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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

 

 

FORM 8-K

 

 

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): October 30, 2024

 

 

CleanSpark, Inc.

(Exact name of Registrant as Specified in Its Charter)

 

 

 

Nevada   001-39187   87-0449945
(State or Other Jurisdiction
of Incorporation)		   (Commission
File Number)		   (IRS Employer
Identification No.)

 

10624 S. Eastern Ave.

Suite A - 638

  
Henderson, Nevada     89052
(Address of Principal Executive Offices)     (Zip Code)

Registrant’s Telephone Number, Including Area Code: (702) 989-7692

(Former Name or Former Address, if Changed Since Last Report)

 

 

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

 

☐

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

 

☐

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

 

☐

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

 

☐

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

 

Title of each class

  

Trading
Symbol(s)

  

Name of each exchange
on which registered

Common Stock, par value $0.001 per share   CLSK   The Nasdaq Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§ 230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§ 240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

 

 

 

Item 7.01 Regulation FD Disclosure

On October 31, 2024, CleanSpark, Inc. (the “Company”) issued a press release announcing the completion of the merger described under Item 8.01 below. A copy of this press release is attached as Exhibit 99.1 and is being furnished with this Current Report on Form 8-K.

The information in this Item 7.01 of this Current Report on Form 8-K (including Exhibit 99.1) shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed incorporated by reference in any filing under the Securities Act of 1933, as amended, or the Exchange Act, except as expressly set forth by specific reference in such a filing.

Item 8.01 Other Events

Completion of Merger

On October 30, 2024 (the “Closing Date”), the Company completed its previously announced acquisition of GRIID Infrastructure Inc., a Delaware corporation (“GRIID”), pursuant to the Agreement and Plan of Merger (“Merger Agreement”), dated as of June 26, 2024, by and among the Company, Tron Merger Sub Inc., a Delaware corporation and a wholly owned subsidiary of the Company (“Merger Sub”), and GRIID. On the Closing Date, pursuant to the Merger Agreement and upon the terms and conditions set forth therein, Merger Sub merged with and into GRIID, with GRIID as the surviving corporation and a wholly owned subsidiary of the Company (the “Merger”).

Pursuant to the Merger Agreement, at the effective time of the Merger (the “Effective Time”), each share of common stock, par value $0.0001 per share, of GRIID (“GRIID Common Stock”) issued and outstanding immediately prior to the Effective Time, including each share underlying a GRIID restricted stock unit award or option to purchase shares of GRIID Common Stock pursuant to the terms described below, was canceled and automatically converted into the right to receive from the Company 0.069593885 (the “Exchange Ratio”) of a fully paid and nonassessable share of common stock, par value 0.001 per share, of the Company (“Company Common Stock”). As a result, an aggregate of 5,031,254 shares of Company Common Stock were issued in the Merger. Holders of GRIID Common Stock are entitled to receive cash (without interest) in lieu of fractional shares of Company Common Stock in accordance with the terms of the Merger Agreement.

Pursuant to the Merger Agreement, at the Effective Time:

 

  •  

each GRIID restricted stock unit award that was outstanding immediately prior to the Effective Time immediately vested with respect to 100% of the shares of GRIID Common Stock subject to such GRIID restricted stock unit award, which shares of GRIID Common Stock were converted into the right to receive the merger consideration with respect to each share of GRIID Common Stock. Further, each outstanding vested compensatory option to purchase shares of GRIID Common Stock was canceled and converted into the right to receive approximately 0.01 of a share of Company Common Stock, which is the number of shares equal to the quotient of (i) the product of (A) the excess, if any, of the Merger Consideration Value (as defined below) over the per share exercise price of the applicable option, multiplied by (B) the number of shares of GRIID Common Stock subject to such option immediately prior to the Effective Time, divided by (ii) $16.587, which represents the volume-weighted average price of Company Common Stock for the two consecutive trading days prior to the date of the Merger Agreement. Any GRIID options that had an exercise price per share of GRIID Common Stock that was equal to or greater than the Merger Consideration Value were canceled for no consideration; and

 

  •  

each outstanding and unexercised warrant (each, a “GRIID Warrant”) to purchase shares of GRIID Common Stock of GRIID was converted into a warrant to purchase a number of shares of Company Common Stock (each, a “Company Warrant”), rounded down to the nearest whole share, that is equal to the product of (A) the number of shares of GRIID Common Stock subject to such GRIID Warrant as of immediately prior to the Effective Time, multiplied by (B) the Exchange Ratio. The exercise price per share of Company Common Stock underlying such converted Company Warrant is equal to the quotient obtained by dividing (x) the per share exercise price applicable to such warrant immediately prior to the Effective Time by (y) the Exchange Ratio, rounded up to the nearest whole cent. Each such Company Warrant is on the same terms and conditions as were applicable under such GRIID Warrant immediately prior to the Effective Time, except for such terms rendered inoperative by reason of the Merger or as otherwise set forth in the Merger Agreement or in the

 

applicable warrant agreement with respect to such GRIID Warrant and subject to such adjustments as reasonably determined by the Company and GRIID to be necessary or appropriate to give effect to the conversion or the Merger.

