1. FRMI's share price dropped 33% due to tenant agreement termination. 2. The terminated agreement was crucial for $150 million construction funding. 3. Hagens Berman is investigating possible investor misguidance by FRMI. 4. FRMI's stock is now 52% lower than its October IPO price. 5. Investor trust may decline with ongoing legal scrutiny on FRMI's disclosures.
FAQ
Why Very Bearish?
The significant drop in FRMI's share price indicates a loss of investor confidence, reminiscent of similar incidents in history where abrupt news leads to long-term sell-offs, such as the 2008 financial crisis affecting mortgage-backed securities.
How important is it?
The investigation into FRMI regarding potential misleading communications about tenant agreements greatly impacts investor confidence, making this a pivotal moment for the company.
Why Long Term?
The investigation and loss of a major tenant will likely cast a long shadow on investor confidence and future financing efforts, similar to companies facing legal issues that linger over fiscal health and market perception.
Fermi Inc. (FRMI) Shares Plunge 33% Following Key Tenant Agreement Termination
On December 12, 2025, Fermi Inc. (NASDAQ: FRMI) experienced a dramatic decline of approximately 33% in its stock price. This significant drop came after the company announced the termination of a crucial agreement with a prospective anchor tenant for its Project Matador, which is under development at Texas Tech University. The deal, which would have provided $150 million to support construction, is now in jeopardy, leading to heightened concerns among investors.
Details of the Tenant Agreement Termination
Fermi Inc.'s Project Matador is touted as a groundbreaking multi-gigawatt energy and data center campus aiming to meet the growing demands for artificial intelligence infrastructure. The company raised nearly $784 million by issuing over 37 million shares at a price of $21 each on October 2, 2025.
The sudden announcement regarding the termination of the Advanced in Aid of Construction Agreement (AICA) with the First Tenant has drawn the attention of Hagens Berman, a national shareholder rights firm. The firm has initiated an investigation to determine if Fermi misled investors about the strength of the initial agreement.
- Termination Announcement Date: December 11, 2025
- Stock Price Drop: 33%
- Closing Price on December 12: $10.09
- Percentage Below October IPO Price: Nearly 52%
Implications of the Market Reaction
The immediate market response to Fermi's announcement was swift. Investors reacted negatively, leading to a sharp decline in stock value. Reed Kathrein, a partner at Hagens Berman, highlighted the investigation's focus: “We’re focused on whether the company has been sufficiently transparent about the strength and terms of the agreements with Tenant 1.”
Investor Guidance and Legal Actions
Hagens Berman is actively calling on Fermi investors who have incurred significant losses due to this recent development to come forward. They are also seeking information from individuals who may assist in the ongoing investigation.
Investors can submit their losses or share information by visiting www.hbsslaw.com/investor-fraud/frmi or by contacting the firm directly at [email protected] or by phone at 844-916-0895.
Whistleblower Information
Individuals with non-public information about Fermi Inc. are encouraged to consider their options to assist in the investigation. The SEC Whistleblower program offers protection and potential rewards for original information provided, amounting to up to 30% of any successful recovery made by the SEC.
About Hagens Berman
Hagens Berman is a globally recognized plaintiffs’ rights law firm specializing in complex litigation focused on corporate accountability. The firm has successfully represented investors, whistleblowers, and consumers in numerous cases of corporate misconduct, securing over $2.9 billion in recoveries. More information about their work can be found at hbsslaw.com.