TeraWulf Inc. Announces Upsize and Pricing of $425 Million Convertible Notes Offering
TeraWulf announced the pricing of $425 million in 2.75% Convertible Senior Notes due 2030. The notes will be sold to qualified institutional buyers with an initial conversion price of $8.48 per share, representing a 32.50% premium to the closing price. The company will use approximately $51 million for capped call transactions, $115 million to repurchase shares, and the remainder for general corporate purposes. The notes include a conversion rate of 117.9245 shares per $1,000 principal amount and feature capped call transactions with an initial cap price of $12.80 per share. TeraWulf will repurchase approximately 17.97 million shares at $6.40 per share.
TeraWulf ha annunciato il pricing di 425 milioni di dollari in Note Senior Convertibili al 2,75% con scadenza nel 2030. Le note saranno vendute a investitori istituzionali qualificati con un prezzo di conversione iniziale di 8,48 dollari per azione, che rappresenta un premio del 32,50% rispetto al prezzo di chiusura. L'azienda utilizzerà circa 51 milioni di dollari per transazioni di capped call, 115 milioni di dollari per riacquistare azioni e il resto per scopi aziendali generali. Le note includono un tasso di conversione di 117,9245 azioni per ogni 1.000 dollari di importo principale e presentano transazioni di capped call con un prezzo di cap iniziale di 12,80 dollari per azione. TeraWulf riacquisterà circa 17,97 milioni di azioni a 6,40 dollari per azione.
TeraWulf anunció el precio de 425 millones de dólares en Notas Senior Convertibles al 2.75% con vencimiento en 2030. Las notas se venderán a compradores institucionales calificados con un precio de conversión inicial de 8.48 dólares por acción, lo que representa una prima del 32.50% sobre el precio de cierre. La empresa utilizará aproximadamente 51 millones de dólares para transacciones de capped call, 115 millones de dólares para recomprar acciones y el resto para fines corporativos generales. Las notas incluyen una tasa de conversión de 117.9245 acciones por cada 1,000 dólares de monto principal y cuentan con transacciones de capped call con un precio de cap inicial de 12.80 dólares por acción. TeraWulf recomprará aproximadamente 17.97 millones de acciones a 6.40 dólares por acción.
TeraWulf는 4억 2500만 달러의 2.75% 전환형 선순위 채권 2030년 만기에 대한 가격을 발표했습니다. 채권은 자격을 갖춘 기관 투자자에게 판매되며, 초기 전환 가격은 주당 8.48달러로, 종가에 대해 32.50% 프리미엄을 나타냅니다. 회사는 약 5천100만 달러를 capped call 거래에, 1억 1천500만 달러를 자사주 매입에, 나머지는 일반 기업 용도로 사용할 예정입니다. 이 채권은 1,000달러의 원금에 대해 117.9245주로 전환할 수 있는 비율을 포함하고 있으며, 주당 12.80달러의 초기 캡 가격을 가진 capped call 거래가 특징입니다. TeraWulf는 주당 6.40달러에 약 1,797만 주를 재매입할 것입니다.
TeraWulf a annoncé le prix de 425 millions de dollars en Obligations Senior Convertibles à 2,75% arrivant à échéance en 2030. Les obligations seront vendues à des acheteurs institutionnels qualifiés avec un prix de conversion initial de 8,48 dollars par action, représentant une prime de 32,50% par rapport au prix de clôture. La société utilisera environ 51 millions de dollars pour des transactions de capped call, 115 millions de dollars pour racheter des actions et le reste pour des fins corporatives générales. Les obligations incluent un taux de conversion de 117,9245 actions par tranche de 1 000 dollars de montant principal et présentent des transactions de capped call avec un prix de cap initial de 12,80 dollars par action. TeraWulf va racheter environ 17,97 millions d'actions à 6,40 dollars par action.
TeraWulf hat die Preisgestaltung für 425 Millionen Dollar in 2,75% wandelbaren senior Notes mit Fälligkeit 2030 bekannt gegeben. Die Notes werden an qualifizierte institutionelle Käufer verkauft, mit einem anfänglichen Umwandlungspreis von 8,48 Dollar pro Aktie, was einen Aufschlag von 32,50% auf den Schlusskurs darstellt. Das Unternehmen wird etwa 51 Millionen Dollar für capped-call-Transaktionen, 115 Millionen Dollar zum Rückkauf von Aktien und den Rest für allgemeine Unternehmenszwecke verwenden. Die Notes beinhalten einen Umwandlungsfaktor von 117,9245 Aktien pro 1.000 Dollar Nennbetrag und bieten capped-call-Transaktionen mit einem anfänglichen Höchstpreis von 12,80 Dollar pro Aktie. TeraWulf wird etwa 17,97 Millionen Aktien zu einem Preis von 6,40 Dollar pro Aktie zurückkaufen.
