Applied Digital Announces Pricing of $2.15 Billion of Senior Secured Notes to fund Polaris Forge 2 Campus

Rhea-AI Summary

Applied Digital (NASDAQ: APLD) priced $2.15 billion of 6.750% senior secured notes due 2031 at an issue price of 98%, with expected closing on or around March 10, 2026.

The net proceeds are earmarked to fund development and construction of 200 megawatts of critical IT load at the Polaris Forge 2 AI Factory campus in Harwood, North Dakota, and to fund Project Accounts and transaction expenses. The notes are fully and unconditionally guaranteed by current and future subsidiaries, secured by first‑priority liens, and carry customary completion guarantees from Applied Digital.

Positive

• $2.15B debt raise to fund Polaris Forge 2 development
• Proceeds targeted for 200 MW critical IT load construction
• Notes secured by first‑priority liens and subsidiary guarantees

Negative

• New 6.750% interest-bearing debt matures in 2031, increasing leverage
• Offering completion is conditional and may not close as expected

Key Figures

Senior secured notes size: $2.15 billion Coupon rate: 6.750% Issue price: 98% +2 more

5 metrics

Senior secured notes size $2.15 billion APLD Compute 2 debt offering to fund Polaris Forge 2

Coupon rate 6.750% Interest rate on senior secured notes due 2031

Issue price 98% Issue price of notes relative to par

Maturity year 2031 Maturity of senior secured notes

Campus IT load 200 megawatts Critical IT load at Polaris Forge 2 AI Factory campus

Market Reality Check

Price: $28.65 Vol: Volume 13,578,132 vs 20-d...

low vol

$28.65 Last Close

Volume Volume 13,578,132 vs 20-day avg 23,295,502 (relative volume 0.58) low

Technical Trading above 200-day MA: price 26.15 vs MA(200) 22.36

Peers on Argus

APLD fell 6.37% while key peers were mostly positive (e.g., SAIC +3.6%, VRRM +1....

APLD fell 6.37% while key peers were mostly positive (e.g., SAIC +3.6%, VRRM +1.94%, GDS +1.33%). With no peers in the momentum scanner, the move appears stock-specific rather than sector-driven.

Historical Context

5 past events · Latest: Mar 02 (Negative)

Pattern 5 events

Date	Event	Sentiment	Move	Catalyst
Mar 02	Debt offering	Negative	-6.4%	Announced intent to offer $2.15B senior secured notes for Polaris Forge 2.
Jan 22	AI campus expansion	Positive	-0.9%	Broke ground on Delta Forge 1, a 430 MW AI Factory campus.
Jan 15	Leadership change	Neutral	-2.4%	Co-founder Jason Zhang appointed President to support AI platform scaling.
Jan 07	Earnings report	Positive	+8.1%	Reported strong Q2 revenue growth, improved losses, and major AI contracts.
Dec 29	Cloud spin-out plan	Positive	-2.9%	Proposed combining cloud business with EKSO to form ChronoScale.

Pattern Detected

Recent strategic and expansion announcements often saw negative price reactions, while the latest earnings report with strong growth aligned with a positive move.

Recent Company History

Over the last few months, Applied Digital has focused on large-scale AI infrastructure and corporate structuring. A prior announcement on Mar 2 about the same $2.15B senior secured notes coincided with a -6.37% move. Earlier, the company broke ground on the Delta Forge 1 AI campus and reported strong fiscal Q2 2026 results with sharply higher revenue and improved losses, which led to an 8.05% gain. The ChronoScale cloud spin-out and leadership changes both drew modest negative reactions.

Regulatory & Risk Context

Active S-3 Shelf

Shelf Active

Active S-3 Shelf Registration 2025-09-26

Applied Digital has an effective S-3ASR shelf filed on 2025-09-26, with at least two 424B3 takedowns in 2025. The shelf covers various securities and related agreements tied to its North Dakota data center assets, providing flexibility for future capital raises.

Market Pulse Summary

This announcement details the pricing of $2.15B in 6.750% senior secured notes, issued at 98% of par...

Analysis

This announcement details the pricing of $2.15B in 6.750% senior secured notes, issued at 98% of par to fund 200 MW of critical IT load at Polaris Forge 2. The financing is secured by first‑priority liens and subsidiary guarantees, with Applied Digital providing completion guarantees. In context of recent large-scale AI campus projects and prior capital raises, investors may track execution milestones, leverage levels, and any further use of its effective shelf registration.

Key Terms

senior secured notes, Rule 144A, Regulation S, indenture, +1 more

5 terms

senior secured notes financial

"has priced a $2.15 billion offering ... of 6.750% senior secured notes due 2031"

Senior secured notes are loans a company sells to investors that are backed by specific assets and given first priority for repayment if the company defaults. Because they have a claim on collateral and are paid before other debts, they usually offer lower risk and correspondingly lower interest than unsecured debt; investors use them to judge how safe repayment and recovery of principal might be, like holding a mortgage instead of an unsecured credit card balance.

