---
schema_version: "secwatch.filing_event.v1"
accession: "0001144879-24-000097"
form_type: "8-K"
ticker: "APLD"
cik: "0001144879"
company_name: "Applied Digital Corp."
filed_at: "2024-04-30T23:59:59+00:00"
generated_at: "2026-06-03T04:04:28.499135+00:00"
event_type: "debt"
sentiment: "neutral"
materiality_score: 0.55
calibrated_materiality_score: 0.55
confidence: "high"
source: SEC EDGAR
---

# Applied Digital draws second $10M convertible note, completing $50M PPA with YA II PN

## Summary
- Issued $10M convertible unsecured promissory note at 5% OID for $9.5M cash on April 24, 2024.
- Note matures April 8, 2025, bears 0% interest (18% on default), convertible at a variable conversion price.
- Completes the $50M Prepaid Advance Agreement; first $40M note was issued March 27, 2024.
- Note proceeds include monthly amortization trigger if certain events occur (e.g., registration failure).

## SEC filing metadata
- accession: 0001144879-24-000097
- form_type: 8-K
- ticker: APLD
- cik: 0001144879
- company_name: Applied Digital Corp.
- filed_at: 2024-04-30T23:59:59+00:00
- event_type: debt
- sentiment: neutral
- materiality_score: 0.55
- calibrated_materiality_score: 0.55
- confidence: high
- sec_items: 1.01, 2.03, 3.02, 9.01
- EDGAR index: https://www.sec.gov/Archives/edgar/data/1144879/000114487924000097/0001144879-24-000097-index.htm
- EDGAR primary document: https://www.sec.gov/Archives/edgar/data/1144879/000114487924000097/apld-20240424.htm

## Machine-readable alternates
- HTML: https://secwatch.observer/filing/0001144879-24-000097
- JSON: https://secwatch.observer/filing/0001144879-24-000097.json
- Plain text: https://secwatch.observer/filing/0001144879-24-000097.txt

## Key facts
- Debt Financings
  Applied Digital Corp. incurred convertible notes of $10 million with YA II PN, LTD..
  - Instrument: convertible notes
  - Principal: $10 million
  - Counterparty: YA II PN, LTD.
  - Event: incurrence
  source text: issue discount and a deduction of a $25,000 due diligence fee (the “First Promissory Note”). Under the PPA, the issuance of the second Promissory Note in the principal amount of $10 million in consideration of a cash payment by the Investor of $9.5 million, representing a five percent original issue discount (the “Second Promissory Note”) was subject to the
  evidence_url: https://www.sec.gov/Archives/edgar/data/1144879/000114487924000097/0001144879-24-000097-index.htm
- Material Agreements
  Applied Digital Corp. entered into Second Promissory Note with YA II PN, LTD. valued at $10,000,000 (effective 2024-04-24).
  - Action: entry
  - Agreement: notes offering
  - Counterparty: YA II PN, LTD.
  - Value: $10,000,000
  - Effective: 2024-04-24
  source text: d in a Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on April 1, 2024, Applied Digital Corporation, a Nevada corporation (the “Company”) entered into a Prepaid Advance Agreement (the “PPA”) dated March 27, 2024, with YA II PN, LTD., a Cayman Islands exempt limited partnership (the “Investor”). In accordance with the terms of the PPA, the Investor agreed to advance up to $50 million to the Company pursuant to two convertible unsecured promissory notes (the “Promissory Notes”), which are convertible into shares of the Company’s Common Stock, par value $0.001, per share (the “Common Shares”).
  evidence_url: https://www.sec.gov/Archives/edgar/data/1144879/000114487924000097/0001144879-24-000097-index.htm
- Material Agreements
  Applied Digital Corp. entered into Prepaid Advance Agreement with YA II PN, LTD. valued at $50,000,000 (effective 2024-03-27).
  - Action: entry
  - Agreement: credit facility
  - Counterparty: YA II PN, LTD.
  - Value: $50,000,000
  - Effective: 2024-03-27
  source text: As previously reported in a Current Report on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on April 1, 2024, Applied Digital Corporation, a Nevada corporation (the “Company”) entered into a Prepaid Advance Agreement (the “PPA”) dated March 27, 2024, with YA II PN, LTD., a Cayman Islands exempt limited partnership (the “Investor”).
  evidence_url: https://www.sec.gov/Archives/edgar/data/1144879/000114487924000097/0001144879-24-000097-index.htm

This AI-assisted summary is a reading aid. Review the linked SEC EDGAR filing before relying on any specific claim.