- Secured $425 million in convertible note financing
- Strategic capped call transactions to reduce potential share dilution
- Repurchasing $115 million worth of common stock
- Additional debt obligation with 2.75% interest rate
- Potential future dilution if notes are converted to shares
- Significant cash outlay for share repurchases and capped call transactions
Insights
This
The strategic use of proceeds, including
The transaction's structure reveals strong institutional investor confidence in TeraWulf's business model. The successful upsize of the offering from initial expectations indicates robust demand. The
The timing of this offering is strategic, capitalizing on market conditions to secure long-term financing while maintaining operational flexibility. The combination of convertible notes and share repurchases creates a balanced approach to capital management.
EASTON, Md., Oct. 24, 2024 (GLOBE NEWSWIRE) -- TeraWulf Inc. (Nasdaq: WULF) (“TeraWulf” or the “Company”), a leading owner and operator of vertically integrated, next-generation digital infrastructure powered by predominantly zero-carbon energy, today announced the upsize and pricing of its offering of
Key Elements of the Transaction:
$425 million 2.75% Convertible Senior Notes offering (32.50% conversion premium)- Capped call transactions entered into in connection with the
2.75% Convertible Senior Notes due 2030 with an initial cap price of$12.80 per share of common stock, which represents a100% premium to the closing sale price of TeraWulf’s common stock on October 23, 2024 - Concurrent repurchase of approximately
$115 million of common stock
TeraWulf has granted the initial purchasers of the Convertible Notes a 13-day option to purchase up to an additional
Use of Proceeds:
The Company anticipates that the aggregate net proceeds from the offering will be approximately
Additional Details of the Convertible Notes:
The Convertible Notes will be senior unsecured obligations of the Company and will accrue interest at a rate of
The Convertible Notes will be convertible into cash in respect of the aggregate principal amount of the Convertible Notes to be converted and cash, shares of the common stock or a combination of cash and shares of the common stock, at the Company’s election, in respect of the remainder, if any, of the Company’s conversion obligation in excess of the aggregate principal amount of the Convertible Notes being converted. The conversion rate will initially be 117.9245 shares of common stock per
The Company may not redeem the Convertible Notes prior to November 6, 2027. The Company may redeem for cash all or any portion of the Convertible Notes, at its option, on or after November 6, 2027, if the last reported sale price of the common stock has been at least
Holders of the Convertible Notes will have the right to require the Company to repurchase all or a portion of their Convertible Notes upon the occurrence of a fundamental change (as defined in the indenture governing the Convertible Notes) at a cash repurchase price of
Capped Call Transactions:
In connection with the pricing of the Convertible Notes, the Company entered into privately negotiated capped call transactions with certain financial institutions (the “option counterparties”). The cap price of the capped call transactions will initially be
The capped call transactions are expected generally to reduce potential dilution to the common stock upon conversion of any Convertible Notes and/or offset any cash payments the Company is required to make in excess of the principal amount of converted Convertible Notes, as the case may be, with such reduction and/or offset subject to a cap.
In connection with establishing their initial hedges of the capped call transactions, the Company expects the option counterparties or their respective affiliates to purchase shares of the common stock and/or enter into various derivative transactions with respect to the common stock concurrently with or shortly after the pricing of the Convertible Notes. This activity could increase (or reduce the size of any decrease in) the market price of the common stock or the Convertible Notes at that time. In addition, the option counterparties or their respective affiliates may modify their hedge positions by entering into or unwinding various derivatives with respect to the common stock and/or purchasing or selling shares of the common stock or other securities of the Company in secondary market transactions following the pricing of the Convertible Notes and prior to the maturity of the Convertible Notes (and are likely to do so on each exercise date for the capped call transactions or following any termination of any portion of the capped call transactions in connection with any repurchase, redemption or early conversion of the Convertible Notes). This activity could also cause or avoid an increase or decrease in the market price of the common stock or the Convertible Notes, which could affect holders of the Convertible Notes’ ability to convert the Convertible Notes and, to the extent the activity occurs following conversion of the Convertible Notes or during any observation period related to a conversion of the Convertible Notes, it could affect the amount and value of the consideration that holders of the Convertible Notes will receive upon conversion of such Convertible Notes.
