Amendments to Bylaws Form 8 K

Item 5.03 Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.

As previously disclosed, on September 23, 2024, Applied Digital Corporation, a Nevada corporation (the "Company"), entered into a Dealer Manager Agreement with Preferred Capital Securities, LLC (the "Dealer Manager"), pursuant to which the Dealer Manager agreed to serve as the Company's agent and dealer manager for the Company's registered offering (the "Series E-1 Offering") of up to $62,500,000 of the Company's Series E-1 Redeemable Preferred Stock, par value $0.001 per share (the "Series E-1 Preferred Stock").

On November 8, 2024, the Company filed a Certificate of Designations of the Powers, Preferences and Relative, Participating, Optional and Other Restrictions of Series E-1 Preferred Stock of the Company (the "Certificate of Designations") with the Secretary of State of the State of Nevada to establish the rights, privileges, preferences, and restrictions of the Series E-1 Preferred Stock. As set forth in the Certificate of Designations, the Company designated 62,500 shares of preferred stock as Series E-1 Preferred Stock. The Certificate of Designations was filed in connection with the initial settlement under the Series E-1 Offering. The Series E-1 Offering remains ongoing.

As previously disclosed, the Company designated 5,000,000 shares of its authorized capital stock as preferred stock and of those shares designated (i) 70,000 shares of preferred stock as Series A Convertible Preferred Stock, par value $0.001 per share(the "Series A Preferred Stock"), (ii) 50,000 shares of preferred stock as Series B Convertible Preferred Stock, par value $0.001 per share(the "Series B Preferred Stock"), (iii) 660,000 shares of preferred stock as Series C Convertible Redeemable Preferred Stock, par value $0.001 per share (iv) 1,380,000 shares of preferred stock as Series D Convertible Redeemable Preferred Stock, par value $0.001 per share(the "Series D Preferred Stock"), (v) 2,000,000 shares of preferred stock as Series E Redeemable Preferred Stock, par value $0.001 per share (the "Series E Preferred Stock") and (vi) 53,191 shares of preferred stock as Series F Convertible Preferred Stock, par value $0.001 per share (the "Series F Preferred Stock"). As a result of filing the Certificate of Designations on November 8, 2024 and the filing of Certificates of Withdrawal of Certificate of Designations on October 24, 2024 of each of the Series A Preferred Stock, the Series B Preferred Stock and the Series D Preferred Stock, the Company had 2,224,309 shares of undesignated preferred stock as of the date of this Current Report on Form 8-K.

The following is a summary of the principal terms of the Certificate of Designations:

Ranking

The Series E-1 Preferred Stock ranks, with respect to the payment of dividends and rights upon the Company's liquidation, dissolution or winding up of the Company's affairs: (i) prior or senior to all classes or series of the Company's common stock, par value $0.001 per share (the "Common Stock"), and any other class or series of equity securities, if the holders of Series E-1 Preferred Stock are entitled to the receipt of dividends or of amounts distributable upon liquidation, dissolution or winding up in preference or priority to the holders of shares of such class or series; (ii) on a parity with the Series E Preferred Stock and the Series F Preferred Stock, in proportion to their respective amounts of accrued and unpaid dividends per share or liquidation preferences; (iii) on a parity with other classes or series of the Company's equity securities issued in the future if, pursuant to the specific terms of such class or series of equity securities, the holders of such class or series of equity securities and the holders of Series E-1 Preferred Stock are entitled to the receipt of dividends and of amounts distributable upon liquidation, dissolution or winding up in proportion to their respective amounts of accrued and unpaid dividends per share or liquidation preferences, without preference or priority of one over the other, or as otherwise expressed to be pari passu with the Series E-1 Preferred Stock; (iv) junior to any class or series of the Company's equity securities if, pursuant to the specific terms of such class or series, the holders of such class or series are entitled to the receipt of dividends or amounts distributable upon liquidation, dissolution or winding up in preference or priority to the holders of the Series E-1 Preferred Stock (none of which class or series is currently designated); and (v) junior to all of the Company's existing and future debt indebtedness.

Maturity

The shares of the Series E-1 Preferred Stock have no stated maturity and once issued will remain outstanding indefinitely unless they are redeemed by the Company. The Company is not required to set apart for payment funds to redeem the Series E-1 Preferred Stock and may settle a redemption of the Series E-1 Preferred Stock in cash or shares of Common Stock; provided, however, that no Holder Optional Redemption (as defined below) with respect to any share of Series E-1 Preferred Stock may be settled in Common Stock prior to the first anniversary of the date of its issuance and the Company may not exercise the Company Optional Redemption (as defined below) with respect to any share of Series E-1 Preferred Stock prior to the second anniversary of the date of its issuance (the "Redemption Eligibility Date").

Dividend Rights

The holders of the Series E-1 Preferred Stock are entitled to receive a cumulative dividend at a fixed annual rate of 9% per annum of the Stated Value of the Series E-1 Preferred Stock, or $1,000.00, per year (computed on the basis of a 360-day year consisting of twelve 30-day months). Dividends will be declared and accrued monthly. Dividends are payable upon the approval of the board of directors of the Company, which may not be monthly, out of legally available funds in cash. The Series E-1 Preferred Stock ranks on parity with the Series E Preferred Stock, the Series F Preferred Stock and any classes or series of preferred stock otherwise expressed to be pari passu with the Series E-1 Preferred Stock with respect to the right to receive payment of any dividends in proportion to their respective amounts of accrued and unpaid dividends per share. Unless full cumulative dividends on shares of Series E-1 Preferred Stock for all past dividend periods have been paid (or set apart for payment), the Company may not declare or pay dividends with respect to any shares of Common Stock or other stock ranking junior to the Series E-1 Preferred Stock for any period.

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