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Get filing alertsFermi closes $431M convertible notes offering to fund Project Matador AI campus development
Filed July 15, 2026 · Period ending July 9, 2026 · ~2 min read
Key Changes
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Fermi issued $431.25M of 5.00% convertible senior notes due 2031 (including $56.25M overallotment exercised in full), receiving net proceeds of ~$416.81M after fees. Notes convert at $9.52/share (30% premium to July 9 close).
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR → -
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Company entered capped call transactions (~$34.5M of proceeds) to reduce dilution, with effective conversion price of $14.64/share (100% premium). Maximum conversion shares: 58.9M at initial rate of 136.6120 shares per $1,000 principal.
Item 7.01 — Regulation FD Disclosure verify on EDGAR → -
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Project Matador has 7,570 acres secured in Texas Panhandle with >$1.4B invested to date. Expected to ramp to ~1.5 gigawatts through 2027, subject to binding tenant agreements. Nearly $1B of commitments already secured.
Exhibit 99.1 view on EDGAR → -
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Notes are unsecured, rank equal with other unsecured debt, but effectively subordinated to secured debt and structurally subordinated to all subsidiary liabilities. Fermi may redeem starting July 2029 if stock reaches 130% of conversion price.
Item 1.01 — Entry into a Material Definitive Agreement verify on EDGAR → -
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Remainder of proceeds (~$382M) allocated to general corporate purposes. Management stated proceeds strengthen liquidity during customer/partner negotiations and support Project Matador development milestones.
Exhibit 99.1 view on EDGAR →
Summary
Fermi completed a $431.25 million convertible senior notes offering to fund development of Project Matador, its large-scale AI and energy campus in the Texas Panhandle. The notes carry a 5.00% coupon, mature in 2031, and convert at $9.52 per share—a 30% premium to the July 9 closing price.
The company allocated $34.5 million of net proceeds to capped call transactions that cap dilution at $14.64 per share (100% premium), meaning existing shareholders face no dilution unless the stock doubles. Maximum conversion would add 58.9 million shares. The capital raise addresses Fermi's near-term funding needs as it negotiates binding tenant agreements and advances strategic partnerships for Project Matador.
The company has invested over $1.4 billion in the 7,570-acre site and expects to ramp to approximately 1.5 gigawatts through 2027, contingent on securing tenant commitments. Management disclosed nearly $1 billion of commitments already in hand. The convertible structure allows Fermi to negotiate from a position of liquidity strength without being paced by cash constraints, while the capped calls limit equity dilution if the project execution drives meaningful stock appreciation. The notes are unsecured and structurally subordinated to subsidiary debt, standard for this capital structure but worth noting given the project's capital intensity and reliance on future tenant agreements.
Section-by-Section Diff
Event · Item 2.03 — Creation of a Direct Financial Obligation
Item 2.03 also reports this as a direct financial obligation (body incorporates the primary Item by reference).
Added in current filing · verify on EDGAR →
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.
The company also filed this under Item 2.03, which means it is reporting the arrangement as a direct financial obligation. The Item 2.03 text refers back to the Item 1.01 entry for the terms rather than restating them.
Event · Item 1.01 — Entry into a Material Definitive Agreement
Item 1.01 — Entry into a Material Definitive Agreement filed; see Key Changes for terms.
Added in current filing · verify on EDGAR →
The conversion rate for the Notes will initially be 105.0862 shares of Common Stock per $1,000 principal amount of Notes (equivalent to an initial conversion price of approximately $9.52 per share of Common Stock). The conversion rate and the corresponding conversion price will be subject to adjustment in some events but will not be adjusted for any accrued and unpaid interest.
The notes are convertible at an initial rate of 105.0862 shares per $1,000 principal, equivalent to a conversion price of approximately $9.52 per share. Conversion is restricted until April 15, 2031 unless certain conditions are met, after which holders may convert at any time until two trading days before maturity. The company may settle conversions in cash, stock, or a combination.
Added in current filing · verify on EDGAR →
The Company may redeem for cash all or part of the Notes (subject to the partial redemption limitation described in the Indenture), at its option, on or after July 20, 2029 and prior to the 31st scheduled trading day immediately prior to the Maturity Date, if the last reported sale price of the Common Stock has been at least 130% of the conversion price then in effect for at least 20 trading days (whether or not consecutive) during any 30 consecutive trading day period (including the last trading day of such period) ending on, and including, the trading day immediately preceding the date on which the Company provides notice of redemption at a redemption price equal to 100% of the principal amount of the Notes to be redeemed, plus accrued and unpaid interest to, but excluding, the redemption date.
Fermi may redeem the notes starting July 20, 2029 if its stock price reaches at least 130% of the conversion price for 20 out of 30 consecutive trading days, at par plus accrued interest. Holders may require the company to repurchase their notes at par plus accrued interest upon a fundamental change event.
