Hyperscale Data, Inc. 8-K

What Happened

• On June 23, 2026, Hyperscale Data, Inc.’s wholly owned subsidiary Alliance Cloud Services, LLC entered a Master Services Agreement with a customer to deploy approximately 20 megawatts (MW) of AI compute capacity in phases at the company’s Dowagiac, Michigan data center campus. The contract grants the customer an exclusive license to use a Service Area for an initial 10‑year term plus two five‑year extension options and requires the Provider to construct, equip and commission two phases of capacity.

Key Details

• Phases: Phase 1 = 10 MW targeted 90 days after execution (target ready‑for‑service date Sept 21, 2026); Phase 2 = additional 10 MW targeted 180 days after execution (full deployment targeted by end of 2026).
• Up‑front cash: $5,000,000 non‑refundable one‑time charge paid at execution; $5,600,000 cash security deposit also delivered at execution (reduced by one‑third on each of the 1st, 2nd and 3rd anniversaries of Phase 2 delivery if no customer default).
• Contract value: Approximately $1.2 billion over the Term if the customer exercises both five‑year extensions (subject to Provider performance). If the customer exercises a right‑of‑first‑offer for an additional 32 MW within two years, potential value rises to ~ $3.0 billion.
• Other: Agreement includes recurring monthly colocation fees (part prepaid), additional one‑time fit‑out payments, service credits/penalties, termination and indemnity provisions. No prior material relationship between the parties was disclosed.

Why It Matters

• This is a potentially material commercial arrangement: it commits Hyperscale’s Dowagiac facility to a large AI customer and could generate substantial recurring revenue over many years if extensions and expansion are exercised.
• The customer’s immediate $10.6M in upfront cash (fee + deposit) improves near‑term liquidity for the Provider, while the multiyear nature of the deal provides revenue visibility—subject to the Provider meeting construction and service obligations.
• Key investor considerations include execution risk (meeting construction and delivery targets), concentration risk (single large customer), and the contingent upside if the customer takes the additional 32 MW.