Summary by Moomoo AI
Applied Digital announced the pricing of $375 million 2.75% Convertible Senior Notes due 2030, with an option for an additional $75 million. The offering is expected to close on November 4, 2024. Net proceeds are estimated at $361.8 million, or $434.5 million if the option is fully exercised.The company plans to use $84 million for share repurchases, including $52.7 million for a prepaid forward repurchase and $31.3 million for concurrent share buybacks. Additionally, $43.1 million will fund capped call transactions, with the remainder for general corporate purposes. The notes have an initial conversion rate of 102.5431 shares per $1,000 principal, equivalent to $9.75 per share, a 32.5% premium to the October 30 closing price.The capped call transactions, with a cap price of $14.72 per share, aim to reduce potential dilution. The prepaid forward repurchase involves approximately 7.2 million shares initially. These transactions may impact the stock price and effectively raise the notes' conversion price.