Applied Digital (APLD) Secures $150M Preferred Equity Deal: What's Going On?

Applied Digital Corp APLD shares are trading higher by 12.1% to $5.08 during Thursday’s session as the stock trends across social media platforms.

On Wednesday, the company announced it had entered into a preferred equity purchase agreement with select investors, allowing the company to raise up to $150 million through the sale of its newly designated Series G Convertible Preferred Stock.

What To Know: The shares, priced at $1,000 each with a 4% original issue discount, may be issued in tranches of at least $25 million, subject to a staged increase in limits based on regulatory approvals.

Northland Securities acted as placement agent, earning a 3% transaction fee. Conversion into common stock will begin 45 days after issuance or once SEC registration becomes effective, with a monthly conversion cap of $30 million.

The Series G shares meanwhile carry a floor conversion price of $4.25, adjustable down to $1.34, and include safeguards like redemption clauses tied to trading performance and Nasdaq ownership limits.

Simultaneously, Applied Digital terminated its unused standby equity agreement with YA II PN, LTD. The Series G stock ranks senior to common shares and includes redemption rights if conversion limits persist. The offering was conducted under a private placement exemption.

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How To Buy APLD Stock

Besides going to a brokerage platform to purchase a share – or fractional share – of stock, you can also gain access to shares either by buying an exchange traded fund (ETF) that holds the stock itself, or by allocating yourself to a strategy in your 401(k) that would seek to acquire shares in a mutual fund or other instrument.

For example, in Applied Digital’s case, it is in the Information Technology sector. An ETF will likely hold shares in many liquid and large companies that help track that sector, allowing an investor to gain exposure to the trends within that segment.

According to data from Benzinga Pro, APLD has a 52-week high of $12.48 and a 52-week low of $2.92.