FRMI — what changed in the latest 10-Q

Text added vs the prior filing · source: 10-Q · 2026-08-14

• Fermi Inc. (“Fermi,” “we,” “us,” or “our”) exists to power the artificial intelligence needs of tomorrow. We are developing a utility-scale and utility-grade private-grid powered campus for AI-centric customers—developing and leasing large-scale, grid-independent and interdependent energy generation…

• We were formed in January 2025 and have not generated revenue to date. Our efforts to date have focused on advancing site control and infrastructure readiness, engineering and procurement, permitting and regulatory activities, grid interconnection and fuel and water arrangements, and commercial disc…

• We previously stated that we intended to elect to be taxed as a REIT for U.S. federal income tax purposes commencing with our short taxable year ended December 31, 2025; however, we have determined to defer our REIT election. Accordingly, we do not have a REIT election in place for U.S. federal inco…

• a C corporation for our short taxable year ended December 31, 2025, and we expect to be taxable as a C corporation for U.S. federal income tax purposes at least through our taxable year ending December 31, 2026. It is possible that we may seek to qualify and elect to be taxable as a REIT for U.S. fe…

• On April 13, 2026, Fermi Mobile Gen LLC, a wholly owned subsidiary of the Company, entered into the First Amendment (the “Amendment”) to the master lease agreement (the “MPS Agreement”) with Mobile Power Solutions LLC (“MPS”). Fermi Inc. acknowledged and reaffirmed its guaranty of Fermi Mobile Gen L…

Text removed vs the prior filing · source: 10-Q · 2026-05-15

• Fermi Inc. (“Fermi,” “we,” “us,” or “our”) exists to power the artificial intelligence needs of tomorrow. We are building a utility-scale and utility-grade private power campus for AI-centric customers—developing and leasing large-scale, grid-independent and inter-dependent energy generation and hig…

• subject to the closing of additional land acquisitions and receipt of incremental Texas Commission on Environmental Quality (“TCEQ”) air permits. We plan to develop and lease powered shell space supported by an integrated, on-demand energy and site infrastructure platform, including on-site natural …

• We were formed in January 2025 and have not generated revenue to date. Our efforts to date have focused on advancing site control and infrastructure readiness, engineering and procurement, permitting and regulatory activities, grid interconnection and fuel and water arrangements, and commercial disc…

• On January 28, 2026, the Company formed its first long-lead equipment warehouse entity, Fermi Turbine Warehouse LLC (“FTW”), a Texas limited liability company and an indirect wholly owned subsidiary of the Company, and entered into an arrangement with Siemens Energy, Inc. (“Siemens”) for the purchas…

• The fixed price portion of the Siemens F-Class EPA is approximately $324.4 million, and as of March 31, 2026, the Company has paid approximately $276.6 million. In addition to the fixed price amount, the Company is obligated to pay shipping costs and applicable import duties, as incurred, pursuant t…

Text added vs the prior filing · source: 10-Q · 2026-08-14

• Financial Officer concluded that our disclosure controls and procedures were not effective at the reasonable assurance level as of June 30, 2026, due to the material weakness in our internal control over financial reporting described below.

• We have taken and will continue to take certain actions to remediate the material weakness. The following remediation actions have been completed or are substantially complete:

• •appointed a Chief Financial Officer and established an experienced finance team with public company financial reporting and internal controls expertise;

• •implemented financial and reporting systems to support internal controls requirements;

• •implemented formal policies and procedures to govern key financial processes and internal controls, including documented accounting policies aligned with U.S. GAAP standards and supported by external advisors;

Text removed vs the prior filing · source: 10-Q · 2026-05-15

• We have taken and will continue to take certain actions to remediate the material weakness, including:

• •designing and documenting an internal controls framework, including control activities over financial reporting, modeled on the Committee of Sponsoring Organizations (COSO) principles, with periodic internal reviews and testing;

• •implementing formal policies and procedures to govern key financial processes and internal controls, including documented accounting policies aligned with U.S. GAAP standards and supported by external advisors;

• •hiring additional qualified personnel with appropriate expertise in operational finance activities, accounting, and financial reporting, including the appointment of a Chief Financial Officer and financial reporting expert, and the establishment of an experienced finance team with public company fi…

• •enhancing segregation of duties across critical accounting and operational functions and implementing robust liquidity planning and cash management controls to support daily operating needs and strategic investments;

Text added vs the prior filing · source: 10-Q · 2026-08-14

• On January 27, 2026, a petition captioned 340 Energy, LLC v. Firebird LNG, LLC, et al. was filed in the District Court of Harris County, Texas, and subsequently removed to the Business Court of Texas, Eleventh Division (Cause No. 26-BC11B-0016). The complaint names as defendants Firebird LNG, LLC, M…

• under Texas Rule of Civil Procedure 91a on March 31, 2026. A hearing on the motion to dismiss was held on July 13, 2026. At the hearing the court took the motion under advisement and issued an order denying the motion to dismiss on August 11, 2026.