The term “Merger Consideration Value” means the product of (x) the Exchange Ratio multiplied by (y) $16.587.

The issuance of shares of Company Common Stock in connection with the Merger was registered under the Securities Act of 1933, as amended (the “Securities Act”), pursuant to the Company’s registration statement on Form S-4 (File No. 333-281313), filed with the Securities and Exchange Commission on August 6, 2024, as amended on September 10, 2024, and declared effective on September 23, 2024 (the “Registration Statement”). The proxy statement/prospectus included in the Registration Statement contains additional information about the Merger.

The foregoing description of the Merger Agreement and the related transactions (including, without limitation, the Merger) does not purport to be complete and is subject to and qualified in its entirety by reference to the full text of the Merger Agreement, a copy of which is filed as Exhibit 2.1 and incorporated herein by reference, and to the information contained in the Registration Statement.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

 

        CLEANSPARK, INC.
Date: October 31, 2024       By:  

/s/ Zachary Bradford

        Name: Zachary Bradford
Title:  Chief Executive Officer

Exhibit 99.1

CleanSpark Completes Acquisition of GRIID Infrastructure Inc.

Action comes following approval of merger by GRIID shareholders in October 28th vote

CleanSpark expects to grow to over 400 MW of mining capacity in Tennessee

LAS VEGAS, October 31, 2024 – CleanSpark, Inc. (Nasdaq: CLSK), America’s Bitcoin Miner® (the “Company”), announced today the completed acquisition of GRIID Infrastructure Inc. (Nasdaq: GRDI) (“GRIID”) on October 30, 2024, following approval of the transaction by stockholders of GRIID at the special meeting of its stockholders on October 28, 2024.

“I’m pleased to announce the completion of our acquisition of GRIID Infrastructure Inc., a strategic move that allows us to grow our Bitcoin mining capacity in the state of Tennessee, which we intend to build to over 400 MW in the coming years,” said CleanSpark CEO Zach Bradford. “Moreover, this adds significant geographic and power supply diversity through expansion in the Tennessee Valley Authority (TVA) service territory, providing us with additional operational flexibility.”

“We look forward to smoothly integrating GRIID’s team into ‘The CleanSpark Way,’ merging their impressive workforce with our own. We’ve gotten to know GRIID’s employees well in the past three months as we have prepared for the merger and they have hosted 50 MW of mining capacity for us. The fit couldn’t be better, and we are collectively ready to hit the ground running with GRIID’s existing capacity, new development in TVA, and additional talent supporting our previously acquired sites in the state,” said Bradford.

“I’m proud to welcome CleanSpark to Tennessee,” said U.S. Senator Bill Hagerty (R-TN). The Volunteer State is a great place to grow a business and has rapidly developed into one of the centers of America’s Bitcoin industry. We boast a globally competitive workforce, a superior quality of life, and thanks to TVA, reliable and affordable power. We are excited to see CleanSpark grow and invest in Tennessee.”

“The closing of the merger is a great outcome for GRIID’s shareholders and employees,” said GRIID’s former CEO Trey Kelly. “It’s great to start the next chapter, and merging with CleanSpark is a tribute to the business we’ve built with some of the best Bitcoin mining professionals in the world. CleanSpark has already begun demonstrating their ability to accelerate and maximize the value of GRIID’s power pipeline, and I see tremendous upside for the combined company in the years to come.”

Under the terms of the merger agreement originally announced on June 27, 2024, each share of GRIID common stock was converted into approximately 0.06959 of a share of CleanSpark common stock at the effective time of the merger.

In connection with the closing of the transaction, GRIID has requested that Nasdaq suspend trading of the GRIID common stock and GRIID public warrants on Nasdaq prior to the opening of trading on October 31, 2024. The shares of GRIID common stock are expected to be delisted from Cboe Canada at the end of the day on October 31, 2024.

Advisors

Cozen O’Connor P.C. served as legal counsel for CleanSpark and Troutman Pepper Hamilton Sanders LLP served as legal counsel for GRIID in connection with the transaction.

About CleanSpark

CleanSpark (Nasdaq: CLSK) is America’s Bitcoin Miner®. We own and operate multiple data centers that primarily run on low-carbon power. Our infrastructure responsibly supports Bitcoin, the world’s most important digital commodity and an essential tool for financial independence and inclusion. We cultivate trust and transparency among our employees and the communities we operate in. Visit our website at www.cleanspark.com.

