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UNITED
STATES
SECURITIES
AND EXCHANGE COMMISSION
Washington,
DC 20549
FORM
8-K
CURRENT
REPORT
Pursuant
to Section 13 or 15(d) of the Securities Exchange Act of 1934
November
20, 2025
(Date
of earliest event reported)
APPLIED
DIGITAL CORPORATION
(Exact
name of registrant as specified in its charter)
| Nevada |
|
001-31968 |
|
95-4863690 |
(State
or other jurisdiction
of
incorporation) |
|
(Commission
File
Number) |
|
(IRS
Employer
Identification
No.) |
| 3811
Turtle Creek Boulevard, Suite 2100, Dallas, Texas |
|
75219 |
| (Address of principal executive
offices) |
|
(Zip Code) |
214-427-1704
(Registrant’s
telephone number, including area code)
N/A
(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 (see General Instruction A.2. below):
| ☐ |
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)) |
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. ☐
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 |
|
APLD |
|
Nasdaq Global Select Market |
Item
1.01. Entry into a Material Definitive Agreement.
Senior
Secured Notes Offering
General
On
November 20, 2025, APLD ComputeCo LLC (“Issuer”), a subsidiary of Applied Digital Corporation (the “Company”
or “Applied Digital”), completed its previously announced private offering of 9.250% Senior Secured Notes due 2030
(the “notes”). The notes were sold under a purchase agreement, dated as of November 13, 2025 and as amended thereafter,
entered into by and among the Issuer, the subsidiary guarantors party thereto (the “Subsidiary Guarantors”) and Morgan
Stanley & Co. LLC as the representative (the “Representative”) of the several initial purchasers named in Schedule I
thereto (the “Initial Purchasers”), for resale to persons reasonably believed to be qualified institutional buyers in reliance
on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”), and outside the United States to non-U.S.
persons in reliance on Regulation S under the Securities Act. The aggregate principal amount of notes sold in the offering was $2.35
billion.
The notes were issued at a price equal to 97.000% of their principal amount. The Issuer intends to use the net proceeds from
the offering to fund a portion of the construction and associated expenses of its 100 megawatt (“MW”) and 150 MW data centers,
ELN-02 and ELN-03, respectively (the “Facilities”), at Applied Digital’s 400 MW Ellendale, North Dakota data
center campus, repay the aggregate principal balance plus any accrued and unpaid interest under the Credit and Guaranty Agreement, dated
as of February 11, 2025, by and among APLD HPC Holdings LLC (a subsidiary of Applied Digital), the subsidiary guarantors thereunder,
the lenders party thereto and Sumitomo Mitsui Banking Corporation, as administrative agent and as collateral agent, fund debt
service reserves, and pay transaction expenses.
Indenture
On
November 20, 2025, the Issuer, APLD HPC Holdings 2 LLC (the direct parent of the Issuer) and the Subsidiary Guarantors entered
into an indenture (the “Indenture”) with respect to the notes with Wilmington Trust, National Association, as trustee (the
“Trustee”) and collateral agent (the “Collateral Agent”). The notes are senior secured obligations
of the Issuer and bear interest at a rate of 9.250% per annum, payable semi-annually in arrears on June 15 and December 15 of each year,
beginning on June 15, 2026. The notes will mature on December 15, 2030, unless earlier redeemed or repurchased in accordance with their
terms. The principal amount of the notes will amortize on a semi-annual basis on June 15 and December 15 of each year, beginning on December
15, 2027, in amounts set forth in the Indenture. Required amortization shall be subject to adjustment in case of partial redemption or
repurchase or, in certain circumstances, the issuance of additional notes.
Redemption
On
or after December 15, 2027, the Issuer may redeem the notes at its option, in whole at any time or in part from time to time, at the
redemption prices set forth in the Indenture. Prior to December 15, 2027, the Issuer may redeem the notes at its option, in whole at
any time or in part from time to time, at a redemption price equal to 100% of the principal amount of the notes redeemed, plus
a “make-whole” premium and accrued and unpaid interest, if any. In addition, prior to December 15, 2027, the Issuer
may redeem up to 40% of the aggregate principal amount of the notes in an amount not to exceed the amount of the proceeds of certain
equity offerings, at the redemption price set forth in the Indenture, plus accrued and unpaid interest.
