Big Digital Energy (NASDAQ: BGDE) sold 16,700 shares of newly designated Series D Convertible Preferred Stock to Six Thirty AI for gross proceeds of $15.03 million, according to an 8-K filed Monday. The company also issued a five-year warrant for 926,748 shares of common stock at $10.81 per share.
Big Digital's raise comes on the same day it announced a 50-50 venture with 10NetZero, an energy-infrastructure company, to acquire a power-ready site in Hood County, Texas, for AI datacenter development. The filing does not set aside the Series D proceeds for a specific project. Management has described the company's direction as a shift from bitcoin and digital infrastructure toward AI/HPC datacenter operations.
Six Thirty AI, the sole purchaser, is controlled by Josh Kilgore, Phil Stanley, and Cody Smith, who serve as Big Digital's executive chairman, CEO, and COO, respectively. A Special Transactions Committee of disinterested directors and the company's Audit Committee reviewed and approved the deal.
Deal structure
The preferred shares have a stated value of $1,000 each, but they were sold for $900, which is a 10% discount. They may be converted into common stock starting August 30, 2026, at a variable conversion price equal to 95% of the lowest daily VWAP during the five trading days immediately before conversion, subject to a $1.80 floor. Dividends build at 5% per year and are payable quarterly in extra preferred shares or cash, at the company's election.
The warrant exercise price of $10.81 represents 120% of the common stock's closing price immediately before closing. It is subject to standard anti-dilution adjustments.
Big Digital retained Northland Securities as exclusive placement agent and paid a 6% cash fee on gross proceeds.
Lender layering
Six Thirty AI acquired the preferred stock with borrowed funds. Under a separate letter agreement, Big Digital consented to Six Thirty AI's pledge of the preferred shares to YA II PN, acting as collateral agent for the lenders. The warrant was turned over to the lenders as the facility's commitment fee. The lenders also have the right to exchange outstanding loan obligations for Series D preferred shares or settle using common stock issued on conversion.
Although the buyer is management-linked, the capital was borrowed, and some economic exposure has been transferred to third-party lenders.
Nasdaq limits and shareholder vote
Big Digital is barred under the transaction documents from issuing conversion shares or warrant shares if doing so would violate Nasdaq's exchange cap. It has also agreed to hold its next annual meeting no later than November 14, 2026, and to include a proposal asking stockholders to approve issuances above that cap.
Big Digital must file an initial resale registration statement by July 20, 2026, covering the conversion shares and warrant shares.
