Delaware 86-1746728 (State or other jurisdiction of (I.R.S. Employer 06890 (Address of principal executive offices) (Zip Code) Title of each class Trading symbol(s) Name of each exchange on which registered Class A Common Stock, $0.0001 par value GREE The Nasdaq Global Select Market 8.50% Senior Notes due 2026 GREEL The Nasdaq Global Select Market o Large accelerated filer o Accelerated filer o Non-accelerated filer x Smaller reporting company x Emerging growth company x Page March 31, 2022 December 31, 2021 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 96,453 $ 82,599 Short term investments - 496 Digital assets 393 476 Accounts receivable 5,569 5,524 Prepaid expenses 10,286 9,146 Emissions and carbon offset credits 1,025 2,361 Total current assets 113,726 100,602 LONG-TERM ASSETS: Property and equipment, net 292,051 217,091 Right-of-use assets 1,375 1,472 Intangible assets, net 3,305 3,537 Goodwill 3,062 3,062 Deferred tax assets 16,846 15,058 Other long-term assets 989 445 Total assets $ 431,354 $ 341,267 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 14,823 $ 5,923 Accrued emissions expense 2,637 2,634 Accrued expenses 11,676 10,375 Income taxes payable 3,879 2,481 Long-term debt, current portion 66,729 19,577 Lease obligations, current portion 500 736 Total current liabilities 100,244 41,726 LONG-TERM LIABILITIES: Long-term debt, net of current portion and deferred financing fees 103,191 75,251 Lease obligations, net of current portion 195 193 Asset retirement obligations 2,691 2,691 Environmental liability 8,615 8,615 Other long-term liabilities 366 368 Total liabilities 215,302 128,844 COMMITMENTS AND CONTINGENCIES (NOTE 13) STOCKHOLDERS' EQUITY: Preferred stock, par value $0.0001, 20,000,000 shares authorized, 0ne outstanding - - Common stock, par value $0.0001, 3,000,000,000 shares authorized, 4 4 Additional paid-in capital 285,905 281,815 Cumulative translation adjustment (32 ) - Accumulated deficit (69,825 ) (69,396 ) Total stockholders' equity 216,052 212,423 Total liabilities and stockholders' equity $ 431,354 $ 341,267 Three Months Ended March 31, 2022 2021 REVENUE: Cryptocurrency datacenter $ 23,232 $ 8,997 Power and capacity 5,923 2,066 Services and other 8,500 0 Total revenue 37,655 11,063 OPERATING COSTS AND EXPENSES: Cost of revenue - cryptocurrency datacenter (exclusive of 8,456 2,574 Cost of revenue - power and capacity (exclusive of 4,023 2,009 Cost of revenue - services and other (exclusive of 4,071 0 Selling, general and administrative 14,392 3,229 Merger and other costs 213 105 Depreciation and amortization 3,978 1,261 Total operating costs and expenses 35,133 9,178 Income from operations 2,522 1,885 OTHER INCOME (EXPENSE), NET: Interest expense, net (3,353 ) (166 ) Interest expense - related party 0 (22 ) (Loss) gain on sale of digital assets (5 ) 295 Other income, net 39 19 Total other (expense) income, net (3,319 ) 126 (LOSS) INCOME BEFORE INCOME TAXES (797 ) 2,011 (Benefit) provision for income taxes (368 ) 732 NET (LOSS) INCOME (429 ) 1,279 Foreign currency translation adjustment (32 ) 0 COMPREHENSIVE (LOSS) INCOME $ (461 ) $ 1,279 (Loss) earnings per share: Basic $ (0.01 ) $ 0.02 Diluted $ (0.01 ) $ 0.02 Additional Common Units Preferred Units Senior Priority Units Total Cumulative Preferred Stock Common Stock Paid - In Number Members' Number Members' Number Members' Members' Translation Accumulated Shares Amount Shares Amount Capital of Units Capital of Units Capital of Units Capital Capital Adjustment Deficit Total Balance at January 1, 2022 - $ - 40,865,336 $ 4 $ 281,815 - $ - - $ - - $ - $ - $ - $ (69,396 ) $ 212,423 Stock-based compensation expense - - - - 362 - - - - - - - - - 362 Issuance of shares, net of issuance costs of $147 - - 415,000 - 3,791 - - - - - - - - 3,791 Restricted shares award issuance, net of withholdings - - 82,601 - (65 ) - - - - - - - - - (65 ) Proceeds from stock options exercised - - 334 - 2 - - - - - - - - 2 Foreign currency translation adjustment - - - - - - - - - - - - (32 ) - (32 ) Net loss - - - - - - - - - - - - (429 ) (429 ) Balance at March 31, - $ - 41,363,271 $ 4 $ 285,905 - $ - - $ - - $ - $ - $ (32 ) $ (69,825 ) $ 216,052 Balance at January 1, 2021 - $ - - $ - $ - 750 $ - 39,228 $ 39,074 10,000 $ 30,202 $ 69,276 $ - $ (24,916 ) $ 44,360 Contribution of GGH Preferred Units, GGH Senior Priority Units, and notes payable to related party for GGHI Common Stock - - 26,800,300 3 72,888 - - (39,228 ) (39,074 ) (10,000 ) (30,202 ) (69,276 ) - - 3,615 Contribution of GGH Common Units for GGHI Common Stock - - 1,199,700 - - (750 ) - - - - - - - - - Proceeds from sale of preferred stock, net of stock issuance costs of $3,387 1,620,000 1 - - 37,112 - - - - - - - - - 37,112 Stock-based compensation expense - - - - 656 - - - - - - - - - 656 Proceeds from stock options exercised - - 160,000 - 1,000 - - - - - - - - - 1,000 Stock issued to purchase miners - - 160,000 - 991 - - - - - - - - - 991 Net income - - - - - - - - - - - - - 1,279 1,279 Balance at March 31, 1,620,000 $ 1 28,320,000 $ 3 $ 112,647 - $ - - $ - - $ - $ - $ - $ (23,637 ) $ 89,014 Three Months Ended March 31, 2022 2021 CASH FLOW FROM OPERATING ACTIVITIES: Net (loss) income $ (429 ) $ 1,279 Adjustments to reconcile net (loss) income to net cash Depreciation and amortization 3,978 1,261 Deferred income taxes (1,788 ) 482 Amortization of debt issuance costs 424 0 Accretion of asset retirement obligations 0 33 Stock-based compensation expense 362 656 Changes in operating assets and liabilities: Accounts receivable (45 ) 283 Emissions and carbon offset credits 1,336 1,336 Prepaids and other assets (1,608 ) (704 ) Accounts payable 1,398 (770 ) Accrued emissions 3 (1,670 ) Accrued expenses 1,301 51 Income taxes payable 1,398 250 Net cash flow provided by operating activities $ 6,330 $ 2,487 CASH FLOW FROM INVESTING ACTIVITIES: Purchases of and deposits for property and equipment (71,135 ) (5,667 ) Proceeds from sale of marketable securities 496 0 Net cash flow used in investing activities $ (70,639 ) $ (5,667 ) CASH FLOW FROM FINANCING ACTIVITIES: Proceeds from issuance of preferred stock, net of issuance costs - 37,112 Proceeds from issuance of common stock, net of issuance costs 3,791 - Proceeds from stock options exercised 2 1,000 Restricted stock unit awards settled in cash for taxes (65 ) - Proceeds from debt, net of issuance costs 80,371 - Principal payments on debt (5,702 ) (818 ) Repayments of finance lease obligations (234 ) - Net cash flow provided by financing activities $ 78,163 $ 37,294 CHANGE IN CASH AND CASH EQUIVALENTS $ 13,854 $ 34,114 CASH AND CASH EQUIVALENTS - beginning of year 82,599 5,052 CASH AND CASH EQUIVALENTS - end of year $ 96,453 $ 39,166 Presentation of Financial Statements – Going Concern, the Company’s management evaluated whether there are conditions or events that pose risk associated with the Company's ability to continue as a going concern within one year after the date these financial statements have been issued. The Company’s condensed financial statements have been prepared assuming that it will continue as a going concern. Restricted Cash Recent Accounting Pronouncements, Adopted This guidance is effective for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2020, with early adoption permitted. As an emerging growth company, the Company has elected to adopt this pronouncement following the effective date for private companies beginning with periods beginning after December 15, 2021. The For the nine months ended September 30, 2022, the acquired Support.com business contributed $24.4 million in revenue and $4.3 million of operating income, which includes approximately $0.7 million of amortization expenses of acquired intangible assets. Three Months Ended $ in thousands March 31, 2021 Revenues $ 20,694 Net loss $ (778 ) Effective September 14, 2021, following the completion of the Merger (see Notes 1 and 3), Support.com began operating within the Company as a separate operating and reporting segment; therefore, Greenidge has through direct customer downloads and sales via partners. The Support Services segment operates primarily in the United States, but also has employees located in Philippines, India, Mexico, Colombia and Canada, including those staff providing support services. The table below presents information about reportable segments for the three and nine months ended Three Months Ended March 31, $ in thousands 2022 2021 Revenues: Cryptocurrency Datacenter and Power Generation $ 29,155 $ 11,063 Support Services 8,500 - Total Revenues $ 37,655 $ 11,063 Segment Adjusted EBITDA Cryptocurrency Datacenter and Power Generation $ 7,344 $ 4,221 Support Services 1,869 - Total Segments Adjusted EBITDA $ 9,213 $ 4,221 In addition, the table below provides a reconciliation of the total of the Three Months Ended March 31, $ in thousands 2022 2021 Total Segments Adjusted EBITDA $ 9,213 $ 4,221 Depreciation and amortization (3,978 ) (1,261 ) Stock-based compensation (362 ) (656 ) Merger and other costs (213 ) (105 ) Expansion costs (2,104 ) - Interest expense, net (3,353 ) (188 ) Consolidated (loss) income before income taxes $ (797 ) $ 2,011 Property and equipment, net consisted of the following at $ in thousands Estimated Useful March 31, 2022 December 31, 2021 Plant infrastructure 15 - 39 years $ 34,976 $ 34,725 Miners 5 years 64,138 48,121 Miner facility infrastructure 15 years 15,957 15,143 Land N/A 13,460 8,460 Equipment 5 years 961 1,660 Software 3 years 636 636 Coal ash impoundment 4 years 2,410 2,410 Construction in process N/A 45,195 25,856 Miner deposits N/A 135,327 98,110 313,060 235,121 Less: Accumulated depreciation (21,009 ) (18,030 ) $ 292,051 $ 217,091 to fair value. Fair value was determined utilizing the market approach. The excess of the book value over the estimated fair value was allocated to the long-lived assets of the Cryptocurrency and Power Generation segment. $ in thousands Intangible Assets Accumulated Amortization Intangible Assets, Net Balance at December 31, 2021 $ 3,810 $ (273 ) $ 3,537 Amortization expense: Customer relationships - (207 ) (207 ) Tradename - (25 ) (25 ) Balance at March 31, 2022 $ 3,810 $ (505 ) $ 3,305 As described in Notes 1 and 3, on September 14, 2021, Greenidge and Support.com combined their respective businesses through an all-stock merger transaction that was accounted for as a business combination in accordance with ASC 805. Prior to the Merger, Greenidge did not have any intangible assets. The Company has entered into equipment finance agreements that are secured by the purchased miner equipment. These agreements generally require monthly payments of principal, interest and a risk premium fee. The following table provides information on the equipment financing agreements: $ in thousands $ in thousands Balance as of: Note Loan Date Maturity Date Interest Initial March 31, 2022 December 31, 2021 Equipment Financings: A December 2020 June 2022 17.0 % $ 4,482 $ 0 $ 1,245 B December 2020 June 2022 17.0 % 428 24 95 C March 2021 November 2022 17.0 % 2,229 991 1,362 D April 2021 December 2022 17.0 % 4,012 2,006 2,674 E - H May 2021 October 2023 15.0 % 15,724 16,089 15,223 I July 2021 January 2023 17.0 % 4,457 2,724 3,468 J July 2021 March 2023 17.0 % 2,717 1,509 1,962 K October 2021 June 2023 17.0 % 2,223 1,606 1,976 L March 2022 April 2024 13.0 % 54,425 52,706 - Bonds Payable October 2021 October 2026 8.5 % 55,200 51,961 51,843 Bonds Payable December 2021 October 2026 8.5 % 17,000 15,053 14,980 Secured Promissory Note March 2022 July 2022 / 6.0 % 26,500 25,251 0 169,920 94,828 Less: Current portion Less: Current portion (66,729 ) (19,577 ) $ 103,191 $ 75,251 Minimum future principal payments on debt as of September 30, 2022 were as follows: exceptions; limit the Borrowers’ ability to make certain restricted payments and investments; and limit the ability to create certain direct obligations of the Borrowers or the Company unless the NYDIG Financing Agreement is at least pari passu in right of payment; each of which are subject to customary and usual exceptions and baskets. The loans under the NYDIG Financing Agreement cannot be voluntarily partially prepaid, but may be prepaid in whole subject to a make-whole calculation. The NYDIG Financing Agreement is denoted in the table above as "Equipment Financings: L." $ in thousands Remainder of 2022 $ 58,116 2023 36,325 2024 11,739 2025 0 2026 72,200 Total $ 178,380 Letters of Credit liability (see Note 13). Atlas from time to time incur certain expansion costs for the benefit of Greenidge, which are fully reimbursed by Greenidge. The amount of costs reimbursed by Greenidge during the nine months ended September 30, 2022 was less than $0.1 million. The per share purchase price for the shares of class A common stock that Greenidge In February 2021, Greenidge adopted an equity incentive plan and reserved 3,831,112 shares of class A common stock for issuance under the plan (the “2021 Equity Plan”) , applicable to employees and non-employee directors. The Company’s unvested RSU awards activity for the Weighted Average