FRMI · Fermi Inc. Common Stock

Fermi Inc. disclosed two significant events in its July 9, 2026 Form 8-K. First, the company commenced a private offering of $350 million aggregate principal amount of convertible senior notes due 2031, with an option for initial purchasers to buy an additional $52.5 million. The notes will be issued to qualified institutional buyers under Rule 144A and are expected to be convertible into cash, common stock, or a combination thereof at the company's election. Proceeds will fund capped call transactions to reduce potential dilution upon conversion, with the remainder for general corporate purposes, including liquidity needs for its Project Matador development. This financing strengthens Fermi's balance sheet amid ongoing capital requirements for its large-scale power campus.

Second, Fermi announced it will defer its REIT election, originally intended for the short year ended December 31, 2025, and now expects to elect REIT status for the taxable year ending December 31, 2026. The company was taxed as a C corporation for 2025 and previously disclosed plans to qualify as a REIT. This deferral may affect its tax profile and investor expectations.

The filing also includes excerpts from a preliminary offering memorandum detailing recent developments: preliminary discussions with seven potential tenants and twelve joint venture partners, advanced negotiations for a CEO hire, and ongoing litigation with former CEO Toby Neugebauer. The litigation, which includes claims over employment termination and bylaw amendments, creates significant uncertainty and potential costs. Despite these challenges, Fermi has secured a 6 GW federal air permit, signed EPC service agreements with TSK and Primoris, and has equipment in transit or at port. The convertible note offering provides a liquidity cushion to advance construction and tenant agreements.