Forward-Looking Statements

This press release includes “forward-looking statements” as defined under the federal securities laws. All statements other than statements of historical fact included in this press release, including, among other things, statements regarding the business combination transaction between CleanSpark and GRIID, future events, plans and anticipated results of operations, business strategies, the anticipated benefits of the transaction, the anticipated impact of the transaction on CleanSpark’s business and future financial and operating results, the expected amount and timing of synergies from the transaction and other aspects of CleanSpark’s operations or operating results are forward-looking statements. Words and phrases such as “ambition,” “anticipate,” “estimate,” “believe,” “budget,” “continue,” “could,” “intend,” “may,” “plan,” “potential,” “predict,” “seek,” “should,” “will,” “would,” “expect,” “objective,” “projection,” “forecast,” “goal,” “guidance,” “outlook,” “effort,” “target” and other similar words can be used to identify forward-looking statements. However, the absence of these words does not mean that the statements are not forward-looking. Where, in any forward-looking statement, CleanSpark expresses an expectation or belief as to future results, such expectation or belief is expressed in good faith and believed to be reasonable at the time such forward-looking statement is made. However, these statements are not guarantees of future performance and involve certain risks, uncertainties and other factors beyond CleanSpark’s control. Therefore, actual outcomes and results may differ materially from what is expressed or forecast in the forward-looking statements.

The following important factors and uncertainties, among others, could cause actual results or events to differ materially from those described in forward-looking statements: CleanSpark’s ability to successfully integrate GRIID’s businesses and technologies, which may result in the combined company not operating as effectively and efficiently as expected; the risk that the expected benefits and synergies of the transaction may not be fully achieved in a timely manner, or at all; the risk of potential litigation relating to the transaction that could be instituted against CleanSpark or its directors; the risk that CleanSpark will be unable to retain and hire key personnel; unanticipated difficulties,

liabilities or expenditures relating to the transaction; the effect of the transaction on CleanSpark’s common stock price and uncertainty as to the long-term value of CleanSpark common stock; risks that the transaction disrupts current plans and operations of CleanSpark and its management team and potential difficulties in hiring or retaining employees as a result of the transaction; reliance on a limited number of key employees; the availability of financing opportunities and risks associated with economic conditions; dependency on continued growth in blockchain and bitcoin usage; anticipated additions to CleanSpark’s hashrate and the timing thereof; the risk that the electrical power available to CleanSpark’s facilities does not increase as expected; the success of CleanSpark’s digital currency mining activities; the volatile and unpredictable cycles in the emerging and evolving industries in which CleanSpark operate; increasing difficulty rates for bitcoin mining; bitcoin halving; changes in network and infrastructure; new or additional governmental regulation; the anticipated delivery dates of new miners; the ability to successfully deploy new miners; the dependency on utility rate structures and government incentive programs; dependency on third-party power providers for expansion efforts; the expectations of future revenue growth and ability to execute on business strategy; CleanSpark’s ability to remediate the material weakness identified in the internal control over financial reporting included in its Annual Report on Form 10-K for the fiscal year ended September 30, 2023; global and regional changes in the demand for the services of CleanSpark, including the conflicts in Ukraine and the Middle East, and the global response to such conflict, security threats on facilities and infrastructure; insufficient liquidity; unexpected cost increases, inflationary pressures or technical difficulties in constructing, maintaining or modifying company facilities; legislative and regulatory initiatives addressing global climate change or other environmental concerns; public health crises, including pandemics (such as COVID-19) and epidemics and any impacts or related company or government policies or actions; international monetary conditions and exchange rate fluctuations; CleanSpark’s ability to complete any other announced or any other future dispositions or acquisitions on time, if at all; security and cybersecurity threats and hacks; dependency on third parties to maintain cold and hot wallets that hold CleanSpark’s bitcoin; the expectations of future revenue growth and ability to execute on CleanSpark’s business strategy; and other economic, business, competitive and/or regulatory factors affecting CleanSpark’s business generally as set forth in its filings with the SEC. For additional information about other factors that could cause actual results to differ materially from those described in the forward-looking statements, please refer to CleanSpark’s periodic reports and other filings with the SEC, including the risk factors contained in CleanSpark’s most recent Quarterly Reports on Form 10-Q and Annual Report on Form 10-K for the fiscal year ended September 30, 2023, and any subsequent filings with the SEC. Forward-looking statements represent current expectations and are inherently uncertain and are made only as of the date hereof (or, if applicable, the dates indicated in such statement). Forward-looking statements contained herein are made only as to the date of this press release, and CleanSpark assumes no obligation to update or revise any forward-looking statements as a result of any new information, changed circumstances or future events or otherwise, except as required by applicable law.

Investor Relations Contact

Brittany Moore

702-989-7693

ir@cleanspark.com

Media Contact

Eleni Stylianou

702-989-7694

pr@cleanspark.com

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Oct. 30, 2024
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Document Type 8-K
Document Period End Date Oct. 30, 2024
Entity Registrant Name CleanSpark, Inc.
Entity Incorporation State Country Code NV
Entity File Number 001-39187
Entity Tax Identification Number 87-0449945
Entity Address, Address Line One 10624 S. Eastern Ave.
Entity Address, Address Line Two Suite A - 638
Entity Address, City or Town Henderson
Entity Address, State or Province NV
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Security 12b Title Common Stock, par value $0.001 per share
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Entity Emerging Growth Company false
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