Grant Date RSUs Fair Value Unvested at December 31, 2021 516,987 $ 6.80 Granted 5,335 15.32 Vested (90,704 ) 6.25 Unvested at March 31, 2022 431,618 $ 7.01 The Company’s common stock options activity for the Weighted Average Weighted Average Remaining Aggregate Exercise Price Contractual Life Intrinsic Options Per Share (in years) Value Outstanding at December 31, 2021 583,080 $ 6.01 9.2 $ 5,854 Granted 0 0 Exercised (334 ) 6.25 Forfeited (2,888 ) 6.25 Outstanding at March 31, 2022 579,858 $ 6.01 8.9 $ 1,430 Exercisable as of March 31, 2022 439,225 $ 5.86 8.9 $ 1,150 The income tax provision for interim periods is determined using an estimate of the annual effective tax rate, adjusted for discrete items, if any, that are taken into account in the relevant period. Each quarter, the estimate of the annual effective tax rate is updated, and if the estimated effective tax rate changes, a cumulative adjustment is made. In addition, the effect of changes in enacted tax laws or rates or tax status is recognized in the interim period in which the change occurs. The following table sets forth a reconciliation of the numerator and denominator used to compute basic earnings and diluted per share of common stock. Three Months Ended March 31: $ in thousands, except per share amounts 2022 2021 Numerator Net (loss) income $ (429 ) $ 1,279 Less: Net income attributable to the member units before the reorganization 0 (647 ) Net (loss) income attributable to Greenidge $ (429 ) $ 632 Denominator Basic weighted average shares outstanding 41,058 28,139 Dilutive effect of equity awards 0 8 Dilutive effect of convertible preferred stock 0 0 Diluted weighted average shares outstanding 41,058 28,147 (Loss) earnings per share Basic $ (0.01 ) $ 0.02 Diluted $ (0.01 ) $ 0.02 anti-dilutive. For the three and nine months ended Environmental Obligations ("ASC 410-30"), the Company has recorded an environmental liability of $8.6 million as of September 30, 2022 and December 31, 2021. As required by NYSDEC, companies with landfills are required to fund a trust to cover closure costs and expenses after the landfill has stopped operating or, in lieu of a trust, may negotiate to maintain a letter of credit guaranteeing the payment of the liability. Estimates are based on various assumptions including, but not limited to, closure and post-closure cost estimates, timing of expenditures, escalation factors, and requirements of granted permits. Additional adjustments to the environment liability may occur periodically due to potential changes in estimates and assumptions. 14. CONCENTRATIONS NYISO accounted for 13% and 12% of consolidated revenue for the nine months ended September 30, 2022 and 2021, respectively. 2022 and has not been renewed. Greenidge had the following noncash investing and financing activities: Three Months Ended March 31, $ in thousands 2022 2021 Property and equipment purchases financed with common stock $ - $ 991 Property and equipment purchases in accounts payable $ 10,271 $ 876 Contribution of GGH Preferred Units and Senior Priority Units for common stock $ 0 $ 69,276 Contribution of related party notes payable and accrued interest for common stock $ 0 $ 3,615 through direct customer downloads and sale via partners. The Support Services segment operates primarily in the United States, but also has employees located in Philippines, India, Mexico, Columbia and Canada, including staff providing support services. - Three Months Ended September 30, Three Months Ended March 31, $ in thousands 2022 2021 Variance Total revenue $ 37,655 $ 11,063 240.4 % Cost of revenue (exclusive of 16,550 4,583 261.1 % Selling, general and administrative expenses 14,392 3,229 345.7 % Merger and other costs 213 105 102.9 % Depreciation and amortization 3,978 1,261 215.5 % Income from operations 2,522 1,885 33.8 % Other (expense) income: Interest expense, net (3,353 ) (166 ) 1919.9 % Interest expense - related party - (22 ) -100.0 % (Loss) gain on sale of digital assets (5 ) 295 -101.7 % Other income, net 39 19 105.3 % Total other (expense) income, net (3,319 ) 126 -2734.1 % (Loss) income before income taxes (797 ) 2,011 -139.6 % (Benefit) provision for income taxes (368 ) 732 -150.3 % Net (loss) income $ (429 ) $ 1,279 -133.5 % Adjusted Amounts (a) Adjusted income from operations $ 4,839 $ 1,990 Adjusted operating margin 12.9 % 18.0 % Adjusted net income $ 1,263 $ 1,355 Other Financial Data (a) EBITDA $ 6,534 $ 3,460 as a percent of revenues 17.4 % 31.3 % Adjusted EBITDA $ 9,213 $ 4,221 as a percent of revenues 24.5 % 38.2 % Three Months Ended March 31, $ in thousands 2022 2021 Variance Cryptocurrency datacenter $ 23,232 $ 8,997 158.2 % Power and capacity 5,923 2,066 186.7 % Services and other 8,500 - N/A Total revenue $ 37,655 $ 11,063 240.4 % Three Months Ended March 31, 2022 2021 Cryptocurrency datacenter 61.7 % 81.3 % Power and capacity 15.7 % 18.7 % Services and other 22.6 % N/A Total revenue 100.0 % 100.0 % Three Months Ended March 31, $ in thousands 2022 2021 Variance Cryptocurrency datacenter $ 8,456 $ 2,574 228.5 % Power and capacity 4,023 2,009 100.2 % Services and other 4,071 - N/A Total cost of revenue $ 16,550 $ 4,583 261.1 % As a percentage of total revenue 44.0 % 41.4 % These costs decreased $29.6 million, or 99%, to $0.2 million, as these were primarily non-recurring transaction costs in 2021. the equity-based success fees associated with the Merger. (loss) income Results of Operations - Three Months Ended September 30 business trends. The reported amounts in the table below are from the Condensed Consolidated Statements of Operations and Comprehensive (Loss) Income. Three Months Ended March 31, $ in thousands 2022 2021 Variance REVENUE Cryptocurrency Datacenter and $ 29,155 $ 11,063 164 % Support Services 8,500 - N/A Total Revenue $ 37,655 $ 11,063 240 % SEGMENT ADJUSTED EBITDA Cryptocurrency Datacenter and $ 7,344 $ 4,221 74 % Support Services 1,869 - N/A Total Adjusted EBITDA $ 9,213 $ 4,221 118 % Reconciliation to (loss) income before income taxes: Depreciation and amortization (3,978 ) (1,261 ) Stock-based compensation (362 ) (656 ) Merger and other costs (213 ) (105 ) Expansion costs (2,104 ) - Interest expense, net (3,353 ) (188 ) Consolidated (loss) income before income taxes $ (797 ) $ 2,011 $ in thousands, except $ per MWh Three Months Ended March 31, and average bitcoin price 2022 2021 Variance Cryptocurrency datacenter $ 23,232 $ 8,997 158.2 % Power and capacity 5,923 2,066 186.7 % Total revenue $ 29,155 $ 11,063 163.5 % MWh Cryptocurrency datacenter 101,090 48,286 109.4 % Power and capacity 53,261 40,328 32.1 % Revenue per MWh Cryptocurrency datacenter $ 230 $ 186 23.7 % Power and capacity $ 111 $ 51 117.6 % Cost of revenue (exclusive of depreciation Cryptocurrency datacenter $ 8,456 $ 2,574 228.5 % Power and capacity $ 4,023 $ 2,009 100.2 % Cost of revenue per MWh (exclusive of Cryptocurrency datacenter $ 84 $ 53 58.5 % Power and capacity $ 76 $ 50 52.0 % Cryptocurrency Datacenter Metrics Bitcoins produced 561 213 163.4 % Average bitcoin price $ 41,188 $ 45,211 -8.9 % Average hash rate (EH/s) 267.3 % Average difficulty 26.4 % prior year. (loss) bitcoin mining hash rate. Accounting Policies and Estimates” in our Annual Report on Form 10-K for the year ended December 31, 2021. As of the date of this filing, there were no significant changes to any of the critical accounting policies and estimates previously described in our Annual Report on Form 10-K for the year ended December 31, Three Months Ended March 31, $ in thousands 2022 2021 Adjusted operating income Income from operations $ 2,522 $ 1,885 Merger and other costs 213 105 Expansion costs 2,104 - Adjusted income from operations $ 4,839 $ 1,990 Adjusted operating margin 12.9 % 18.0 % Adjusted net income Net (loss) income $ (429 ) $ 1,279 Merger and other costs, after tax 156 76 Expansion costs, after tax 1,536 - Adjusted net income $ 1,263 $ 1,355 EBITDA and Adjusted EBITDA Net (loss) income $ (429 ) $ 1,279 (Benefit) provision for income taxes (368 ) 732 Interest expense, net 3,353 188 Depreciation and amortization 3,978 1,261 EBITDA 6,534 3,460 Stock-based compensation 362 656 Merger and other costs 213 105 Expansion costs 2,104 - Adjusted EBITDA $ 9,213 $ 4,221 GAAP results and using EBITDA and Adjusted EBITDA on a supplemental basis. You should review the reconciliation of $ in thousands Total Remainder of 2022 2023-2024 2025-2026 Thereafter Debt payments $ 220,627 $ 66,036 $ 70,117 $ 84,474 $ - Leases $ 608 367 241 - - Miner and other purchase $ 61,342 61,342 - - - Environmental and asset $ 11,415 1,037 4,298 2,142 3,938 Natural Gas Transportation $ 16,116 1,422 3,792 3,792 7,110 Total $ 310,108 $ 130,204 $ 78,448 $ 90,408 $ 11,048 Risk Factors Three Months Ended March 31, $ in thousands 2022 2021 Net cash provided by operating activities $ 6,330 $ 2,487 Net cash used in investing activities (70,639 ) (5,667 ) Net cash provided by financing activities 78,163 37,294 Net change in cash and cash equivalents 13,854 34,114 Cash and cash equivalents at beginning of year 82,599 5,052 Cash and cash equivalents at end of period $ 96,453 $ 39,166 datacenter operations. Exhibit No. Description 10.2 10.4 31.1* 31.2* 32.1* 32.2* 101 Interactive data files pursuant to Rule 405 of Regulation S-T: (i) the Balance Sheets, (ii) the Statements of Operations, (iii) the Statements of Cash Flows and (iv) the Notes to Unaudited Condensed Interim Consolidated Financial Statements. 104 Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101). * Furnished herewith. Greenidge Generation Holdings Inc. Date: By: /s/ David Anderson Chief Executive Officer Date: By: /s/ Robert Loughran Robert Loughran Chief Financial Officerx QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934March 31, 2022ORo TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
incorporation or organization)
Identification No.), 3rd Floor, CT(203) (203) 718-5960☒x No ☐o☒x No ☐☐☐☒☒☒☐ o☐o No☒ xMay 13,November 11, 2022, the registrant had 12,838,86116,213,043 shares of Class A common stock, $0.0001 par value per share, outstanding and 28,526,372 shares of Class B common stock, $0.0001 par value per share, outstanding.345671727272828282828282929301
(Unaudited)
41,363,271 and 40,865,336 shares issued and outstanding as of March 31, 2022
and December 31, 2021, respectivelySeptember 30, 2022
(Unaudited)December 31, 2021 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 28,013 $ 82,599 Restricted cash 10,500 — Short-term investments — 496 Digital assets 337 476 Accounts receivable 4,704 5,524 Prepaid expenses 9,694 9,146 Emissions and carbon offset credits 1,259 2,361 Total current assets 54,507 100,602 LONG-TERM ASSETS: Property and equipment, net 246,071 217,091 Right-of-use assets 222 1,472 Intangible assets, net 2,841 3,537 Goodwill 3,062 3,062 Deferred tax assets 29 15,058 Other long-term assets 615 445 Total assets $ 307,347 $ 341,267 LIABILITIES AND STOCKHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 4,064 $ 5,923 Accrued emissions expense 5,226 2,634 Accrued expenses 15,560 10,375 Income taxes payable 185 2,481 Long-term debt, current portion 73,218 19,577 Lease obligations, current portion 112 736 Total current liabilities 98,365 41,726 LONG-TERM LIABILITIES: Long-term debt, net of current portion and deferred financing fees 96,515 75,251 Lease obligations, net of current portion 137 193 Environmental liabilities 22,415 11,306 Other long-term liabilities 358 368 Total liabilities 217,790 128,844 COMMITMENTS AND CONTINGENCIES (NOTE 13) STOCKHOLDERS' EQUITY: Preferred stock, par value $0.0001, 20,000,000 shares authorized, none outstanding — — Common stock, par value $0.0001, 3,000,000,000 shares authorized, 42,964,462 and 40,865,336 shares issued and outstanding as of September 30, 2022 and December 31, 2021, respectively 4 4 Additional paid-in capital 290,576 281,815 Cumulative translation adjustment (139) — Accumulated deficit (200,884) (69,396) Total stockholders' equity 89,557 212,423 Total liabilities and stockholders' equity $ 307,347 $ 341,267
depreciation and amortization)
depreciation and amortization)
depreciation and amortization)Three Months Ended September 30, Nine Months Ended September 30, 2022 2021 2022 2021 REVENUE: Cryptocurrency datacenter $ 18,272 $ 31,156 $ 61,571 $ 54,217 Power and capacity 3,613 3,077 12,395 7,255 Services and other 7,474 1,521 24,387 1,521 Total revenue 29,359 35,754 98,353 62,993 OPERATING COSTS AND EXPENSES: Cost of revenue - cryptocurrency datacenter (exclusive of depreciation and amortization) 14,675 5,974 34,795 11,504 Cost of revenue - power and capacity (exclusive of depreciation and amortization) 3,760 2,831 10,955 6,688 Cost of revenue - services and other (exclusive of depreciation and amortization) 3,660 854 11,304 854 Selling, general and administrative 10,240 5,446 35,720 12,017 Merger and other costs 242 29,847 940 31,095 Depreciation and amortization 13,835 2,667 22,680 5,531 Impairment of long-lived assets — — 71,500 — Remeasurement of environmental liability — — 11,109 — Total operating costs and expenses 46,412 47,619 199,003 67,689 Loss from operations (17,053) (11,865) (100,650) (4,696) OTHER EXPENSE, NET: Interest expense, net (5,430) (1,009) (15,693) (1,377) Interest expense - related party — — — (22) Gain (loss) on sale of digital assets — 18 (15) 159 Loss on sale of assets (759) — (130) — Other income (loss), net 144 (29) 200 (23) Total other expense, net (6,045) (1,020) (15,638) (1,263) Loss before income taxes (23,098) (12,885) (116,288) (5,959) Provision for income taxes 79 (4,989) 15,200 (2,860) Net loss (23,177) (7,896) (131,488) (3,099) Foreign currency translation adjustment 27 — (139) — Comprehensive loss $ (23,150) $ (7,896) $ (131,627) $ (3,099) Loss per share: Basic $ (0.55) $ (0.26) $ (3.16) $ (0.13) Diluted $ (0.55) $ (0.26) $ (3.16) $ (0.13) Preferred Stock Common Stock Additional
