Strategy Announces 5M Series A Perpetual Strife Preferred Stock to Fund Bitcoin Acquisition

• 5M shares of Series A preferred stock offered at 10% fixed dividend.
• Strategy plans to use proceeds for Bitcoin purchases and working capital.
• Redemption and repurchase rights provided under specific conditions.

Strategy (Nasdaq: MSTR; STRK) has announced plans to offer 5,000,000 shares of its Series A Perpetual Strife Preferred Stock. The planned public securities offering will be registered under the Securities Act of 1933 and depends on market conditions. Strategy will utilize proceeds from this offering to fund general corporate activities such as Bitcoin acquisition and operational capital.

Strategy’s New Stock Offers 10% Dividend Rate

Each share of Series A Perpetual Strife Preferred Stock will generate 10.00% annual dividends based on the stated stock value. The company will start to make quarterly dividend payments in cash from June 30, 2025. Unpaid dividends will accumulate at successive rates from 10% each year until it reaches 18%.

The company possesses exclusive rights to redeem any outstanding shares of the perpetual strife preferred stock. The perpetual strife preferred stock can only be redeemed when less than 25% of the issued shares remain outstanding or during specific tax-related events. Moreover, the preferred stock holders have a right to force Strategy to repurchase their shares when fundamental changes occur.

The perpetual strife preferred stock has a specific liquidation value of $100 per issued share. However, the preferred stock trading price will determine the daily adjustment of this preference. The adjustment liquidation preference will be determined by the highest value of these three values. These include the stated value at $100 per share, the last reported sale price and the average of the last reported sale price in the last ten trading days.

Bitcoin Acquisition Strategy

Strategy aims to utilize these proceeds to fund its Bitcoin acquisition strategy. This strategic move shows the company’s long-term commitment to Bitcoin as a core asset and store of value. Moreover, the offering enables investors to earn steady income from dividends.

Morgan Stanley & Co. LLC, Barclays Capital Inc., Citigroup Global Markets Inc. and Moelis & Company LLC will serve as joint book-running managers to administer the offering. The company filed a shelf registration statement with the Securities and Exchange Commission which allows businesses to proceed with the offering through a prospectus supplement framework.

Strategy’s issuance of preferred shares helps the company to reinforce its capital structure and maintain its strategic flexibility for future decisions. The preferred stock option allows the company to operate independently to continue its Bitcoin-oriented mission. The move may impact how the company handles takeover defenses because preferred shareholders could obtain extra rights which will further complicate acquisitions.