Rule 144A regulatory

"qualified institutional buyers in reliance on Rule 144A under the Securities Act"

Rule 144A is a regulation that makes it easier for companies to sell private bonds to large investors without going through all the usual rules that apply to public sales. It matters because it helps companies raise money more quickly and privately, often attracting big investors looking for special deals.

Regulation S regulatory

"outside the United States to non-U.S. persons in reliance on Regulation S under the Securities Act"

Regulation S is a set of rules that allows companies to sell securities (like shares or bonds) to investors outside the United States without having to follow all U.S. securities laws. It matters because it makes it easier for companies to raise money from international investors while still complying with U.S. regulations.

indenture financial

"in accordance with the provisions of the indenture governing the Notes"

An indenture is a legal agreement between a company that borrows money by issuing bonds and the people who buy those bonds. It explains the rules the company must follow, like paying back the money and keeping certain financial promises. This document helps both sides understand their rights and responsibilities.

Debt Service Reserve Account financial

"Project Accounts (including but not limited to the Debt Service Reserve Account)"

A debt service reserve account is a dedicated cash savings account set aside to cover upcoming interest and principal payments on a loan or bond if the borrower’s regular cash flow falls short. Think of it as an emergency piggy bank for debt payments that reduces the chance of missed payments and lowers risk for lenders and investors, though it also ties up cash that could otherwise be used for growth or dividends.

AI-generated analysis. Not financial advice.

DALLAS, March 04, 2026 (GLOBE NEWSWIRE) -- Applied Digital Corporation (NASDAQ: APLD) (“Applied Digital” or the “Company”), a leading designer, builder and operator of high-performance, sustainably engineered data centers and colocation services for Artificial Intelligence (“AI”), networking, and blockchain workloads, today announced that its subsidiary, APLD ComputeCo 2 LLC (“APLD Compute 2”), has priced a $2.15 billion offering (the “Offering”) of 6.750% senior secured notes due 2031 (the “Notes”) at an issue price of 98%. The Notes will be sold in a private offering 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 Offering is expected to close on or around March 10, 2026, subject to market and other conditions.

APLD Compute 2 intends to use the net proceeds from the Offering to fund the development and construction of 200 megawatts of critical IT load at Polaris Forge 2, its AI Factory campus in Harwood, North Dakota, as well as the “Project Accounts” (including but not limited to the Debt Service Reserve Account) in accordance with the provisions of the indenture governing the Notes, and to pay related fees and expenses, including transaction expenses.

The Notes will be fully and unconditionally guaranteed by APLD Compute 2’s future and existing direct and indirect subsidiaries, which as of today include APLD FAR-01 HoldCo LLC, APLD FAR-02 HoldCo LLC, APLD FAR-01 LLC, APLD FAR-02 LLC, APLD FAR-01 LandCo LLC, and APLD FAR-02 LandCo LLC (collectively, the “Guarantors”). The Notes and related guarantees will be secured by first-priority liens on (i) substantially all assets of APLD Compute 2 and the Guarantors, other than certain excluded property, and (ii) all equity interests of APLD Compute 2 held by APLD FAR Holdings LLC, a Delaware limited liability company and the direct parent company of APLD Compute 2.

Applied Digital will provide customary completion guarantees with respect to the Polaris Forge 2 project, under which it will fund APLD Compute 2 as necessary to ensure the timely completion of the Polaris Forge 2 project.

Completion of the Offering is subject to certain conditions, and there can be no assurance as to whether or when the Offering may be completed.

The Notes have not been registered under the Securities Act or securities laws of any other jurisdiction and 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 Notes will be offered only to persons reasonably believed to be qualified institutional buyers under Rule 144A under the Securities Act and outside the United States to non-U.S. persons in reliance on Regulation S under the Securities Act.

This press release shall not constitute an offer to sell, or a solicitation of an offer to buy the Notes, nor shall there be any sale of the Notes 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 Applied Digital

Applied Digital (Nasdaq: APLD) named Best Data Center in the Americas 2025 by Datacloud — designs, builds, and operates high-performance, sustainably engineered data centers and colocation services for artificial intelligence, networking, and blockchain workloads. Headquartered in Dallas, TX, and founded in 2021, the company combines hyperscale expertise, proprietary waterless cooling, and rapid deployment capabilities to deliver secure, scalable compute at industry-leading speed and efficiency, while creating economic opportunities in underserved communities through its award-winning Polaris Forge AI Factory model.