Paid - In
CapitalCommon Units Preferred Units Senior Priority Units Total
Members'
CapitalCumulative
Translation
AdjustmentAccumulated
Deficit Total Shares Amount Shares Amount Number
of UnitsMembers'
CapitalNumber
of UnitsMembers'
CapitalNumber
of UnitsMembers'
CapitalBalance at January 1, 2022 — $ — 40,865,336 $ 4 $ 281,815 — — — — — — $ — $ — $ (69,396) $ 212,423 Stock-based compensation expense — — — — 362 — — — — — — — — — 362 Issuance of shares, net of issuance costs — — 415,000 — 3,791 — — — — — — — — — 3,791 Restricted shares award issuance, net of withholdings — — 82,601 — (65) — — — — — — — — — (65) Proceeds from stock options exercised — — 334 — 2 — — — — — — — — 2 Foreign currency translation adjustment — — — — — — — — — — — — (32) — (32) Net loss — — — — — — — — — — — — (429) (429) Balance at March 31, 2022 — — 41,363,271 4 285,905 — — — — — — — (32) (69,825) 216,052 Stock-based compensation expense — — — — 306 — — — — — — — — — 306 Issuance of shares, net of issuance costs — — 553,587 — 2,078 — — — — — — — — 2,078 Proceeds from stock options exercised — — 1,962 — 12 — — — — — — — — 12 Foreign currency translation adjustment — — — — — — — — — — — — (134) — (134) Net loss — — — — — — — — — — — — (107,882) (107,882) Balance at June 30, 2022 — — 41,918,820 4 288,301 — — — — — — — (166) (177,707) 110,432 Stock-based compensation expense — — — — 361 — — — — — — — — — 361 Issuance of shares, net of issuance costs — — 1,045,642 — 1,914 — — — — — — — — 1,914 Foreign currency translation adjustment — — — — — — — — — — — — 27 — 27 Net loss — — — — — — — — — — — — — (23,177) (23,177) Balance at September 30, 2022 — $ — 42,964,462 $ 4 $ 290,576 — — — — — — $ — $ (139) $ (200,884) $ 89,557
2022
2021Preferred Stock Common Stock Additional
Paid - In
CapitalCommon Units Preferred Units Senior Priority Units Total
Members'
CapitalCumulative
Translation
AdjustmentAccumulated
DeficitTotal Shares Amount Shares Amount Number
of UnitsMembers'
CapitalNumber
of UnitsMembers'
CapitalNumber
of UnitsMembers'
CapitalBalance at January 1, 2021 — $ — — $ — $ — 750 — 39,228 39,074 10,000 30,202 $ 69,276 $ — $ (24,916) $ 44,360 Contribution of GGH Preferred Units, GGH Senior Priority Units, and notes payable to related party for GGHI Common Stock — — 26,800,300 3 72,888 — — (39,228) (39,074) (10,000) (30,202) (69,276) — — 3,615 Contribution of GGH Common Units for GGHI Common Stock — — 1,199,700 — — (750) — — — — — — — — — Proceeds from sale of preferred stock, net of stock issuance costs of $3,387 1,620,000 1 — — 37,112 — — — — — — — — — 37,113 Stock-based compensation expense — — — — 1,063 — — — — — — — — — 1,063 Proceeds from stock options exercised — — 160,000 — 1,000 — — — — — — — — — 1,000 Stock issued to purchase miners — — 160,000 — 991 — — — — — — — — — 991 Net income — — — — — — — — — — — — — 4,797 4,797 Balance at June 30, 2021 1,620,000 1 28,320,000 3 113,054 — — — — — — — — (20,119) 92,939 Shares issued to Support.com shareholders upon Merger, net of issuance costs of $2,296 — — 2,960,731 — 91,588 — — — — — — — — — 91,588 Issuance of shares for investor fee associated with successful completion of Merger — — 562,174 — 17,826 — — — — — — — — — 17,826 Issuance of warrants to advisor in connection with completion of Merger — — — — 8,779 — — — — — — — — — 8,779 Conversion of preferred stock (1,620,000) (1) 6,480,000 1 — — — — — — — — — — — Shares issued upon exercise of warrants — — 344,800 — 2,155 — — — — — — — — — 2,155 Stock-based compensation expense — — — — 411 — — — — — — — — — 411 Net loss — — — — — — — — — — — — — (7,896) (7,896) Balance at September 30, 2021 — $ — 38,667,705 $ 4 $ 233,813 — — — — — — $ — $ — $ (28,015) $ 205,802
flow from operating activities:Nine Months Ended September 30, 2022 2021 CASH FLOW FROM OPERATING ACTIVITIES: Net loss $ (131,488) $ (3,099) Adjustments to reconcile net loss to net cash flow from operating activities: Depreciation and amortization 22,680 5,531 Deferred income taxes 15,016 (2,945) Impairment of long-lived assets 71,500 — Amortization of debt issuance costs 3,059 54 Impairment of digital assets 85 — Loss on sale of assets 130 — Remeasurement of environmental liability 11,109 170 Stock-based compensation expense 1,029 1,474 Investor fee paid in common stock — 17,826 Advisor fee paid in warrants — 8,779 Changes in operating assets and liabilities: Accounts receivable 820 272 Emissions and carbon offset credits 1,102 107 Prepaids and other assets (548) (5,955) Accounts payable (1,559) (455) Accrued emissions 2,592 (408) Accrued expenses 5,185 5,315 Income taxes payable (2,296) — Other 358 — Net cash flow used for operating activities (1,226) 26,666 CASH FLOW FROM INVESTING ACTIVITIES: Purchases of and deposits for property and equipment (127,374) (65,757) Proceeds from sale of assets 4,802 — Proceeds from sale of marketable securities 496 — Cash received in merger — 27,113 Net cash flow used for investing activities (122,076) (38,644) CASH FLOW FROM FINANCING ACTIVITIES: Proceeds from issuance of preferred stock, net of issuance costs — 37,113 Proceeds from issuance of common stock, net of issuance costs 7,783 — Proceeds from stock options exercised 14 1,000 Proceeds from warrants exercised — 2,155 Issuance costs associated with shares issued for Support acquisition — (2,296) Restricted stock unit awards settled in cash for taxes (65) — Proceeds from debt, net of issuance costs 107,105 25,112 Principal payments on debt (35,258) (4,440) Repayments of lease obligations (363) (569) Net cash flow provided by financing activities $ 79,216 $ 58,075 CHANGE IN CASH AND CASH EQUIVALENTS AND RESTRICTED CASH (44,086) 46,097 CASH AND CASH EQUIVALENTS - beginning of year 82,599 5,052 CASH AND CASH EQUIVALENTS AND RESTRICTED CASH - end of period $ 38,513 $ 51,149 6Greenidge Generation Holdings Inc.NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (UNAUDITED)or leased by the Company. The earned bitcoin is then exchanged for U.S. dollars. The Company owns and operates a 106 megawatt ("MW") power facility that is connected to the New York Independent System Operator (“NYISO”) power grid. The Company sells electricity to the NYISO at all times when its power plant is running and increases or decreases the amount of electricity sold based on prevailing prices in the wholesale electricity market and demand for electricity.financial statements include all adjustments necessary for a fair presentation of the results for the interim periods presented and such adjustments are of a normal recurring nature. The results for the unaudited interim condensed consolidated statements of operations and comprehensive (loss) income are not necessarily indicative of results to be expected for the year ending December 31, 2022 or for any future interim period. The unaudited condensed interim consolidated financial statements do not include all of the information and notes required by U.S. GAAPUnited States Generally Accepted Accounting Principles ("GAAP") for complete financial statements.year'speriod presentation.7adoption ofCompany adopted this standard on January 1, 2022, and the adoption did not materially impact the Company's condensed consolidated financial statements.March 31,September 30, 2022, the acquired Support.com business contributed $8.5$7.5 million in revenue and $1.5$1.0 million of operating income, which includes approximately $0.2$0.2 million of amortization expenses of acquired intangible assets.$ in thousands Three Months Ended
September 30, 2021Nine Months Ended
September 30, 2021Revenues $ 42,448 $ 87,830 Net loss $ (11,783) $ (12,602) March 31,September 30, 2021 include $1.6$30.0 million and $32.4 million, respectively, of transaction costs for both Greenidge and Support.com ($1.2$24.5 million after tax)and $26.9 million after tax, respectively), such as advisor fees, legal and accounting expenses. These costs will not affect the combined company’s statement of operations beyond 12 months after the closing date, September 14, 2021.4.2two operating and reporting segments since the Merger: (i) Cryptocurrency Datacenter and Power Generation and (ii) Support Services.8“segment“Segment Adjusted EBITDA”). This is the measure used by the Company's Chief Operating Decision Maker to assess performance and allocate resources.March 31,September 30, 2022 and 2021, respectively:Three Months Ended September 30, Nine Months Ended September 30, $ in thousands 2022 2021 2022 2021 Revenues: Cryptocurrency Datacenter and Power Generation $ 21,885 $ 34,233 $ 73,966 $ 61,472 Support Services 7,474 1,521 24,387 1,521 Total Revenues $ 29,359 $ 35,754 $ 98,353 $ 62,993 Segment Adjusted EBITDA (loss) Cryptocurrency Datacenter and Power Generation $ (3,669) $ 20,973 $ 3,886 $ 33,464 Support Services 1,381 204 5,282 204 Total Segments Adjusted EBITDA (loss) $ (2,288) $ 21,177 $ 9,168 $ 33,668 segmentsSegments Adjusted EBITDA to the consolidated (loss) income before income taxes:Three Months Ended September 30, Nine Months Ended September 30, $ in thousands 2022 2021 2022 2021 Total Segments Adjusted EBITDA (loss) $ (2,288) $ 21,177 $ 9,168 $ 33,668 Depreciation and amortization (13,835) (2,667) (22,680) (5,531) Stock-based compensation (361) (411) (1,029) (1,474) Merger and other costs (242) (29,847) (940) (31,095) Expansion costs (183) (128) (2,375) (128) Interest expense, net (5,430) (1,009) (15,693) (1,399) Loss on sale of assets (759) — (130) — Long-lived asset impairment — — (71,500) — Remeasurement of environmental liability — — (11,109) — Consolidated loss before income taxes $ (23,098) $ (12,885) $ (116,288) $ (5,959) March 31,September 30, 2022 and December 31, 2021:
Lives$ in thousands Estimated Useful
LivesSeptember 30, 2022 December 31, 2021 Plant infrastructure 10 years $ 10,226 $ 34,725 Miners 3 years 176,309 48,121 Miner facility infrastructure 10 years 32,368 15,143 Land N/A 8,460 8,460 Equipment 5 years 1,012 1,660 Software 3 years 636 636 Coal ash impoundment 4 years — 2,410 Construction in process N/A 26,076 25,856 Miner deposits N/A 27,281 98,110 282,368 235,121 Less: Accumulated depreciation (36,297) (18,030) $ 246,071 $ 217,091 $3.7$13.6 million and $1.3$2.7 million for the three months ended March 31,September 30, 2022 and 2021, respectively, and $22.0 million and $5.5 million for the nine months ended September 30, 2022 and 2021, respectively.The following is a summary of finite-lived intangible assets:9$ in thousands As of September 30, 2022 Intangible Assets Accumulated Amortization Intangible Assets, Net Customer relationships $ 3,320 $ (867) $ 2,453 Tradename 490 (102) 388 Total $ 3,810 $ (969) $ 2,841 As of December 31, 2021 Intangible Assets Accumulated Amortization Intangible Assets, Net Customer relationships $ 3,320 $ (244) $ 3,076 Tradename 490 (29) 461 Total $ 3,810 $ (273) $ 3,537 $ in thousands Amortization 2022 (for the remainder of) $ 232 2023 928 2024 928 2025 684 Thereafter 69 Total $ 2,841 7.$ in thousands Balance as of:
Rate
FinancingNote Loan Date Maturity Date Interest
RateAmount Financed September 30, 2022 December 31, 2021 Equipment Financings: A December 2020 June 2022 17.0 % $ 4,482 $ — $ 1,245 B December 2020 June 2022 17.0 % 428 — 95 C March 2021 November 2022 17.0 % 2,229 248 1,362 D April 2021 December 2022 17.0 % 4,012 669 2,674 E - H May 2021 October 2023 15.0 % 15,724 12,235 15,513 I July 2021 January 2023 17.0 % 4,457 1,238 3,468 J July 2021 March 2023 17.0 % 2,717 604 1,962 K October 2021 June 2023 17.0 % 2,223 864 1,976 L March 2022 April 2024 13.0 % 81,375 74,690 — Bonds Payable October 2021/December 2021 October 2026 8.5 % 72,200 72,200 72,200
