TYSONS CORNER, Va. - MicroStrategy Incorporated (NASDAQ:MSTR), known for its investments in bitcoin, announced its intention to offer $500 million of convertible senior notes due 2031 to qualified institutional buyers, with an additional option for purchasers to buy up to $75 million more.
The private offering is contingent on market conditions and other factors, and there is no certainty regarding the completion or terms of the offering.
The notes, which are unsecured senior obligations, will bear interest payable semi-annually and are set to mature on March 15, 2031, unless repurchased, redeemed, or converted earlier under their terms. Starting March 22, 2028, MicroStrategy may choose to redeem the notes for cash completely or partially.
Furthermore, note holders will have the right to require MicroStrategy to repurchase their notes for cash on September 15, 2028. Conversion of the notes into cash, MicroStrategy's class A common stock, or a combination thereof, will be at the company's discretion, with specific conversion conditions applying before September 15, 2030, and open conversion thereafter until just before the maturity date. The interest rate and initial conversion rate will be determined at the offering's pricing.
The intended use for the net proceeds from the sale of the notes is to purchase additional bitcoin and for general corporate purposes, aligning with MicroStrategy's strategy of using bitcoin as its primary treasury reserve asset.
The notes and any class A common stock that may be issued upon their conversion will not be registered under the Securities Act of 1933 or any state securities laws, and they may not be offered or sold in the United States absent registration or an exemption from registration requirements. The notes are to be offered only through a private offering memorandum.
MicroStrategy considers itself as the world's first Bitcoin development company, focusing on accumulating bitcoin through its financial activities, advocacy, and technology innovation. The company also develops enterprise analytics software and is working on bitcoin applications.
The press release includes forward-looking statements regarding the offering's size, timing, and anticipated use of proceeds, which are subject to market conditions and other important factors detailed in MicroStrategy's filings with the Securities and Exchange Commission.
This news article is based on a press release statement and does not constitute an offer to sell or a solicitation of an offer to buy any securities.
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