TeraWulf just put $850 million of new debt on its balance sheet. The company completed its convertible note offering on August 20, 2025, and the filing makes clear this is not a defensive capital raise.
The notes carry a 1.00% annual coupon, mature September 1, 2031, and were issued at par. Net proceeds after discounts and estimated expenses came to approximately $828.7 million. Morgan Stanley acted as the initial purchaser under a purchase agreement dated August 18, 2025. The initial purchasers also received an option to buy up to an additional $150 million in notes within 13 days of issuance, which would bring the maximum offering size to $1 billion.
The Conversion Math and What It Implies
The initial conversion rate is 80.4602 shares per $1,000 principal amount, equivalent to a conversion price of approximately $12.43 per share. $WULF's price context as of May 20, 2026 shows the stock trading well above that level, which means the conversion option carries real economic weight for noteholders. Prior to June 1, 2031, conversion is conditional on certain triggering events. After that date, holders can convert freely until two scheduled trading days before maturity.
The company retains the right to settle conversions in cash, shares, or a combination, at its election. That flexibility matters for dilution modeling. If $WULF's stock stays above the conversion price through 2031, the company faces a choice between cash outflow and share issuance. The capped call structure addresses part of that tension.
The Capped Call Is the Structural Detail That Matters
TeraWulf entered into capped call transactions on August 18, 2025, spending approximately $85.5 million of the note proceeds to buy them. The cap price is $18.76 per share, which represents a 100% premium to the last reported sale price on August 18. The capped calls are designed to reduce dilution upon conversion up to that cap level, and to offset cash payments above principal on converted notes, subject to the cap.
The structure is standard for convertible offerings of this size, but the cap price is worth anchoring. At $18.76, the dilution protection runs out. Any conversion above that price delivers full dilution to existing shareholders. $WULF's 52-week high as of May 20, 2026 was $25.76, reached on May 6, 2026, which puts the cap price inside the recent trading range. That gap is the dilution exposure that the capped call does not cover.
Where the Proceeds Are Going
The filing is specific about use of proceeds in a way that goes beyond boilerplate. After the $85.5 million allocated to capped calls, the remaining net proceeds are designated to fund a portion of the company's data center expansion and for general corporate purposes. The data center expansion language is an explicit stated use, not inferred from strategy context.
For a Bitcoin miner where power strategy, production scale, and fleet efficiency frame equity risk, a capital raise of this size directed at data center expansion is a direct signal about where management expects the next phase of growth to come from. The company's latest reported revenue was $34.01 million for the period ending March 31, 2026. An $850 million financing against that revenue base is a large bet on future capacity, not current cash flow coverage.
Redemption Terms and the 2028 Trigger
The company cannot redeem the notes before September 6, 2028. After that date, redemption is available only if $WULF's stock has traded at or above 130% of the then-current conversion price for at least 20 trading days within any 30 consecutive trading day period ending the day before the redemption notice. At the initial conversion price of $12.43, the 130% threshold works out to approximately $16.16 per share. Given recent price levels, that threshold is not a distant scenario.
If a fundamental change occurs before maturity, holders can require repurchase at 100% of principal plus accrued interest. The indenture trustee is Wilmington Trust, National Association. Default acceleration requires either trustee action or holders of at least 25% of outstanding principal to declare amounts due.
Sawse Signal
$WULF's Filing Risk Score sits at 100 and its Event Momentum score matches that ceiling, both driven by the density and materiality of capital markets activity this filing represents. The elevated disclosure cadence around this offering is the direct source of those readings. The BTC Exposure Score of 80 reflects the company's position as a Bitcoin miner where production economics and Bitcoin price are the dominant equity drivers. The Insider Activity Signal at 9 is the one dimension that sits quiet, indicating no unusual Form 4 cluster activity around this transaction.
The stock has gained approximately 88% year to date through May 20, 2026, and roughly 452% over the trailing twelve months from the same date. The 52-week low was $3.31 on May 15, 2025. That kind of move creates a very different financing environment than the company faced a year ago, and the convertible structure reflects it: a low coupon, a conversion premium set well above recent lows, and capped call protection purchased at a 100% premium to the pricing date close.
The open question is whether the data center capacity this raise funds translates into revenue at a pace that justifies the debt load. The next quarterly filing will be the first place to track construction progress, capital deployment timing, and any change in the company's production economics against the new debt service obligation.
Research only. Not investment advice.