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# Wolfspeed Gets Conditional Offer For Up To $1.5 Billion Pentagon Loan, With Warrants On 7.5% Of Equity
- URL: https://www.bullished.co/wolfspeed-gets-conditional-offer-for-up-to-1-5-billion-pentagon-loan-with-warrants-on-7-5-2f37159a/
- Published: 2026-10-07T20:36:39.000Z
- Updated: 2026-10-11T00:20:30.000Z
- Description: The 30-year facility would refinance 2030 notes, but it depends on Congress, due diligence and a push to convert convertible notes into stock.
- Author: Matteo Parrino
- Tags: SEC Filings, WOLF, Industry: Technology

Wolfspeed has a conditional commitment letter from the U.S. Department of War for a [senior secured loan of up to $1.5 billion](https://www.sec.gov/Archives/edgar/data/0000895419/000119312526416987/d122407d8k.htm?ref=bullished.co), according to an 8-K filed Wednesday. The government would receive warrants on up to 7.5% of the company's equity, and nothing is final until definitive agreements are signed.

## What the 8-K says

The commitment letter comes from the Department of War, acting through its Office of Strategic Capital. It contemplates a delayed-draw term loan, meaning money drawn in stages, with a 30-year maturity and a 36-month window to draw.

The loan has up to four tranches. The initial $600 million would repay in full Wolfspeed's first lien senior secured notes due 2030 and cover fees. The other $900 million, in tranches of $200 million to $400 million, would fund the buildout of domestic silicon carbide wafer and power device production, domestic gallium nitride production, GaN-on-SiC radio frequency wafer technology and radiation-hardening capabilities.

The interest rate would be the U.S. Treasury rate of similar maturity plus a risk premium provisionally set between 1.25% and 1.75%, subject to diligence and negotiation. Interest would be paid quarterly, but could be added to principal for the first five years if no default occurs. After that, payments would be in cash and principal would amortize on a 25-year straight-line basis.

## The strings attached

Wolfspeed would issue warrants, issued pro rata as each tranche is funded, for 5% and 2.5% of its outstanding equity. Both are measured on a fully diluted basis, and exercise prices would be tied to mutually agreed volume-weighted average share prices. They would run ten years.

The terms also include control provisions that would last until the loan is repaid and the commitments end, or until maturity, whichever is later:

- Restrictions on changes of control with parties other than permitted persons.
- A board majority of U.S. citizens and a chief executive who is a national of a permitted jurisdiction.
- A U.S. principal headquarters.
- A non-voting board observer designated by the Office of Strategic Capital.

Funding also requires Wolfspeed to use commercially reasonable efforts to equitize, or convert into stock, a substantial majority of its convertible notes. It must contribute at least $750 million of qualifying sources received after June 28, 2026, or another amount the office sets in diligence.

## What it changes, and what to watch

For holders, the filing offers a path to replace the 2030 notes with long-dated government debt, paired with dilution from the warrants and any equity raised to meet the contribution. The filing warns that no assurance exists of definitive agreements, funding or closing on these terms, or at all.

Several conditions sit outside Wolfspeed's control, including congressional authorization, appropriations and concurrence from the Office of Management and Budget. The office's diligence is also at its sole discretion, and offtake agreements must be acceptable to it.

In after-hours trading Wednesday, the stock traded at $40.18 (market data), up about 28% from the regular-session close of $31.37.

The next marker is whether Wolfspeed and the Office of Strategic Capital reach definitive agreements, and whether Congress authorizes the funding the commitment depends on.

### Sources

- [8-K Filing — WOLFSPEED, INC. (WOLF)](https://www.sec.gov/Archives/edgar/data/0000895419/000119312526416987/d122407d8k.htm?ref=bullished.co) — SEC EDGAR
- [Exhibit d122407dex991.htm — WOLFSPEED, INC. 8-K exhibit](https://www.sec.gov/Archives/edgar/data/0000895419/000119312526416987/d122407dex991.htm?ref=bullished.co) — SEC EDGAR