Fermi Ex-CEO Toby Neugebauer Sues Company After Firing

Former Fermi CEO Toby Neugebauer sued the company for wrongful termination after he was axed from the company and removed from its board of directors.

Neugebauer alleged in a Texas Business Court lawsuit on Friday that the Amarillo, Texas-based data center real estate investment trust fired him without cause, Bisnow reported. The accusation contradicts what Fermi said in a Securities and Exchange Commission filing; it reported that Neugebauer was fired for violating company policies and his employment agreement. Fermi also flip-flopped in its statement regarding the future of Neugebauer’s board seat. After reporting that he’d remain on the board, the company said he’d been removed.

In the lawsuit, Neugebauer said a director can only be dismissed by the company’s shareholders. He also accuses Fermi’s board of misleading investors and the public about his exit from the company.

Neugebauer called for an immediate sale of Fermi.

The firing comes amid a rocky stretch for the company co-founded by former Texas Gov. Rick Perry as it fends off accusations of overinvestment in artificial intelligence. Since the REIT went public last year with a market valuation of $19 billion, its stock has tumbled 84 percent from its peak, Bloomberg reported.

It failed to secure a tenant for its flagship development, Project Matador, and consequently lost a $150 million construction loan. Per Fermi, an unnamed tenant pulled out of the 7,500-acre, 17-gigawatt project planned for Amarillo. It remains unfinished, Bloomberg reported.

“Going from zero to a 17-gigawatt AI hyper campus in one leap before they had a single tenant or a dollar of project finance — that was a lot in hindsight,” Schneider Capital Group’s Timm Schneider told the outlet.

Plus, Neugebauer’s exit isn’t the only C-suite shakeup at Fermi. Chief financial officer Miles Everson left two days after Neugebauer’s firing. The company announced Rob Masson II would replace Everson on an interim basis.

— Jess Hardin