Added in current filing · verify on EDGAR →
The Notes will be the Company’s general unsecured obligations and will rank senior in right of payment to all of the Company’s future indebtedness that is expressly subordinated in right of payment to the Notes, equal in right of payment with all of the Company’s current and future liabilities that are not so subordinated, and effectively junior to all of the Company’s current and future secured indebtedness to the extent of the value of the assets securing such indebtedness. The Notes will rank structurally junior to all indebtedness and other liabilities (including trade payables but excluding intercompany obligations and liabilities of a type not required to be reflected on a balance sheet of such subsidiaries in accordance with GAAP) of the Company’s subsidiaries.
The notes are unsecured and rank equal with other unsecured debt, but are effectively subordinated to any secured debt to the extent of collateral value and structurally subordinated to all subsidiary liabilities. This means creditors of subsidiaries and secured lenders would have priority claims in a bankruptcy or liquidation scenario.
Event · Item 3.02 — Unregistered Sales of Equity Securities
8-K references unregistered equity sales disclosed in Item 1.01, but Item 1.01 content is not provided in this filing excerpt.
Added in current filing · verify on EDGAR →
Item 3.02. Unregistered Sales of Equity Securities.
The information set forth in Item 1.01 and
The filing discloses unregistered sales of equity securities under Item 3.02, cross-referencing Item 1.01 for details. The provided excerpt is incomplete and does not contain the substantive disclosure from Item 1.01, so the nature, size, and terms of the equity issuance cannot be determined from this text.
Event · Item 7.01 — Regulation FD Disclosure
Fermi closed a private offering of convertible notes to qualified institutional buyers under Rule 144A.
Added in current filing · verify on EDGAR →
The Company offered and sold the Notes to the Initial Purchasers in reliance on the exemption from the registration requirements provided by Section 4(a) (2) of the Securities Act for resale to persons reasonably believed to be qualified institutional buyers as defined in, and in reliance on, Rule 144A of the Securities Act.
Fermi completed a private placement of convertible notes to institutional buyers through initial purchasers. The notes were sold under exemptions from SEC registration requirements, specifically Section 4(a)(2) and Rule 144A, which allow sales to qualified institutional buyers without a public registration statement.
Added in current filing · verify on EDGAR →
To the extent that any shares of the Common Stock are issued upon conversion of the Notes, they will be issued in transactions anticipated to be exempt from registration under the Securities Act by virtue of Section 3(a) (9) thereof, because no commission or other remuneration is expected to be paid in connection with conversion of the Notes and any resulting issuance of shares of the Common Stock.
Any common stock issued when noteholders convert will be exempt from SEC registration under Section 3(a)(9) because no commissions or fees will be paid in connection with the conversion. This is a standard structure for convertible note offerings that allows the company to issue conversion shares without additional registration costs or delays.
Event · Exhibit 99.1
Fermi closed $431.25M convertible notes offering with capped call to fund Project Matador development and tenant negotiations.
Added in current filing · view on EDGAR →
The initial conversion price is approximately $9.52 per share, representing a 30% premium to the July 9, 2026 closing price of Fermi’s common stock. In connection with the offering, Fermi entered into capped call transactions that are expected to reduce potential dilution upon conversion, with an effective conversion price of $14.64 per share, representing a 100% premium to the July 9, 2026 closing price.
The convertible notes have an initial conversion price of $9.52 per share (30% premium to July 9 closing price). Fermi entered into capped call transactions with an effective conversion price of $14.64 per share (100% premium), designed to minimize shareholder dilution unless the stock price doubles. The company will use approximately $34.5 million of proceeds to fund these capped call transactions.
Added in current filing · view on EDGAR →
The Company will use approximately $34.5 million to fund the capped call transactions, with the remainder for general corporate purposes.
Of the $416.81 million net proceeds, approximately $34.5 million will fund the capped call transactions, with the remainder allocated to general corporate purposes. Management stated the proceeds are intended to strengthen liquidity during customer and partner negotiations and support Project Matador development milestones.
Added in current filing · view on EDGAR →
Strengthening the balance sheet is a key enabler of Fermi’s near-term business objectives:
● Signing binding tenant agreements; | ● Advancing strategic partnerships; and | ● Delivering initial power at the site.
Management outlined three near-term business objectives enabled by the strengthened balance sheet: signing binding tenant agreements, advancing strategic partnerships, and delivering initial power at the site. The CFO stated the convertible structure allows the company to continue tenant and strategic partnership negotiations from a position of strength without being paced by its cash position.
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Figures/quotes linked to EDGAR · Narrative written by AI · Jul 15, 2026 · How we verify