Caution About Forward-Looking Statements

This press release contains “forward-looking statements” as defined in the Private Securities Litigation Reform Act of 1995 regarding, among other things, the terms of the Notes, the completion, timing and size of the Offering, the anticipated use of proceeds from the Offering, future operating and financial performance, product development, market position, business strategy and objectives and future financing plans. These statements use words, and variations of words, such as “will,” “continue,” “build,” “future,” “increase,” “drive,” “believe,” “look,” “ahead,” “confident,” “deliver,” “outlook,” “demonstrates,” “expect,” “project” and “predict.” Other examples of forward-looking statements may include, but are not limited to, (i) statements that reflect perspectives and expectations regarding lease agreements and campus development, (ii) statements about the HPC industry, (iii) statements of Company plans and objectives, including the Company’s evolving business model, or estimates or predictions of actions by suppliers, (iv) statements of future economic performance, and (v) statements of assumptions underlying other statements and statements about the Company or its business. You are cautioned not to rely on these forward-looking statements. These statements are based on current expectations of future events and thus are inherently subject to uncertainty. If underlying assumptions prove inaccurate or known or unknown risks or uncertainties materialize, actual results could vary materially from the Company’s expectations and projections. These risks, uncertainties, and other factors include: the Company’s ability to complete construction of the data centers at its Polaris Forge 1, Polaris Forge 2 and Delta Forge 1 campuses; our ability to close the Offering; changes to AI and HPC infrastructure needs and their impact on future plans; risks associated with the leasing business, including those associated with counterparties; costs related to the HPC operations and strategy; the Company’s ability to timely deliver any services required in connection with completion of installation under the lease agreements; the Company’s ability to raise additional capital to fund ongoing and future data center construction and operations; the Company’s ability to obtain financing of the lease agreements on acceptable financing terms, or at all; the Company’s dependence on principal customers, including its ability to execute and perform its obligations under its leases with key customers, including without limitation, the lease agreements; the Company’s ability to timely and successfully build hosting facilities with the appropriate contractual margins and efficiencies; power or other supply disruptions and equipment failures; the inability to comply with regulations, developments and changes in regulations; cash flow and access to capital; availability of financing to continue to grow the Company’s business; decline in demand for the Company’s products and services; maintenance of third party relationships; and conditions in the debt and equity capital markets. A further list and description of these risks, uncertainties and other factors can be found in the Company’s most recently filed Annual Report on Form 10-K and Quarterly Reports on Form 10-Q, including in the sections captioned “Forward-Looking Statements” and “Risk Factors,” and in the Company’s subsequent filings with the Securities and Exchange Commission. Copies of these filings are available online at www.sec.gov, on the Company’s website (www.applieddigital.com) under “Investors,” or on request from the Company. Information in this release is as of the dates and time periods indicated herein, and the Company and APLD Compute 2 do not undertake to update any of the information contained in these materials, except as required by law.

Media Contact

JSA (Jaymie Scotto & Associates)
(856) 264-7827
jsa_applied@jsa.net

Investor Relations Contacts

Matt Glover or Ralf Esper
Gateway Group, Inc.
(949) 574-3860
APLD@gateway-grp.com

FAQ

What did APLD announce about the $2.15 billion notes offering on March 4, 2026?

Applied Digital priced $2.15 billion of 6.750% senior secured notes due 2031 at 98% issue price. According to the company, the private offering is expected to close on or around March 10, 2026, subject to market and customary conditions.

How will APLD use proceeds from the $2.15B notes offering for Polaris Forge 2?

The company will use net proceeds to fund construction of 200 megawatts of critical IT load at Polaris Forge 2. According to the company, proceeds also fund Project Accounts and pay related fees and transaction expenses.

What security and guarantees back the APLD ComputeCo 2 notes due 2031?

The notes are secured by first‑priority liens on substantially all assets and equity interests and fully guaranteed by subsidiaries. According to the company, both existing and future direct and indirect subsidiaries will guarantee the notes.

When is the APLD notes offering expected to close and who can buy the notes?

The offering is expected to close on or about March 10, 2026, subject to conditions. According to the company, the notes are offered to qualified institutional buyers under Rule 144A and to non‑U.S. persons under Regulation S.

What are the investor implications of APLD offering 6.750% notes maturing in 2031?

Investors should note the company is adding long‑term interest-bearing debt with a 6.750% coupon maturing in 2031. According to the company, the debt is structurally secured and carries completion guarantees for Polaris Forge 2.

Does Applied Digital guarantee completion of the Polaris Forge 2 project related to the offering?

Applied Digital will provide customary completion guarantees and fund APLD Compute 2 as necessary to complete Polaris Forge 2. According to the company, these guarantees are intended to ensure timely project completion under the indenture provisions.