December 2022Secured Promissory Note March 2022 June 2023 7.5 % 26,500 13,410 — Total debt Total debt 176,158 100,495 Less: Debt discount and issuance costs Less: Debt discount and issuance costs (6,425) (5,667) Total debt at book value Total debt at book value 169,733 94,828 Less: Current portion (73,218) (19,577) Long-term debt, net of current portion and deferred financing fees Long-term debt, net of current portion and deferred financing fees $ 96,515 $ 75,251 $3.4$5.4 million and $0.2$1.0 million during the three months ended March 31,September 30, 2022 and 2021, respectively, and $15.7 million and $1.4 million during the nine months ended September 30, 2022 and 2021, respectively, under the terms of these financings.$ in thousands Remainder of 2022 $ 20,404 2023 66,479 2024 17,075 2025 — 2026 72,200 Total $ 176,158 $81$81 million under loan schedules that were partially funded for approximately $54 million in March 2022, and will continue to be fundedwith additional funding of $17 million through September 30, 2022, to finance the acquisition of certain miners and related equipment (the “Financed Equipment”). The Borrowers' obligations under the NYDIG Financing13%13% per annum and have terms of twenty-five months. Certain loan schedules are interest-only for a specified period and otherwise payments on loan schedules include both an interest and principal payment. Pursuant to the terms of the NYDIG Financing Agreement, the Borrowers and with certain exceptions, the Company, will be subject to certain covenants and restrictive provisions which will, among other things: limit the Borrowers’ ability to incur additional indebtedness for borrowed money; limit additional liens on the collateral or the equity interests of any of the Borrowers; limit consolidations or mergers including the Borrowers or the Company unless such would not constitute a Change in Control (as defined therein); limit disposing of the collateral or any portion of the collateral with certain10Ona secured promissory note, as borrower,the Secured Promissory Note in favor of B. Riley Commercial Capital, LLC, as noteholder (the “Noteholder”), evidencing a $26.5 million aggregate principal amount loan by the Noteholder to Greenidge (the “Secured Promissory Note”).Noteholder. The Secured Promissory Note is guaranteed by certain of Greenidge’s wholly-owned subsidiaries: Greenidge South Carolina LLC, GSC RE LLC and 300 Jones Road LLC. The loan outstanding under the Secured Promissory Note bearsoriginally bore interest at a rate of 6%6% per annum and maturesoriginally matured on July 20, 2022, subject to up to five 30-day extensions, through December 2022, that may be elected by Greenidge provided no Event of Default (as defined therein) has occurred and is continuing and Greenidge pays an Exit Fee (as defined therein) to the Noteholder. Pursuant to the terms of the Secured Promissory Note, Greenidge and its subsidiaries will be subject to certain covenants and restrictive provisions which will, among other things, limit their ability to incur additional indebtedness for borrowed money or additional liens other than debt and liens permitted pursuant to the Secured Promissory Note; consolidate or merge unless Greenidge survives; or transfer all or substantially all of their assets; make certain restricted payments or investments; have a Change of Control (as defined therein); modify certain material agreements; and engage in certain types of transactions with affiliates; each of which are subject to customary and usual exceptions and baskets. The Secured Promissory Note is secured by a first priority mortgage lien on certain real property together with related improvements, fixtures and personal property located at Greenidge's South Carolina Facility. Greenidge’s obligations under the Secured Promissory Note may be prepaid in whole or in part without penalties or fees.$178.4$176.2 million and $169.9$139.2 million, respectively, at March 31,September 30, 2022. The notional value does not include unamortized discounts and debt issuance costs of $8.5$6.4 million at March 31,September 30, 2022. The estimated fair value of the Bonds Payable, representing the fair value of our 8.50%8.50% senior secured notes due 2026, was measured using quoted market prices at the reporting date. Such instruments were valued using Level 1 inputs. For the Equipment Financings and Secured Promissory Note, the Company believes the notional values approximate their fair values.Minimum future principal payments on debt as of March 31, 2022 were as follows:8.$5.0$5.0 million at March 31,September 30, 2022, payable to the NYSDEC.New York State Department of Environmentalliability.$3.6$3.6 million at March 31,September 30, 2022, payable to Empire Pipeline Incorporated (“Empire”) in the event the Company should not make contracted payments for costs related to a pipeline interconnection project the Company has entered into with Empire (see Note 13).$1.0$1.0 million.11Contents$500$500 million of shares of class A common stock, subject to certain limitations and conditions set forth in the 2021 Purchase Agreement, from time to time during the term of the 2021 Purchase Agreement. Under the applicable rules of The Nasdaq Stock Market LLC ("Nasdaq"), in no event may Greenidge issue to the Investor under the 2021 Purchase Agreement more than 19.99% of the total number of combined shares of its class A common stock and class B common stock (together, the "common stock") that were outstanding immediately prior to the execution of the 2021 Purchase Agreement (the “Exchange Cap”), unless Greenidge obtains stockholder approval to issue shares in excess of the Exchange Cap in accordance with applicable Nasdaq rules.electselected to sell to the Investor pursuant to the 2021 Purchase Agreement will bewere determined by reference to the volume weighted average price of class A common stock during the applicable purchase date on which Greenidge hashad timely delivered written notice to the Investor directing it to purchase shares under the 2021 Purchase Agreement, less a fixed 5%5% discount, which shallwas to be increased to a fixed 6%6% discount at such time that the Company receivesreceived aggregate cash proceeds of $200$200 million as payment for all shares of class A common stock purchased by the Investor in all prior sales of class A common stock made under the 2021 Purchase Agreement. The Investor will havehad no obligation to purchase shares pursuant to the 2021 Purchase Agreement to the extent that such purchase would causehave caused the Investor to own more than 4.99%4.99% of the Company’s issued and outstanding shares of class A common stock.20212022 Purchase Agreement, Greenidge entered into a Registration Rights Agreementregistration rights agreement with the Investor, pursuant to which Greenidge agreed to prepare and file a registration statement registering the resale by the Investor of those shares of theGreenidge’s class A common stock to be issued under the 20212022 Purchase Agreement. The registration statement became effective on October 6, 2021April 28, 2022 (the "Effective Date"), relating to the resale of 3,500,0005,720,951 shares of theGreenidge’s class A common stock in connection with the 20212022 Purchase Agreement. Duringthree months ended March 31,Effective Date to September 30, 2022, the CompanyGreenidge issued 415,0001,599,229 shares of class A common sharesstock to the Investor pursuant to the 20212022 Purchase Agreement for an aggregate sales priceproceeds of $3.9$5.0 million, net of discounts.10..threenine months ended March 31,September 30, 2022, the Company awarded 5,33555,870 restricted common stock units (“RSUs”) under the 2021 Equity Plan to employees, which are generally eligible to vest over a three-year period.threenine months ended March 31,September 30, 2022 is summarized below:RSUs Weighted Average
Grant Date
Fair ValueUnvested at December 31, 2021 516,987 $ 6.80 Granted 55,870 $ 5.70 Vested (90,704) $ 6.25 Unvested at September 30, 2022 482,153 $ 6.77 threenine months ended March 31,September 30, 2022, the fair market value of the awards granted totaled $0.1$0.3 million, and as of March 31,September 30, 2022, there was approximately $2.4$2.0 million of total unrecognized compensation cost related to unvested restricted stock rights, which is expected to be recognized over a remaining weighted-average vesting period of approximately 2.0 1.02 years.threenine months ended March 31,September 30, 2022 is summarized below:12Options Weighted Average
Exercise Price
Per ShareWeighted Average
Remaining
Contractual Life
(in years)Aggregate
Intrinsic
ValueOutstanding at December 31, 2021 583,080 $ 6.01 9.2 $ 5,854 Exercised (2,296) $ 6.25 Forfeited (9,554) $ 6.77 Expired (667) $ 6.25 Outstanding at September 30, 2022 570,563 $ 6.00 8.38 $ - Exercisable as of September 30, 2022 447,930 $ 5.89 8.35 $ 8,386 March 31,September 30, 2022, there was approximately $0.3$0.2 million of total unrecognized compensation cost related to unvested common stock options, which is expected to be recognized over a remaining weighted-average vesting period of approximately 1.4 1.49 years.$0.4$0.4 million and $0.7$0.4 million during the three months ended March 31,September 30, 2022 and 2021, respectively, and $1.0 million and $1.5 million during the nine months ended September 30, 2022 and 2021, respectively. Stock-based compensation expense is included in selling, general and11.46.2(0.3)% and 36.4(13.1)% for the three and nine months ended March 31,September 30, 2022, respectively.2021, respectively. due to continued reduced profitability as a result of the declines in bitcoin prices ,concluded that a valuation allowance should continue to be recognized for any deferred tax assets generated during the quarter. As a result there was no net income tax benefit for pretax losses of the U.S. operations in the three months ended September 30, 2022.threenine months ended March 31,September 30, 2022 was different from the U.S. federal statutory rate of 21%21% primarily due to state income taxesa charge of $15.0 million for the recognition of a valuation allowance during the second quarter of 2022 for deferred tax assets. Deferred tax assets primarily relate to historical net operating loss carryforwards of the Support.com business that was acquired in 2021.tax benefits associated with stock-based compensation.48.0% for the three and nine months ended September 30, 2021, respectively. The effective tax raterates for the three and nine months ended March 31,September 30, 2021 includesinclude the recognition of a deferred tax liability caused by the reorganization from a limited liability company to a corporation during the first quarter ofthree months ended March 31, 2021.The Company continues to evaluate the realizability of its deferred tax assets on a quarterly basis and will adjust such amounts in light of changing facts and circumstances. In making such an assessment, management would consider all available positive and negative evidence, including the level of historical taxable income, future reversals of existing temporary differences, tax planning strategies, and projected future taxable income.13Three Months Ended September 30: Nine Months Ended September 30: $ in thousands, except per share amounts 2022 2021 2022 2021 Numerator Net loss $ (23,177) $ (7,896) $ (131,488) $ (3,099) Less: Net income attributable to the member units before the reorganization — — — (648) Net loss attributable to Greenidge $ (23,177) $ (7,896) $ (131,488) $ (3,747) Denominator Basic weighted average shares outstanding 42,239 30,116 41,620 28,949 Diluted weighted average shares outstanding 42,239 30,116 41,620 28,949 (Loss) earnings per share Basic $ (0.55) $ (0.26) $ (3.16) $ (0.13) Diluted $ (0.55) $ (0.26) $ (3.16) $ (0.13) threenine months ended March 31,September 30, 2021, Basicbasic (loss) earnings per share is applicable only for the period from January 29, 2021 through March 31,September 30, 2021, which is the period following the reorganization of Greenidge Generation Holdings LLC (" GGH") into Greenidge and presents the period that the Company had outstanding common stock. Prior to the reorganization, there were 0no shares of common stock outstanding, and the limited liability structure of GGH consisted of member units. The Company analyzed the calculation of earnings per unit for periods prior to the reorganization and determined that it resulted in values that would not be meaningful to the users of these condensed consolidated financial statements.March 31,September 30, 2022,, there was 0no impact of dilution from any of the outstanding 431,618482,153 RSUs or 579,858570,563 common stock options due to the net loss, since inclusion of any impact from these awards would be antidilutive.March 31,September 30, 2021, there was 0 impactwere no shares excluded from the calculation of dilution from outstanding 616,920 RSUs or 330,744 common stock options,diluted earnings per share due to the net loss, since inclusion of any impact from these awards would be antidilutive.As of March 31, 2022, the Company had entered into agreements to purchase miners totaling $197.0 million that required deposits of $135.3 million. The Company entered into agreements for committed secured financing on miners totaling $27.7 million that has not yet been funded.$158 thousand$0.2 million per month. The contract ends in September 2030 and may be terminated by either party with 12 months' notice after the initial 10-year period.16%12% and 19%9% of itsconsolidated revenue for the three months ended March 31,September 30, 2022 and 2021, respectively.50%60% and 62% of total revenue for the three months ended March 31, 2022. Revenue from a different pool operator customer accounted for approximately 12% and 72% of total revenue for the three months ended March 31,September 30, 2022 and 2021, respectively, and 56% and 37% for the nine months ended September 30, 2022 and 2021, respectively.16%19% and 18% of the Company's consolidated revenue during the three and nine months ended March 31,September 30, 2022, respectively, and also accounted for approximately 73%69% and 67%67% of the Company's consolidated accounts receivable balance at March 31,September 30, 2022 and December 31, 2021, respectively. Another customer ofThe contract with the Support Services segment accounted for 11% of the receivable balance atsegment's largest customer expires on December 31, 2021.45%67% and 59%60% of the aggregate cost of revenue- cryptocurrency data center and cost of revenue- power and capacity for the three months ended September 30, 2022 and 2021, respectively and 64% and 59% of cost of revenue for the threenine months ended March 31,September 30, 2022 and 2021, respectively.Nine Months Ended September 30, $ in thousands 2022 2021 Shares issued to Support.com shareholders upon Merger $ — $ 93,885 Property and equipment purchases financed with common stock $ — $ 991 Contribution of Preferred Units, Senior Priority Units, and notes payable to related
