Applied Digital Issues $50 Million Unsecured Convertible Debenture to Advance HPC Data Center Project in Ellendale, North Dakota
DALLAS, April 01, 2024 (GLOBE NEWSWIRE) — Applied Digital Corporation (Nasdaq:APLD) (“Applied Digital” or the “Company”), a designer, builder, and operator of next-generation digital infrastructure designed for High-Performance Computing (“HPC”) applications, announced that the Company recently entered into a private financing agreement with a single investor (the “Investor”), in which it issued a $50 million unsecured convertible debenture. The convertible debenture bears no interest, has an original issue discount of five percent and has a term of 54 weeks. The conversion price for the note is the lower (a) $6.00 and (b) 95% of the lowest daily volume weighted average price of the Company’s common stock during the five trading days immediately prior to the date of conversion, subject to a floor price of $3.00, except that the Investor may, at its option, elect to use the $6.00 fixed conversion price. The Investor is limited to converting no more than $9.0 million per month, and may only begin to convert after May 1, 2024, except that these limitations do not apply if there’s an event of default and the conversion price is set at $6.00. Subject to the Investor’s right to convert, the Company may prepay the note at any time that the Company’s common stock trades below $6.00 or the tenth trading day after the registration statement registering the resale of the note’s underlying shares becomes effective. The Investor has contractually agreed not to short the stock during the term of the note.