Monitor construction milestones and the final commencement date of the ELN-04 datacenter lease, as the amortization schedule and cash waterfall depend on it. The completion guarantee from the parent provides a backstop against construction delays. The large debt issuance funds a transformative AI infrastructure project with a pre-leased tenant (CoreWeave), reducing execution risk.
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Executive Summary
Applied Digital's subsidiary completed a $1.59 billion private offering of 7.000% Senior Secured Notes due 2031 to fund construction of a 150MW AI data center (ELN-04), repay a $300 million bridge facility, and fund debt service reserves. The parent company provides a completion guarantee, and the notes are secured by substantially all assets of the issuer and its subsidiaries.
Key Facts
- $1.59 billion aggregate principal of 7.000% Senior Secured Notes due 2031 issued at 100% of par
- Net proceeds to fund 150MW ELN-04 AI data center construction, repay $300M bridge facility, and fund $81M debt service reserve
- Notes are senior secured with collateral including capital stock, all property, and project accounts
- Parent Applied Digital provides a completion guarantee for the construction period
- Interest payable semi-annually starting December 15, 2026; maturity June 15, 2031 with semi-annual amortization
Financial Impact
$1.59 billion in new senior secured debt at 7.000% interest, with proceeds allocated to construction capex, bridge loan repayment, and reserves
Risk Factors
- Construction delays or cost overruns on the 150MW data center
- Tenant (CoreWeave) default or lease termination triggering mandatory redemption and potential liquidity strain
- Increased leverage and fixed interest obligations at the subsidiary level
- Potential dilution if equity is needed to cover cost overruns beyond the completion guarantee
Market Snapshot
Investment Themes
Documents Analyzed
This report is based on 5 SEC documents filed with EDGAR.
| Document | Accession Number |
|---|---|
| 8-K Filing (Primary) | 0001493152-26-028899 |
| Document: form8-k.htm | 0001493152-26-028899 |
| Document: 0001493152-26-028899-index-headers.html | 0001493152-26-028899 |
| Document: 0001493152-26-028899-index.html | 0001493152-26-028899 |
| Document: 0001493152-26-028899.txt | 0001493152-26-028899 |
Filters
| Type | Now | ||||
|---|---|---|---|---|---|
Jul 27, 2026 9w ago | 8-K | $26.62 $28.85 | ▲ +8.38% | ▲ +5.00% | $25.38 (−4.66%) |
Jun 26, 2026 14w ago | 8-K | $37.77 $27.19 | ▼ −28.01% | ▼ −27.73% | $25.38 (−32.80%) |
Jun 16, 2026 15w ago | 8-K | $45.57 $26.44 | ▼ −41.98% | ▼ −43.30% | $25.38 (−44.31%) |
Jun 12, 2026 16w ago | Institutional Cluster | $42.70 $31.15 | ▼ −27.05% | ▼ −28.83% | $25.38 (−40.56%) |
Jun 11, 2026 16w ago | Institutional Cluster | $41.47 $32.29 | ▼ −22.14% | ▼ −24.03% | $25.38 (−38.80%) |
Jun 9, 2026 16w ago | 8-K | $41.91 $30.71 | ▼ −26.72% | ▼ −28.17% | $25.38 (−39.44%) |
May 5, 2026 21w ago | 8-K | $44.24 $44.71 | ▲ +1.06% | ▼ −1.72% | $25.38 (−42.63%) |
Apr 27, 2026 22w ago | Insider Cluster | $33.67 $45.14 | ▲ +34.07% | ▲ +29.11% | $25.38 (−24.62%) |
Apr 23, 2026 23w ago | 8-K | $36.35 $39.52 | ▲ +8.72% | ▲ +4.09% | $25.38 (−30.18%) |
Apr 23, 2026 23w ago | Press Release | $36.35 $39.52 | ▲ +8.72% | ▲ +4.09% | $25.38 (−30.18%) |
US Market Status
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