party for Greenidge class B common stock$ — $ 72,891 Issuance of shares for investor fee associated with successful completion
of Merger$ — $ 17,826 Issuance of warrants to advisor in connection with completion of Merger $ — $ 8,779 May 16,November 14, 2022, the date at which the condensed consolidated financial statements were available to be issued, and the Company has concluded that no such events or transactions took place that would require disclosure herein except as stated directly below.PurchaseIncentive Plan of 280,000 restricted stock units that were fully vested at grant on October 10, 2022 and settle in twelve weekly installments beginning on October 14, 2022.Principal Capital, LLCIn April 2022, Greenidge and the Investor terminated the 2021 Purchase Agreement and entered into a new Purchase Agreement.As disclosed in Note 9, Greenidge entered into the 2021 Purchase Agreement with the Investor whereby the Company had the right to sell to the Investor a certain amount of its class A common stock, subject to certain conditions and limitations, from time to time during the term of the 2021 Purchase Agreement. Greenidge and the Investor entered into a mutual termination agreement on April 6, 2022 (the "Mutual Termination"), which became effective immediately upon signing. Prior to the termination, the Company had sold an aggregate of 2,547,500 shares of class A common stock pursuant to the 2021 Purchase Agreement representing proceeds of $54.9 million, net of discounts, under the 2021 Purchase Agreement. The Company did not incur any early termination penalties as a result of the Mutual Termination.On April 7 2022, Greenidge entered into a new common stock purchase agreement, as amended by Amendment No. 1 to Common Stock Purchase Agreement, dated as of April 13, 2022 (as amended, the “2022 Purchase Agreement”) with the Investor.Northland. Pursuant to the 2022 PurchaseATM Agreement, Greenidge has the right tomay offer and sell to the Investor up to $500 million in shares of its class A common stock subject to certain limitationshaving an aggregate offering price of $22,800,000. See Note 9, Stockholder's Equity.the satisfaction of specified conditions in the 2022 Purchase Agreement, from time to time over the 24-month period commencing on April 28, 2022. Under the applicable Nasdaq rules, unless stockholder approval is obtained, Greenidge may not sell more than 19.99%18% of the total number of shares of its class A common stockCompany's consolidated revenue during the three and class B common stock issued and outstanding immediately prior to the execution of thenine months ended September 30, 2022, Purchase Agreement, which number of shares shall be reduced on a share-for-share basis by the number of shares of class A common stock that may be aggregated with the transactions contemplated by the 2022 Purchase Agreement under the applicable Nasdaq rules. Sales of common stock pursuant to the 2022 Purchase Agreement,respectively.15and the timing of any sales, are solely at the option of the Company, and the Company is under no obligation to sell any securities to the Investor under the 2022 Purchase Agreement.In connection with the 2022 Purchase Agreement, Greenidge entered into a Registration Rights Agreement with the Investor, pursuant to which Greenidge agreed to prepare and file a registration statement registering the resale by the Investor of those shares of Greenidge’s class A common stock to be issued under the 2022 Purchase Agreement. The registration statement became effective on April 28, 2022, relating to the resale of 5,720,951 shares of Greenidge’s class A common stock in connection with the 2022 Purchase Agreement.From April 28, 2022 to May 16, 2022, we issued 15,000 shares of our class A common stock to the Investor pursuant to the Purchase Agreement for aggregate proceeds of approximately $0.1 million, net of discounts.16March 31,September 30, 2022 and 2021 included elsewhere in this Quarterly Report on Form 10-Q. This discussion contains certain forward-looking statements that reflect plans, estimates and beliefs and involve numerous risks and uncertainties, including but not limited to those described in the “Risk Factors” disclosed in Item 1A to Part I of Greenidge's Annual Report on Form 10-K for the year ended December 31, 2021 and “Cautionary Statement Regarding Forward-Looking Statements” sections of this Quarterly Report on Form 10-Q. Actual results may differ materially from those contained in any forward-looking statements. For purposes of this section, “the Company,” “we,” “us” and “our” refer to Greenidge Generation Holdings Inc. together with its consolidated subsidiaries).subsidiaries. You should carefully read “Cautionary Statement Regarding Forward-Looking Statements” in this Quarterly Report on Form 10-Q.facility that has undergone a remarkable transformation in recent years.facility. We generate all the power we require for our cryptocurrency datacenter operations in the New York Facility, where we enjoy low power costsrelatively lower market prices for natural gas due to our access to the Millennium Gas Pipeline price hub, which provides relatively low market rates for natural gas.hub. At the South Carolina Facility, we purchase power from a supplier of approximately 60% zero-carbon sourced energy.energy, which results in relatively stable energy cost environment. We believe our competitive advantages include relatively low fixed costs, an efficient mining fleet and in-house operational expertise. We are currently mining bitcoin and contributing to the security and transactability of the bitcoin ecosystem while concurrently supplying power to assist in meeting the power needs of homes and businesses in the region served by our New York Facility.March 31,September 30, 2022, we powered approximately 5676 MW of mining capacity capable of producing an estimated aggregate hash rate of 1.62.4 EH/s at our facilities, substantially all of which is dedicated to bitcoin mining. Our Cryptocurrency Datacenter and Power Generation segment generates revenue i) through the exchange of bitcoins earned by ASICsapplication-specific integrated circuit computers ("ASICs" or "miners") as rewards and transaction fees for U.S. dollars and, to a much lesser extent in 2021 through revenue earned from third parties for hosting ASICs owned by third parties and providing operations, maintenance and other blockchain related services to third parties and ii) through the sale of electricity generated by our power plant, and not consumed in cryptocurrency datacenter operations, to New York State’s power grid at prices set on a daily basis through the NYISONew York Independent System Operator ("NYISO") wholesale market. We opportunistically increase or decrease the total amount of electricity sold by the power plant based on prevailing prices in the wholesale electricity market.ourover the long-term, behind-the-meter power generation capability provides a stable, cost-effective source of power for cryptocurrency datacenter activities. Our behind-the-meter power generation capability provides us with stable delivery due to the absence of any contract negotiation risk with third-party power suppliers, the absence of transmission and distribution cost risk and the firm delivery of natural gas for our New York Facility via our captive pipeline. Furthermore, our New York Facility has operated with minimal downtime for maintenance and repairs over recent years. Notwithstanding the structural stability of our behind-the-meter capabilities, we do however procure natural gas at our New York Facility through a third-party energy manager which schedules delivery of our natural gas needs from the wholesale market which is subject to price volatility. We procure the majority of our natural gas at spot prices and enter into fixed price forward contracts from time to time for the purchase of a portion of anticipated natural gas purchases based on prevailing market conditions to partially mitigate the financial impacts of natural gas price volatility and to manage commodity risk. These forward contracts qualify for the normal purchases and sales exception under Accounting Standards Codification ("ASC") 815, Derivatives and Hedging, as it is probable that these contracts will result in physical delivery.mayhas impacted and will continue to impact our results of operations and financial performance. Natural gas prices have been on an upward trajectory since June of 2021 and are expected to continue at elevated levels during 2022. During 2022, the volatility in the cost of natural gas resulted in an approximate 121% increase in the weighted average cost of natural gas during the nine months ended September 30, 2022, as compared to the same period in the prior year. This is currently affecting, and has affected, the performance of our business. Volatility in the natural gas market may be caused by disruption in the delivery of fuel, including disruptions as a result of the outbreak or escalation of military hostilities, weather, transportation difficulties, global demand and supply dynamics, labor relations, environmental regulations or the financial viability of fuel suppliers. See “Risk Factors—Risks Related to Our Business—Risks Related to our Power Generation Operations” in Part I, Item 1A of our Annual Report on Form 10-K for the year ended December 31, 2021 and in this Quarterly Report on Form 10-Q..17Miner Fleet GrowthDuring the three months ended March 31, 2022, we deployed approximately 2,100 additional miners, bringing our total miners to approximately 19,400, capable of producing an estimated aggregate hash rate of approximately 1.6 EH/s and consuming56 MW. At March 31,2.4 EH/s from approximately 24,500 active miners at September 30, 2022. The Company is reevaluating its development plan as it works through its plans to improve liquidity.we had approximately 29,600the Company began to reduce its inventory of older, less efficient mining equipment in order to free up mining capacity for newer more, efficient miners ordered from Bitmain anticipatedin its order book. The Company expects this trend to be delivered bycontinue through the end of 2022, and the year, representing approximately 3.1 EH/sCompany may also consider other assets sales, including but not limited to sales of surplus mining infrastructure equipment, to further enhance its liquidity position.additional capacity, including our launch orderfull compliance with its existing Title V Air Permit, until four months after final resolution of the adjudicatory hearing process. While no adjudicatory proceedings have been scheduled to date, the Company expects that the appeals process may take a number of years to fully resolve.Bitmain’s new Antminer S19 XP.five-year terms, which include state and federal requirements applicable to the cooling water intake structure and discharges from the facility to the Keuka Lake Outlet and Seneca Lake. These new advanced miners have substantially greater hash rate capacitiespermits were renewed by NYSDEC prior to the September 30, 2022 expiration date. As part of this renewal the Company was granted an extension on installing the best technology available for cooling water intake structures until January 2023. The Company is in the process of installing these structures and use electric power more efficiently than our existing miner fleet.expects to meet the January deadline.table sets forth key components ofshould be read in conjunction with our condensed consolidated financial statements and related notes. All comparisons below refer to the results of operations of Greenidge duringthird quarter 2022 versus the three months ended March 31, 2022 and 2021.third quarter 2021, unless otherwise specified.
