TeraWulf Inc. (WULF), a digital asset technology company, on Monday announced that plans to offer $400 mln of convertible senior notes due 2031 in a private placement to qualified institutional buyers.
The company expects to grant initial purchasers a 13-day option to buy up to an additional $60 mln of the convertible notes.
The company plans to use the net proceeds from the offering to cover the cost of capped call transactions, with the remainder allocated toward data center expansion and general corporate purposes.
The convertible notes will be senior unsecured obligations, bearing interest payable semi-annually on March 1 and September 1, starting March 1, 2026.
The notes will mature on September 1, 2031, unless earlier repurchased, redeemed, or converted. Before June 1, 2031, conversion will be permitted only under certain conditions and periods and thereafter, they will be convertible at any time until two trading days before maturity.
At the time of pricing, the company expects to enter into privately negotiated capped call transactions with one or more initial purchasers and/or other financial institutions.
The capped call transactions aim to limit dilution and manage cash outlays on note conversions, while related hedging activities may affect stock and note prices.
In the pre-market trading, TeraWulf is 6.80% higher at $9.58 on the Nasdaq.
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