• On May 1, 2026, our former Chief Executive Officer, Toby Neugebauer, filed a verified petition and application for temporary restraining order and temporary injunction in the Business Court of the State of Texas, First Division, captioned Neugebauer v. Fermi Inc., et al., Cause No. 26-BC01B-0034. Th…

• On May 4, 2026, the parties entered into a Rule 11 Agreement under which Mr. Neugebauer agreed to withdraw his application for a temporary restraining order and temporary injunction with respect to Counts I, II, and III of the petition, subject to the Board’s consideration of the nomination of Larry…

• On July 2, 2026, Mr. Neugebauer, together with Vicksburg Investments Management LLC, filed a First Amended Petition in the same action, which added James Richard “Rick” Perry as an additional director defendant. The amended pleading asserts two counts. Count I seeks a declaration that the May 13, 20…

Text removed vs the prior filing · source: 10-Q · 2026-05-15

• Exchange Act of 1934, as well as Rule 10b-5 promulgated thereunder, and seeks unspecified damages and other relief (including attorneys’ fees and costs).

• On January 27, 2026, a petition captioned 340 Energy, LLC v. Firebird LNG, LLC, et al. was filed in the District Court of Harris County, Texas, and subsequently removed to the Business Court of Texas, Eleventh Division (Cause No. 26-BC11B-0016). The complaint names as defendants Firebird LNG, LLC, M…

• The Company, Fermi Equipment Holdco, LLC, and Firebird Equipment Holdco, LLC intend to move to dismiss the First Amended Petition, with a hearing on the anticipated motion set for June 22, 2026. Trial is currently scheduled to commence on May 24, 2027. As the petition notes, in connection with the t…

• Petition and Temporary Restraining Order and Temporary Injunction

• On May 1, 2026, our former Chief Executive Officer, Toby Neugebauer, filed a verified petition and application for temporary restraining order and temporary injunction in the Business Court of the State of Texas, First Division, captioned Neugebauer v. Fermi Inc., et al., Cause No. 26-BC01B-0034. Th…

Text added vs the prior filing · source: 10-Q · 2026-08-14

• •Servicing our debt requires a significant amount of cash. We may not have sufficient cash flow from our business to pay our substantial debt, and we may not have the ability to raise the funds necessary to settle conversions of the Notes in cash or to repurchase the Notes upon a fundamental change.

• •The future issuances of our common stock, including any shares issued upon conversion of the Notes, will dilute current shareholders and may reduce the market price of our common stock.

• •Wars, threats of war, terrorist attacks, cyberattacks, and threats may compromise the security, operability, or integrity of our power generation and transmission and distribution infrastructure and could have a material adverse effect on our business, financial condition, and results of operations…

• •Our use of technologies and systems that use AI or large language models, given the dynamic state of such technologies, may cause inadvertent or unexpected impacts that may introduce new operational, legal, and regulatory risks that could adversely affect our business, financial condition, or resul…

• •We were a C corporation for our short taxable year ended December 31, 2025, and expect to be taxable as a C corporation for our taxable year ending December 31, 2026. The timing of any future REIT election has not been determined, and it is possible that we will never make a REIT election.

Text removed vs the prior filing · source: 10-Q · 2026-05-15

• •Wars, threats of war, terrorist attacks, cyberattacks and threats may compromise the security, operability or integrity of our power generation and transmission and distribution infrastructure and could have a material adverse effect on our business, financial condition, and results of operations.

• •Our use of technologies and systems that use AI or large-scale language models (“LLMs”), given the dynamic state of such technologies, may cause inadvertent or unexpected impacts that may introduce new operational, legal, and regulatory risks that could adversely affect our business, financial cond…

• •We intend to elect to be classified as a REIT for U.S. federal income tax purposes. Our failure to qualify or maintain our qualification as a REIT for U.S. federal income tax purposes would reduce the amount of funds we have available for distribution and limit our ability to make distributions to …

• The termination of our Chief Executive Officer, Toby Neugebauer, and resignation of our Chief Financial Officer, Miles Everson, requires that we implement a leadership transition that could temporarily delay our ability to execute on certain aspects of our strategy as we search for new permanent exe…

• On April 17, 2026, the Company removed Toby Neugebauer from his position as President and Chief Executive Officer. On April 19, 2026, our Chief Financial Officer, Miles Everson, resigned from his position as Chief Financial Officer. On April 30, 2026, the Company terminated Toby Neugebauer’s employm…

Text added vs the prior filing · source: 10-Q · 2026-08-14

• On August 11, 2026, the Board approved the Amended and Restated Bylaws of the Company (the “Amended Bylaws”), effective as of such date. The principal changes effected by the Amended Bylaws are as follows:

• •Majority Voting Standard for Director Elections. The Amended Bylaws changed the voting standard for the election of directors from a plurality of the votes cast by holders of shares present in person or represented by proxy to the affirmative vote of holders of a majority of the outstanding shares …

• •Collective Proceedings Limitation. The Amended Bylaws added a new Article X, which provides that proceedings subject to resolution under the Bylaws or the Company’s Certificate of Formation must be brought only as an individual action or derivative proceeding, and, to the fullest extent permitted b…

• The foregoing description of the Amended Bylaws does not purport to be complete and is qualified in its entirety by reference to the full text of the Amended Bylaws, a copy of which is filed as Exhibit 3.2 to this Quarterly Report on Form 10-Q and is incorporated herein by reference.

• On August 11, 2026, in order to comply with the Company’s Bylaws, the Board reclassified Mr. Jeffrey S. Stein as a Class I director and Mr. Lee McIntire as a Class III director.