depreciation and amortization
shown below)Three Months Ended September 30, Variance $ in thousands 2022 2021 $ % Total revenue $ 29,359 $ 35,754 $ (6,395) (18) % Cost of revenue (exclusive of depreciation and amortization shown below) 22,095 9,659 12,436 129 % Selling, general and administrative expenses 10,240 5,446 4,794 88 % Merger and other costs 242 29,847 (29,605) (99 %) Depreciation and amortization 13,835 2,667 11,168 419 % Loss from operations (17,053) (11,865) (5,188) (44 %) Other (expense) income: Interest expense, net (5,430) (1,009) (4,421) (438 %) Gain on sale of digital assets — 18 (18) N/A Loss on sale of assets (759) — (759) N/A Other income (loss), net 144 (29) 173 N/A Total other expense, net (6,045) (1,020) (5,025) (493 %) Loss before income taxes (23,098) (12,885) (10,213) (79) % Provision (benefit) for income taxes 79 (4,989) 5,068 102 % Net loss $ (23,177) $ (7,896) $ (15,281) (194) % Adjusted Amounts (a) Adjusted (loss) income from operations $ (16,628) $ 18,110 $ (34,738) N/A Adjusted operating margin (56.6 %) 50.7 % Adjusted net (loss) income $ (21,993) $ 12,166 $ (34,159) N/A Other Financial Data (a) EBITDA (loss) $ (3,833) $ (9,209) $ 5,376 58 % as a percent of revenues (13.1 %) (25.8) % Adjusted EBITDA (loss) $ (2,288) $ 21,177 $ (23,465) N/A as a percent of revenues (7.8) % 59.2 % Three Months Ended
September 30,Variance $ in thousands 2022 2021 $ % Cryptocurrency datacenter $ 18,272 $ 31,156 $ (12,884) (41) % Power and capacity 3,613 3,077 536 17 % Services and other 7,474 1,521 5,953 391 % Total revenue $ 29,359 $ 35,754 $ (6,395) (18) % Revenue18Three Months Ended
September 30,2022 2021 Cryptocurrency datacenter 63 % 87 % Power and capacity 12 % 9 % Services and other 25 % 4 % Total revenue 100 % 100 % increased $26.6decreased $6.4 million, or 240.4%18%, to $29.4 million during the three months ended March 31,September 30, 2022 as compared to the prior year period. The increasedecrease in revenue was driven primarily bydue to the Cryptocurrency Datacenter and Power Generation segment, specificallyfollowing:significantly expanded miner fleet overwhich resulted in a 115% increase in hash rate from the last year. prior year comparative period.merger with Support.com, whereby GGH Merger Sub, Inc.Services and other segment included a full three months of operations in 2022 compared to 16 days of operations in 2021 following the acquisition on September 14, 2021. This resulted in an increase in revenue of $6.0 million, or 391%, a wholly owned subsidiary of Greenidge, merged with and into Support.com, Inc. (“Support.com”), with Support.com continuing as the surviving corporation (the “Merger”) and wholly-owned subsidiary of Greenidge, increased revenue $8.5to $7.5 million during the three month periodmonths ended March 31, 2022 as compared to the prior year period.September 30, 2022.Discussion"Results of Operations - Three Months Ended September 30" of this MD&A for a more detailed discussion of revenues from the Cryptocurrency Datacenter and Power Generation segment and the Support Services segment. Three Months Ended
September 30,Variance $ in thousands 2022 2021 $ % Cryptocurrency datacenter $ 14,675 $ 5,974 $ 8,701 146 % Power and capacity 3,760 2,831 929 33 % Services and other 3,660 854 2,806 329 % Total cost of revenue $ 22,095 $ 9,659 $ 12,436 129 % As a percentage of total revenue 75.3 % 27.0 % 261.1%$12.4 million, or 129%, to $16.6$22.1 million in the three months ended March 31,September 30, 2022 as compared to the prior year period. The following were the main contributors to the increase in cost of revenue:hours ("MWh"). Additionally, thehours.per MWh (exclusive of depreciation and amortization) increased significantly for both cryptocurrency datacenter operations and power and capacity operations primarily due to a significant increase in the natural gas cost per dekatherm, which increased approximately 83% in the three months ended March 31, 2022 as compared to the same period of 2021. The Merger added $4.1$2.8 million, to cost of revenue, or 88.9%329%, to total cost of revenue$3.7 million for the three months ended March 31,September 30, 2022 as compared to the prior year period.period primarily resulting from inclusion of the full three months of operations of Support.com in 2022 compared to only 16 days of operations included in the comparable period of the prior year.increasedwas significantly higher due primarily to the inclusion of the Support Services Segment, which operates at a lower margin than our Cryptocurrency Datacenter and Power Generation Segment, and also due to the impact of the higher cost of natural gas oncombined with the lower price of bitcoin in the Cryptocurrency Datacenter and Power Generation segment.$11.2$4.8 million, or 345.7%88%, to $10.2 million for the three months ended March 31,September 30, 2022 as compared to the prior year period primarily dueperiod. The main drivers of the increase in selling, general and administrative expenses were:costs related to operatingoperate as a public company as well as increases in order to match the growth in the operational footprint of the business.of corporate infrastructure to supportassociated with permit renewals and environmental matters at the Company’s growth, including $2.1 million ofNew York plant, legal and consulting costs related to assessingassociated with potential expansion opportunities costs of insurance, and wagesother accounting and consulting fees associated with increased headcount. In addition, the Mergerbeing a public company .$2.6$2.2 million of selling,to Selling, general and administrative expenses.expenses for the three months ended September 30, 2022 due to inclusion of the full three months of operations of Support.com in 2022 compared to only 16 days of operations included in the comparable period of the prior year.represented costs associated with the Merger, as well asincluded professional and other fees associated with the merger transaction and becoming a publicly tradedpublic company.$2.7$11.2 million, or 215.5%419%, to $13.8 million for the three months ended March 31,September 30, 2022 as compared to the prior year period primarily due to the purchase and deployment of additional miners.miners and associated infrastructure, as well as a change in depreciable lives effective July 1, 2022, resulting in higher depreciation expense. Additionally, the acquisition of19Support.comMerger increased depreciation and amortization by $0.3 million or 25.8%, for the three months ended March 31,September 30, 2022 as compared to the prior year period.Greenidge reported incomeof $2.5increased $5.2 million, or 44%, to $17.1 million for the three months ended March 31,September 30, 2022 as compared to $1.9the three months ended September 30, 2021. The increase is primarily related to lower cryptocurrency datacenter revenue as a result of lower bitcoin prices, increases to input costs for the Cryptocurrency and datacenter and Power and capacity segments as a result of higher natural gas costs, higher depreciation due to the expansion of the datacenter operations and higher selling, general and administrative costs.March 31, 2021. The increase in theSeptember 30, 2022 as compared to adjusted income from operations duringof $18.1 million in the three months ended March 31, 2022,September 30, 2021. The adjusted loss from operations was driven by the increased cryptocurrency datacenter operations, partially offset by the increased natural gas cost and higher costs to support our overall growth, including costs of being a public company, expansion costs and higher depreciation and amortization.Adjusted incomesame factors described above impacting loss from operations was $4.8 million for the three months ended March 31, 2022, an increase of 143.2% as compared to the same period of 2021. The improvement in adjusted operating income as compared to the same period of 2021 is primarily attributable to an increase in bitcoin mining hash rate, partially offset by higher costs, primarily the increased cost of natural gas and higher depreciation and amortization. Adjusted income from operations is a non-GAAP performance measure.operations. A reconciliation of reported amounts to adjusted amounts can be found in the "Non-GAAP Measures and Reconciliations" section of this MD&A.(expense) income,expense, netMarch 31,September 30, 2022, Greenidge incurred an increase of $5.0 million of other expense, as compared to other income in the same period of 2021, primarily due to increased interest expense associated with the incurrence of debt to finance the expansion of the mining fleet.fleet and, to a lesser extent, a loss on sale of assets.(Benefit) provisionbenefitprovision of $0.4$0.1 million, or an effective tax rate of 46.2%,(0.3)% during the three months ended March 31,September 30, 2022 and a provisionbenefit for income taxes of $0.7$(5.0) million, or an effective tax rate of 36.4%38.7%, during the three months ended March 31,September 30, 2021. The effective tax rate for the three months ended March 31,September 30, 2022 was different from the U.S. federal statutory rateimpacted by pretax losses with no associated income tax benefit as a result of 21% primarily due to state income taxes and tax benefits associated with stock-based compensation.a valuation allowance on net operating loss carryforwards. The effective income tax raterates for the three months ended March 31,September 30, 2021 includes the recognition of a deferred tax liability caused by the reorganizationbenefited from a limited liability company to a corporation duringhigher tax base for the first quarterdeductibility of 2021.(Loss) Income$0.4$23.2 million for the three months ended March 31,September 30, 2022 as compared to a net incomeloss of $1.3$7.9 million for the three months ended March 31,September 30, 2021.after-tax impact of the Merger-relatedmerger and other costs costs associated with becoming a public company and expansions costs, adjusted net (loss) income during the three months ended March 31,September 30, 2022 would have been $1.3$(22.0) million as compared to $1.4$12.2 million in the same period in 2021. Adjusted net (loss) income is a non-GAAP performance measure. A reconciliation of reported amounts to adjusted amounts can be found in the "Non-GAAP Measures and Reconciliations" section of this MD&A.DiscussionsegmentSegment Adjusted EBITDA provides a basis for the discussion that follows. Greenidge evaluates the performance of its reportable segments based on Adjusted EBITDA, which excludes items not indicative of ongoing20Three Months Ended
September 30,Variance $ in thousands 2022 2021 $ % REVENUE Cryptocurrency Datacenter and Power Generation $ 21,885 $ 34,233 $ (12,348) (36) % Support Services 7,474 1,521 5,953 391 % Total Revenue $ 29,359 $ 35,754 $ (6,395) (18) % SEGMENT ADJUSTED EBITDA Cryptocurrency Datacenter and Power Generation $ (3,669) $ 20,973 $ (24,642) N/A Support Services 1,381 204 1,177 577 % Total Adjusted EBITDA $ (2,288) $ 21,177 $ (23,465) N/A Reconciliation to loss before income taxes: Depreciation and amortization (13,835) (2,667) Stock-based compensation (361) (411) Merger and other costs (242) (29,847) Expansion costs (183) (128) Interest expense, net (5,430) (1,009) Loss on sale of assets (759) - Consolidated loss before income taxes $ (23,098) $ (12,885)
Power Generation
Power Generation
and amortization)
depreciation and amortization)21Three Months Ended