Certain Covenants
The
Indenture limits the ability of the Issuer and the Subsidiary Guarantors to, among other things: (i) incur or guarantee additional indebtedness;
(ii) pay dividends or distributions on, or redeem or repurchase, capital stock and make other restricted payments; (iii) make certain
investments; (iv) create or incur liens; (v) consummate certain asset sales; (vi) enter into sale and lease back transactions; (vii)
hold assets or conduct operations unrelated to the operation of the Facilities and certain additional projects; (viii) engage
in certain transactions with its affiliates; and (ix) merge, consolidate or transfer or sell all or substantially all of its assets.
These covenants are subject to a number of important qualifications and exceptions as set forth in the Indenture. Additionally, upon
the occurrence of specified change of control events, the Issuer must offer to repurchase the notes at 101% of the principal amount,
plus accrued and unpaid interest, if any, to, but excluding, the purchase date. The Indenture also provides for customary events of default.
The
foregoing description of the Indenture and the notes does not purport to be complete and is qualified in its entirety by reference to
the full text of the Indenture (and the form of note included therein), a copy of which is filed with this Current Report on Form 8-K
as Exhibit 4.1 and 4.2 hereto and is hereby incorporated herein by reference.
Completion
Guarantee
The
Company will provide a customary completion guarantee with respect to each Project (as defined in the Indenture) related to the Facilities,
which will require the Company to provide the Issuer funds as necessary to ensure the achievement of the applicable Commencement Date
(as defined in the Indenture) under the respective datacenter lease in the event that the proceeds of the notes and the available
funds (including previous equity contributions from the Company) are insufficient to do so.
Item
2.03. Creation of a Direct Financial Obligation or an Obligation under an Off-Balance Sheet Arrangement of a Registrant.
The
information set forth in Item 1.01 of this Current Report on Form 8-K is incorporated herein by reference.
Forward
Looking Statements
Statements
in this Current Report on Form 8-K about future expectations, plans, and prospects, as well as any other statements regarding matters
that are not historical facts, may constitute “forward-looking statements” within the meaning of The Private Securities Litigation
Reform Act of 1995. These statements include, but are not limited to, the anticipated use of any proceeds from the offering, and the
terms of the notes. The words “anticipate,” “believe,” “continue,” “could,” “estimate,”
“expect,” “intend,” “may,” “plan,” “potential,” “predict,” “project,”
“should,” “target,” “will,” “would,” and similar expressions are intended to identify
forward-looking statements, although not all forward-looking statements contain these identifying words. Actual results may differ materially
from those indicated by such forward-looking statements as a result of various important factors, including uncertainties related to
market conditions and the completion of the offering on the anticipated terms or at all, the other factors discussed in the “Risk
Factors” section of the Company’s Annual Report on Form 10-K filed with the Securities and Exchange Commission (the “SEC”)
on July 30, 2025 and the risks described in other filings that the Company may make from time to time with the SEC. Any forward-looking
statements contained in this Current Report on Form 8-K speak only as of the date hereof, and the Company specifically disclaims any
obligation to update any forward-looking statement, whether as a result of new information, future events, or otherwise, except to the
extent required by applicable law.
Item
9.01. Financial Statements and Exhibits.
(d)
Exhibits.
| Exhibit No. |
|
Description |
| 4.1 |
|
Indenture, dated as of November 20, 2025, among APLD ComputeCo LLC, APLD HPC Holdings 2 LLC, the Subsidiary Guarantors as defined therein and Wilmington Trust, National Association, as trustee and collateral agent, relating to the 9.250% senior secured notes. |
| 4.2 |
|
Form of Note representing the 9.250% Senior Secured Notes due 2030 (included as Exhibit A to Exhibit 4.1). |
| 104 |
|
Cover Page Interactive Data File (embedded within the
Inline XBRL document). |
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.
| Date: November 20, 2025 |
APPLIED DIGITAL CORPORATION |
| |
|
|
| |
By: |
/s/
Saidal Mohmand |
| |
Name: |
Saidal Mohmand |
| |
Title: |
Chief Financial Officer |
