Applied Digital (NASDAQ: APLD) completed a $1.59 billion private offering of 7.000% senior secured notes due 2031, issued through its subsidiary APLD ComputeCo 3 LLC.
The company will use net proceeds to fund 150 MW of critical IT load at ELN-04, the fourth building at Polaris Forge 1, its AI data center campus in Ellendale, North Dakota.
The notes were issued at par and sold to qualified institutional buyers under Rule 144A and to non-U.S. buyers under Regulation S, with Goldman Sachs & Co. LLC serving as representative of the initial purchasers.
Interest is payable semi-annually at 7% per annum beginning December 15, 2026, with the notes maturing on June 15, 2031, unless earlier redeemed or repurchased.
Proceeds will also repay the principal balance plus accrued interest on a $300 million bridge loan from Goldman Sachs Bank USA, which Applied Digital had announced in May with a 364-day maturity and interest at SOFR plus 275 basis points.
The notes are senior secured obligations backed by first-priority liens on substantially all assets of the issuer and its guarantors, replacing short-term construction borrowing with five-year secured debt.
The Polaris Forge 1 campus is anchored by CoreWeave, with Applied Digital finalizing 400 megawatts of long-term leases in August 2025 that carry total anticipated lease revenue of approximately $11 billion.
This latest raise follows a $2.15 billion senior secured notes offering that closed in March 2026, structured to finance the company’s Polaris Forge 2 campus in Harwood, North Dakota.
Illinois Governor JB Pritzker signed Senate Bill 3019, enacting a 0.2% tax on cryptocurrency transactions as part of the state’s $55.9 billion fiscal 2027 budget, projected to generate more than $800 million in additional tax revenue.
The Digital Asset Privilege Tax Act takes effect January 1, 2027, charging 0.2% of the value of the digital asset involved in each transaction, with out-of-state brokers subject to the rule once their Illinois sales reach $100,000.
Unlike capital gains or income taxes, the Illinois levy does not wait for a profit, firing on the act of transacting itself regardless of whether the customer made money on the trade.
The Crypto Council for Innovation called the measure “the most punitive digital asset tax in the country” and warned it would create “a profound chilling effect on digital asset activity in Illinois.”
Chicago hosts major crypto and trading firms including Jump Crypto and Bitnomial, and industry groups fear the tax will push such companies toward more favorable jurisdictions.
Industry observers noted the most likely pathway to changing or mitigating the tax would be through a lawsuit, given the measure was inserted into a large budget bill rather than debated as standalone legislation.
On the private credit side, Moody’s Ratings global head of private credit Marc Pinto warned that AI infrastructure is reshaping lending markets while software-heavy loan books build toward a dangerous refinancing test.
Speaking on Bloomberg Open Interest on June 16, Pinto said the sector is entering “a more complex and more volatile phase,” with asset-based lending around data centers and energy growing fast while software debt portfolios face mounting uncertainty.
Pinto said it “really is the tale of two cities: it’s the best of times, and it’s the worst of times,” describing how the largest technology companies and top private credit firms are “doing a dance” to finance data center buildouts.
Business development companies carry roughly 25% exposure to software companies on average, leaving lenders uncertain whether that exposure represents opportunity or risk as AI reshapes the competitive landscape.
Many loans now appearing on non-accrual lists were originated in 2020, 2021, and early 2022, when Pinto said they were underwritten in what he called a “Goldilocks-type market” of near-zero rates and generous growth assumptions.
Pinto said the first major refinancing wave hits around 2028 and will serve as the definitive sorting mechanism, adding “we probably won’t know that until 2028 when we see the first refinancing wall.”