September 30,Variance $ in thousands, except $ per MWh and average bitcoin price 2022 2021 $ % Cryptocurrency datacenter $ 18,272 $ 31,156 (12,884) (41) % Power and capacity 3,613 3,077 536 17 % Total revenue $ 21,885 $ 34,233 (12,348) (36) % MWh Cryptocurrency datacenter 158,040 87,111 70,929 81 % Power and capacity 33,262 44,915 (11,653) (26 %) Revenue per MWh Cryptocurrency datacenter $ 116 $ 358 $ (242) (68 %) Power and capacity $ 109 $ 69 $ 40 58 % Cost of revenue (exclusive of depreciation and amortization) Cryptocurrency datacenter $ 14,675 $ 5,974 $ 8,701 146 % Power and capacity $ 3,760 $ 2,831 $ 929 33 % Cost of revenue per MWh (exclusive of depreciation and amortization) Cryptocurrency datacenter $ 93 $ 69 $ 24 35 % Power and capacity $ 113 $ 63 $ 50 79 % Cryptocurrency Datacenter Metrics Bitcoins produced 866 729 137 19 % Average bitcoin price $ 21,269 $ 41,937 (20,668) (49 %) Average hash rate (EH/s) 115 % Average difficulty 83 % revenueitsour cryptocurrency datacenter revenue, we generate electricity on-site from our power plant located at the New York Facility and use that electricity to power ASIC miners, generating bitcoin that we then exchange for U.S. dollars or hold in our wallet.dollars. Our cryptocurrency datacenter revenue increaseddecreased by $14.2$12.9 million, or 158.2%41%, during the three months ended March 31, 2022. SuchSeptember 30, 2022 as compared to the prior year period. The decrease was primarily attributable to the 49% decline in average bitcoin price as compared to the prior year. This decrease was partially offset by an increase was attributable toin hash rate from our increased mining fleet resulting in a 267.3%115% increase in the average hash rate during the three months ended March 31,September 30, 2022. The increased average hash rate, partially offset by a higher average mining difficulty, led to us producing 561866 bitcoins in the firstthird quarter of 2022 as compared to 213729 bitcoins in the firstthird quarter of 2021. The increased number of bitcoins produced partiallywas more than offset by the 49% lower average bitcoin price in 2022, resulted in the significant growthdecline in cryptocurrency datacenter revenue. revenueisis earned when we sell capacity and energy and ancillary services to the wholesale power grid managed by the NYISO. Through these sales, we earn revenue in three streams, including:streams: (1) power revenue received based on the hourly price of power, (2) capacity revenue for committing to sell power to the NYISO when dispatched and (3) other ancillary service revenue received as compensation for the provision of operating reserves. Our power and capacity revenue increased 186.7%$0.5 million, or 17%, to $5.9$3.6 million during the firstthird quarter of 2022 as acompared to the prior year as result of higher prices, signified by the higher power and capacity revenue per MWh, and an increase in volume, signified byselling price per MwH of 58% compared to the increase in power and capacity MWh. Due to more severe weathersame period in the month of January 2022prior year, offset by a 26% decline in MWhs provided to the power grid as compared to 2021, we curtailed cryptocurrency datacenter operations at the New York Facility for a period of time when there was a spike in power demand, which coincided with higher prices for electricity.increaseddecreased to $7.3$(3.7) million for the firstthird quarter of 2022 from $4.2$21.0 million in the firstthird quarter of 2021. The increase in segment Adjusted EBITDAvariance was driven by the significantdecline in the price of bitcoin and increase in cryptocurrency datacenter operations due to the expansion of our mining fleet, as well as the higher pricing for power during the first quarter of 2022 due to weather conditions in New York during January 2022. The increased revenue wasnatural gas input costs, partially offset by higher costs, including higher natural gas cost andthe increased administrative costs to support the business expansion.noonly 16 days of operations included in our consolidated results in the third quarter of 2021. Support Services had revenue of $7.5 million and Segment Adjusted EBITDA of $1.4 million in the three months ended September 30, 2022.Nine Months Ended
September 30,Variance $ in thousands 2022 2021 $ % Total revenue $ 98,353 $ 62,993 $ 35,360 56 % Cost of revenue (exclusive of depreciation and amortization shown below) 57,054 19,046 38,008 200 % Selling, general and administrative expenses 35,720 12,017 23,703 197 % Merger and other costs 940 31,095 (30,155) (97 %) Depreciation and amortization 22,680 5,531 17,149 310 % Impairment of long-lived assets 71,500 — 71,500 N/A Remeasurement of environmental liability 11,109 — 11,109 N/A (Loss) income from operations (100,650) (4,696) (95,954) 2043 % Other (expense) income: Interest expense, net (15,693) (1,377) (14,316) (1040) % Interest expense - related party — (22) 22 N/A (Loss) gain on sale of digital assets (15) 159 (174) N/A Loss on sale of assets (130) — (130) N/A Other income, net 200 (23) 223 N/A Total other expense, net (15,638) (1,263) (14,375) (1138 %) (Loss) income before income taxes (116,288) (5,959) (110,329) (1851) % Provision (benefit) for income taxes 15,200 (2,860) 18,060 N/A Net (loss) income $ (131,488) $ (3,099) $ (128,389) (4143 %) Adjusted Amounts (a) Adjusted (loss) income from operations $ (14,726) $ 26,527 $ (41,253) N/A Adjusted operating margin (15.0) % 42.1 % Adjusted net (loss) income $ (30,378) $ 17,868 $ (48,246) N/A Other Financial Data (a) EBITDA (loss) $ (77,915) $ 971 $ (78,886) N/A as a percent of revenues (79.2 %) 1.5 % Adjusted EBITDA $ 9,168 $ 33,668 $ (24,500) (73 %) as a percent of revenues 9.3 % 53.4 % Nine Months Ended
September 30,Variance $ in thousands 2022 2021 $ % Cryptocurrency datacenter $ 61,571 $ 54,217 $ 7,354 14 % Power and capacity 12,395 7,255 5,140 71 % Services and other 24,387 1,521 22,866 1503 % Total revenue $ 98,353 $ 62,993 $ 35,360 56 % Nine Months Ended
September 30,2022 2021 Cryptocurrency datacenter 62 % 86 % Power and capacity 13 % 12 % Services and other 25 % 2 % Total revenue 100 % 100 % Nine Months Ended
September 30,Variance $ in thousands 2022 2021 $ % Cryptocurrency datacenter $ 34,795 $ 11,504 $ 23,291 202 % Power and capacity 10,955 6,688 4,267 64 % Services and other 11,304 854 10,450 1224 % Total cost of revenue $ 57,054 $ 19,046 $ 38,008 200 % As a percentage of total revenue 58.0 % 30.2 % Nine Months Ended
September 30,Variance $ in thousands 2022 2021 $ % REVENUE Cryptocurrency Datacenter and Power Generation $ 73,966 $ 61,472 $ 12,494 20 % Support Services 24,387 1,521 22,866 1503 % Total Revenue $ 98,353 $ 62,993 $ 35,360 56 % SEGMENT ADJUSTED EBITDA Cryptocurrency Datacenter and Power Generation $ 3,886 $ 33,464 $ (29,578) (88 %) Support Services 5,282 204 5,078 2489 % Total Adjusted EBITDA $ 9,168 $ 33,668 $ (24,500) (73 %) Reconciliation to loss before income taxes: Depreciation and amortization (22,680) (5,531) Stock-based compensation (1,029) (1,474) Merger and other costs (940) (31,095) Expansion costs (2,375) (128) Interest expense, net (15,693) (1,399) Loss on sale of assets (130) — Long-lived asset impairment (71,500) — Remeasurement of environmental liabilities (11,109) — Consolidated loss before income taxes $ (116,288) $ (5,959) $ in thousands, except $ per MWh
and average bitcoin priceNine Months Ended
September 30,Variance 2022 2021 $ % Cryptocurrency datacenter $ 61,571 $ 54,217 $ 7,354 14 % Power and capacity 12,395 7,255 5,140 71 % Total revenue $ 73,966 $ 61,472 $ 12,494 20 % MWh Cryptocurrency datacenter 380,432 199,200 181,232 91 % Power and capacity 114,322 126,990 (12,668) (10 %) Revenue per MWh Cryptocurrency datacenter $ 162 $ 272 $ (110) (40 %) Power and capacity $ 108 $ 57 $ 51 89 % Cost of revenue (exclusive of depreciation and amortization) Cryptocurrency datacenter $ 34,795 $ 11,504 $ 23,291 202 % Power and capacity $ 10,955 $ 6,688 $ 4,267 64 % Cost of revenue per MWh (exclusive of depreciation and amortization) Cryptocurrency datacenter $ 91 $ 58 $ 33 57 % Power and capacity $ 96 $ 53 $ 43 82 % Cryptocurrency Datacenter Metrics Bitcoins produced 2,048 1,257 791 63 % Average bitcoin price $ 31,666 $ 44,614 $ (12,948) (29 %) Average hash rate (EH/s) 166 % Average difficulty 45 % quarternine months of 2021. Support Services had revenue of $8.5$24.4 million and segmentSegment Adjusted EBITDA of $1.9$5.3 million in the threenine months ended MarchSeptember 30, 2022.222021.2021 with the exception of those described below.ana limited liability company, public registration of shares and associated costs), business expansion costs, fair value adjustments for certain financial liabilities (including asset retirement obligations), costs associated with debt and equity transactions, and impairment charges as they are not indicative of business operations. Adjusted EBITDA is intended as a supplemental measure of our performance that is neither required by, nor presented in accordance with, GAAP. Management believes that the use of EBITDA and Adjusted EBITDA provides an additional tool for investors to use in evaluating ongoing operating results and trends and in comparing our financial measures with those of comparable companies, which may present similar non-GAAP financial measures to investors. However, you should be aware that when evaluating EBITDA and Adjusted EBITDA, we may incur future expenses similar to those excluded when calculating these measures. In addition, our presentation of these measures should not be construed as an inference that its future results will be unaffected by unusual or non-recurring items. Our computation of Adjusted EBITDA may not be comparable to other similarly titled measures computed by other companies, because all companies may not calculate Adjusted EBITDA in the same fashion.23Three Months Ended
September 30,Nine Months Ended
September 30,$ in thousands 2022 2021 2022 2021 Adjusted operating income (loss) (Loss) income from operations $ (17,053) $ (11,865) $ (100,650) $ (4,696) Merger and other costs 242 29,847 940 31,095 Expansion costs 183 128 2,375 128 Impairment of long-lived assets — — 71,500 — Remeasurement of environmental liability — — 11,109 — Adjusted (loss) income from operations $ (16,628) $ 18,110 $ (14,726) $ 26,527 Adjusted operating margin (56.6 %) 50.7 % (15.0) % 42.1 % Adjusted net (loss) income Net loss $ (23,177) $ (7,896) $ (131,488) $ (3,099) Merger and other costs, after tax 242 19,969 940 20,874 Expansion costs, after tax 183 93 2,375 93 Loss on sale of assets, after tax 759 — 130 — Impairment of long-lived assets, after tax — — 71,500 — Remeasurement of environmental liability, after tax — — 11,109 — Tax charge for valuation allowance — — 15,056 — Adjusted net (loss) income $ (21,993) $ 12,166 $ (30,378) $ 17,868 EBITDA (loss) and Adjusted EBITDA (loss) Net loss $ (23,177) $ (7,896) $ (131,488) $ (3,099) Provision for income taxes 79 (4,989) 15,200 (2,860) Interest expense, net 5,430 1,009 15,693 1,399 Depreciation and amortization 13,835 2,667 22,680 5,531 EBITDA (loss) (3,833) (9,209) (77,915) 971 Stock-based compensation 361 411 1,029 1,474 Merger and other costs 242 29,847 940 31,095 Expansion costs 183 128 2,375 128 Loss on sale of assets 759 — 130 — Impairment of long-lived assets — — 71,500 — Remeasurement of environmental liability — — 11,109 — Adjusted EBITDA (loss) $ (2,288) $ 21,177 $ 9,168 $ 33,668 March 31,September 30, 2022, we had cash and cash equivalents and restricted cash of $96.5$38.5 million. To date, we have primarily relied on debt and equity financing to fund our operations and to meet ongoing working capital needs and to execute on the initial stages of our business plan. During the first quarternine months of 2022, we obtained approximately $108$110.3 million of additional committed financings of which approximately $81 million was funded during March 2022, through two different agreements described further below.March 31,September 30, 2022, our current business strategy is to sell digital assets within a short period after earning such assets. We may choose to change this strategy in the future. The average period between receipt of bitcoin and the subsequent conversion to cash is less than one day because at least 95% of the bitcoin mined each day is liquidated the same day it is mined. Our liquidity is subject to volatility in both number of bitcoins mined and the underlying price of bitcoin.March 31,September 30, 2022, and the years in which these obligations are due:
commitments
