Applied Digital prices $1.59 billion notes for data center expansion

Applied Digital Corporation (NASDAQ: APLD) announced that its subsidiary APLD ComputeCo 3 LLC priced a $1.59 billion offering of 7.000% senior secured notes due 2031 at par. The notes will be sold to qualified institutional buyers in a private offering expected to close around June 16, 2026.

The company plans to use proceeds to fund construction of 150 megawatts of critical IT load at the fourth building at its Polaris Forge 1 AI data center campus in Ellendale, North Dakota. Additional funds will repay a bridge loan facility with Goldman Sachs Bank USA, establish debt service reserves, and cover transaction expenses.

The notes will be guaranteed by APLD ComputeCo 3's subsidiaries, including APLD ELN-04 HoldCo LLC, APLD ELN-04 LLC and APLD ELN-04 LandCo LLC. The securities will be secured by first-priority liens on substantially all assets of APLD ComputeCo 3 and the guarantors, plus equity interests held by parent company APLD HPC Holdings 2 LLC.

Applied Digital will provide a completion guarantee for the ELN-04 project, committing to fund APLD ComputeCo 3 as necessary to ensure timely project completion. The offering remains subject to market and other conditions.

The notes have not been registered under the Securities Act and will only be offered to qualified institutional buyers under Rule 144A and non-U.S. persons under Regulation S. Applied Digital operates data centers and colocation services for artificial intelligence, networking, and blockchain workloads.

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