Share Repurchases:
The Company entered into transactions to repurchase approximately 17.97 million shares of the common stock for an aggregate purchase price of approximately
The Convertible Notes and any shares of common stock issuable upon conversion of the Convertible Notes, if any, have not been registered under the Securities Act, securities laws of any other jurisdiction, and the Convertibles Notes and such shares of common stock may not be offered or sold in the United States absent registration or an applicable exemption from registration under the Securities Act and any applicable state securities laws. The Convertible Notes will be offered only to persons reasonably believed to be qualified institutional buyers under Rule 144A under the Securities Act.
This press release shall not constitute an offer to sell, or a solicitation of an offer to buy the Convertible Notes, nor shall there be any sale of the Convertible Notes or common stock in any state or jurisdiction in which such an offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
About TeraWulf
TeraWulf develops, owns, and operates environmentally sustainable, next-generation data center infrastructure in the United States, specifically designed for Bitcoin mining and high-performance computing. Led by a team of seasoned energy entrepreneurs, the Company owns and operates the Lake Mariner facility situated on the expansive site of a now retired coal plant in Western New York. Currently, TeraWulf generates revenue primarily through Bitcoin mining, leveraging predominantly zero-carbon energy sources, including nuclear and hydroelectric power. Committed to environmental, social, and governance (ESG) principles that align with its business objectives, TeraWulf aims to deliver industry-leading economics in mining and data center operations at an industrial scale.
Forward-Looking Statements
This press release contains forward-looking statements within the meaning of the “safe harbor” provisions of the Private Securities Litigation Reform Act of 1995, as amended. Such forward-looking statements include statements concerning anticipated future events and expectations that are not historical facts, such as statements concerning the terms of the notes and the capped call transactions, the completion, timing and size of the offering of the notes and the capped call transactions, and the anticipated use of proceeds from the offering (including the proposed share repurchases). All statements, other than statements of historical fact, are statements that could be deemed forward-looking statements. In addition, forward-looking statements are typically identified by words such as “plan,” “believe,” “goal,” “target,” “aim,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project,” “continue,” “could,” “may,” “might,” “possible,” “potential,” “predict,” “should,” “would” and other similar words and expressions, although the absence of these words or expressions does not mean that a statement is not forward-looking. Forward-looking statements are based on the current expectations and beliefs of TeraWulf’s management and are inherently subject to a number of factors, risks, uncertainties and assumptions and their potential effects. There can be no assurance that future developments will be those that have been anticipated. Actual results may vary materially from those expressed or implied by forward-looking statements based on a number of factors, risks, uncertainties and assumptions, including, among others: (1) conditions in the cryptocurrency mining industry, including fluctuation in the market pricing of bitcoin and other cryptocurrencies, and the economics of cryptocurrency mining, including as to variables or factors affecting the cost, efficiency and profitability of cryptocurrency mining; (2) competition among the various providers of cryptocurrency mining services; (3) changes in applicable laws, regulations and/or permits affecting TeraWulf’s operations or the industries in which it operates, including regulation regarding power generation, cryptocurrency usage and/or cryptocurrency mining, and/or regulation regarding safety, health, environmental and other matters, which could require significant expenditures; (4) the ability to implement certain business objectives and to timely and cost-effectively execute integrated projects; (5) failure to obtain adequate financing on a timely basis and/or on acceptable terms with regard to growth strategies or operations; (6) loss of public confidence in bitcoin or other cryptocurrencies and the potential for cryptocurrency market manipulation; (7) adverse geopolitical or economic conditions, including a high inflationary environment; (8) the potential of cybercrime, money-laundering, malware infections and phishing and/or loss and interference as a result of equipment malfunction or break-down, physical disaster, data security breach, computer malfunction or sabotage (and the costs associated with any of the foregoing); (9) the availability, delivery schedule and cost of equipment necessary to maintain and grow the business and operations of TeraWulf, including mining equipment and infrastructure equipment meeting the technical or other specifications required to achieve its growth strategy; (10) employment workforce factors, including the loss of key employees; (11) litigation relating to TeraWulf and/or its business; and (12) other risks and uncertainties detailed from time to time in the Company’s filings with the Securities and Exchange Commission (“SEC”). Potential investors, stockholders and other readers are cautioned not to place undue reliance on these forward-looking statements, which speak only as of the date on which they were made. TeraWulf does not assume any obligation to publicly update any forward-looking statement after it was made, whether as a result of new information, future events or otherwise, except as required by law or regulation. Investors are referred to the full discussion of risks and uncertainties associated with forward-looking statements and the discussion of risk factors contained in the Company’s filings with the SEC, which are available at www.sec.gov.
Investors:
Investors@terawulf.com
Media:
media@terawulf.com
FAQ
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