retirement obligations$ in thousands Total Remainder of 2022 2023-2024 2025-2026 Thereafter Debt payments $ 212,089 $ 24,824 $ 102,791 $ 84,474 $ - Leases 273 32 241 — — Environmental obligations 22,415 — 16,500 5,915 — Natural gas transportation 15,168 474 3,792 3,792 7,110 Total $ 249,945 $ 25,330 $ 123,324 $ 94,181 $ 7,110 At March 31, 2022, we had $135.3 million Environmental obligations are based on estimates subject to various assumptions including, but not limited to, closure and post-closure cost estimates, timing of cash on deposit for future miner purchasesexpenditures, escalation factors, and have significant future commitments relatedrequirements of granted permits. Additional adjustments to these purchases includedthe environment liability may occur periodically due to potential changes in the table above. remediation requirements regarding coal combustion residuals which may lead to material changes in estimates and assumptions.gas; therefore,gas, and based on the current price of bitcoin and electricity cost, we mayexpect that we will require additional capital in order to meet the commitments above. Management believes that our existing financial resources, combined with ourDuring the nine months ended September 30, 2022, the Company’s profit and cash flows were impacted significantly by volatility in the prices of bitcoin and natural gas. The ability to delay continue as a going concern is dependent upon the Company generating profitable operations in the future and/or alter our planned expansion steps, are sufficientobtaining the necessary financing to meet ourits obligations and repay its liabilities arising from normal business operations when they come due. Management has evaluated different options to improve its liquidity to fund the Company’s expenses and to support the Company’s debt servicing requirements. These options include, but are not limited to:and capital requirements for at least 12 months fromrevenue, the dateestimated amount of required liquidity will vary significantly. Similarly, management cannot predict when or if bitcoin prices will recover to prior levels, or when energy costs may decrease. While the Company continues to work to implement the options to improve liquidity, there can be no assurance that these condensed consolidated financial statements are issued. This is predicated on us achieving our forecast whichefforts will be successful.ourits control, in particular, significant decreases in the price of bitcoin, regulatory changes concerning cryptocurrency, increases in energy costs or other macroeconomic conditions (including if further COVID-19 outbreaks require further statewide shutdowns) and the other matters identified in Part I, Item 1A "Risk Factors" of our Annual Report on Form 10-K for the year ended December 31, 2021.2021 and Part II, Item 1A "24(in thousands) for the threenine months ended March 31,September 30, 2022 and 2021. Nine Months Ended
September 30,$ in thousands 2022 2021 Net cash (used for) provided by operating activities $ (1,226) $ 26,666 Net cash used in investing activities (122,076) (38,644) Net cash provided by financing activities 79,216 58,075 Net change in cash and cash equivalents and restricted cash (44,086) 46,097 Cash and cash equivalents at beginning of year 82,599 5,052 Cash and cash equivalents and restricted cash at end of period $ 38,513 $ 51,149 $6.3$(1.2) million for the threenine months ended March 31,September 30, 2022, as compared to $2.5$26.7 million for the threenine months ended March 31,September 30, 2021. The increasevariance in the operating cash flow during the first threenine months of 2022 as compared to 2021 was driven primarily by benefits from working capital as accounts payablethe lower profits caused by the decrease in the price of bitcoin and accrued expenses increased more significantlythe higher cost of power in 2022 than in 2021.$70.6$122.1 million for the threenine months ended March 31,September 30, 2022, as compared to $5.7$38.6 million for the threenine months ended March 31,September 30, 2021. For the threenine months ended March 31,September 30, 2022, purchases of and deposits for property and equipment significantly increased as compared to the prior year due to the expansion of our miner fleet and infrastructure for cryptocurrency mining.$78.2$79.2 million for the threenine months ended March 31,September 30, 2022, as compared to $37.3$58.1 million for the threenine months ended March 31,September 30, 2021. For the threenine months ended March 31,September 30, 2022, the net cash provided by financing activities primarily consisted of $80.4$107.1 million of net proceeds from debt and $3.8$7.8 million of net proceeds from issuance of common stock, net of issuance costs, partially offset by $5.9$35.3 million of payments of debt principal and finance lease obligations.principal. For the first threenine months ofended September 30, 2021, the net cash provided by financing activities consisted of $37.1$0.8$4.4 million of principal payments on debt. that were partially funded for approximately $54.0 million in March 2022 and will continue to be funded to finance the acquisition of certain bitcoin miners and related equipment (the “Financed Equipment”). The Borrower’s obligations under the NYDIG Financing Agreement are fully and unconditionally guaranteed by Greenidge. Outstanding borrowings under the NYDIG Financing Agreement are secured by all assets of the Borrowers including without limitation the Financed Equipment and proceeds thereof (including bitcoin). The partially funded loan schedules bear interest at a rate of 13% per annum and have terms of twenty-five months. Certain loan schedules are interest-only for a specified period and otherwise payments on loan schedules include both an interest and principal payment.maturesoriginally matured on July 20, 2022, subject to up to five 30-day extensions that may be elected by Greenidge provided no Event of Default (as defined therein) has occurred and is continuing and Greenidge pays an Exit Fee (as defined therein) to the Noteholder. The Secured Promissory Note is secured by a first priority mortgage lien on certain real property together with related improvements, fixtures and personal property located at the South Carolina Facility. Greenidge’s obligations under the Secured Promissory Note may be prepaid in whole or in part without penalties or fees.formQuarterly Report on Form 10-Q for a further discussion of the Company's debt.25Contentsour class A common stock requested to be sold by us, consistent with its normal trading and sales practices, under the terms and subject to the conditions set forth in the ATM Agreement. B. Riley may sell our class A common stock by any method permitted by law deemed to be an “at the market offering” as defined in Rule 415(a)(4) promulgated under the Securities Act. Greenidge will pay B. Riley commissions for its services in acting as sales agent in the sale of our class A common stock. B. Riley will be entitled to compensation in an amount equal to up to 5.0% of the gross proceeds of all class A common stock sold through it as sales agent under the ATM Agreement. Under the registration statement filed registering shares to be sold under the ATM Agreement, In no event shall Greenidge issue or sell through B. Riley such number of Placement Shares that exceeds up to a maximum aggregate offering price of $22,800,000 of class A common stock of Greenidge.Off-Balance Sheet ArrangementsNone.26March 31,September 30, 2022, that the disclosure controls and procedures are effective in ensuring that all material information required to be filed in this Quarterly Report on Form 10-Q has been recorded, processed, summarized and reported when required and the information is accumulated and communicated to the Company’s management, including its Chief Executive Officer and Chief Financial Officer, as appropriate, to allow timely decisions regarding required disclosure.firstthird quarter of 2022 that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.challengedchallenges the Town of Torrey’s site plan review for the planned expansion of our cryptocurrency datacenter in the Town of Torrey.datacenter. We were joined in the petition as a necessary party. The petition asserted two errors by the Town of Torrey in its review of the site plan. In April, 2022, the Supreme Courtasserts, among other things, a violation of the State of New York Yates CountyEnvironmental Quality Review Act for failing to identify all areas of environmental concern or appropriately review the potential environmental impacts of the planned expansion of our data center. On April 7, 2022, the Supreme Court denied the parties’ petition.petition with prejudice, upholding the Town of Torrey’s site plan review on multiple, independent grounds. A notice of appeal was filed but the appeal was not perfected by the October 20, 2022 deadline; therefore, the appeal is deemed abandoned.includes a discussionand this section entitled "Risk Factors" of our risk factors which are incorporated herein. Through the quarterly period covered by this report, there have been no material changes to the risk factors disclosed in Greenidge's AnnualQuarterly Report on Form 10-K10-Q. Given the lack of improvement in the above mentioned factors in the third quarter of 2022, there is uncertainty regarding our financial condition and substantial doubt about our ability to continue as a going concern for a reasonable period of time.year ended December 31, 2021.planned expansion of our cryptocurrency datacenter. We were joined in the petition as a necessary party. The petition asserted, among other things, a violation of the State of New York Environmental Quality Review Act for failing to identify all areas of environmental concern or appropriately review the potential environmental impacts of the planned expansion of our data center. On April 7, 2022, the Supreme Court denied the petition with prejudice, upholding the Town of Torrey’s site plan review on multiple, independent grounds. A notice of appeal was filed but the appeal was not perfected by the October 20, 2022 deadline; therefore, the appeal is deemed abandoned.From time to time, we may become involved in various legal proceedings that arise in the ordinary course of businessOn September 15, 2021, we entered into a purchase agreement (the “2021 Purchase Agreement”), with B. Riley Principal Capital, LLC (“BRPC”) pursuant to which we had the right to sell to BRPC up to $500 million in shares of class A common stock, subject to certain limitations and the satisfaction of specified conditions in the 2021 Purchase Agreement, from time to time over the 24-month period commencing on October 6, 2021. On April 6, 2022, we and BRPC mutually agreed to terminate the 2021 Purchase Agreement, effective immediately on such date. From January 1, 2022 to April 6, 2022, we issued 415,000 shares of our class A common stock to BRPC under the Purchase Agreement. We intend to use the net proceeds for general corporate purposes, including funding capital expenditures, future acquisitions, investments and working capital and repaying indebtedness.BRPC,B. Riley Principal Capital, LLC (“BRPC”), pursuant to which we have the right to sell to BRPC up to $500 million in shares of class A common stock, subject to certain limitations and the satisfaction of specified conditions in the 2022 Purchase Agreement, from time to time over the 24-month period commencing on April 28, 2022. From April 28, 2022 to May 16,November 11, 2022, we issued 15,0003,234,193 shares of our class A common stock to BRPC under the 2022 Purchase Agreement. We intend to use the net proceeds if any, for general corporate purposes, including funding capital expenditures, future acquisitions, investments and working capital and repaying indebtedness.10.1+3.1Secured10.110.310.3 10.5+Certain schedules and exhibits have been omitted pursuant to Item 601(a)(5) or Item 601(b)(2) of Regulation S-K. We hereby undertake to furnish copies of the omitted schedule or exhibit upon request by the Securities and Exchange Commission.May 16,November 14, 2022Jeffrey E. KirtDavid AndersonJeffrey E. Kirt May 16,November 14, 202230