech"), where there is an installment payments plan, all unpaid deposits will be made on the last month referenced in the timeframe below. The delivery timeframe for the 2,400 Cryptech miners will be in equal installments of 200 per month for 12 months starting in November 2021. Deliveries for the other vendors vary within the referenced timeframes.

In March 2022, the Company evaluated the MinerVa equipment deposits for impairment under the provisions of ASC 360, "Property, Plant and Equipment". As a result of the evaluation, the Company determined an indicator for impairment was present under ASC 360-10-35-21. The Company undertook a test for recoverability under ASC 360-10-35-29 and a further fair value analysis in accordance with ASC 820, Fair Value Measurement. The difference between the fair value of

the MinerVa equipment deposits and the carrying value resulted in the Company recording an impairment charge of $12,228,742, as shown in the table below.

The following table details the total equipment deposits of $98,577,594 as of March 31, 2022:


Vendor	Model	Count	Delivery Timeframe	Total Commitments	Unpaid [A]	Transferred to PP&E [B]	Impairment	Equipment Deposits
MinerVa [C]	MinerVa	15,000	Oct '21 - Sep '22	$69,387,550	—	$(15,251,383)	$(12,228,742)	$41,907,425
Cryptech	Bitmain	2,400	Nov '21 - Oct '22	12,660,000	(2,637,500)	(3,128,075)	—	6,894,425
Northern Data	MicroBT	9,900	Oct '21 - Jan '22	22,061,852	—	(21,914,773)	—	147,079
Bitmain Technologies Limited	Antminer	12,000	Apr '22 - Dec '22	75,000,000	(32,236,500)	—	—	42,763,500
Northern Data PA. LLC	WhatsMiners	4,280	Jan '22 - June '22	11,340,374	(2,835,094)	(1,640,115)	—	6,865,165
Totals		43,580		$190,449,776	$(37,709,094)	$(41,934,346)	$(12,228,742)	$98,577,594

[A] Future commitments still owed to each vendor. Refer to Note 8 – Commitments and Contingencies for further details.

[B] Miners that are delivered and physically placed in service are transferred to a fixed asset account at the respective unit price as defined in the agreement.

[C] Refer to Note 8 – Commitments and Contingencies for a $3,999,980 refund that reduced the total commitments to $69,387,550 for this vendor.