TYSONS CORNER, Va. Friday, June 14, 2024- Business intelligence company MicroStrategy announced plans to raise $500 million through a private offering of convertible senior notes. The company intends to use the proceeds to acquire more Bitcoin and for general corporate purposes.1
Due in 2032, the notes will be offered to qualified institutional buyers and convertible into cash, shares of MicroStrategy’s common stock, or a combination of both.
The interest rate and conversion terms will be determined later.
MicroStrategy has been a vocal proponent of Bitcoin and holds a significant amount of the cryptocurrency. The company says it sees bitcoin as its primary treasury reserve asset.
The offering is subject to market conditions and is not guaranteed to be completed.
The statement said:
“The notes will be unsecured, senior obligations of MicroStrategy and will bear interest payable semi-annually in arrears on June 15 and December 15 of each year, beginning on December 15, 2024. The notes will mature on June 15, 2032, unless earlier repurchased, redeemed or converted in accordance with their terms. Subject to certain conditions, on or after June 20, 2029, MicroStrategy may redeem for cash all or any portion of the notes. If MicroStrategy redeems fewer than all the outstanding notes, at least $75 million aggregate principal amount of notes must be outstanding and not subject to redemption as of the relevant redemption notice date. Holders of the notes will have the right to require MicroStrategy to repurchase for cash all or any portion of their notes on June 15, 2029. The notes will be convertible into cash, shares of MicroStrategy’s class A common stock, or a combination of cash and shares of MicroStrategy’s class A common stock, at MicroStrategy’s election. Prior to December 15, 2031, the notes will be convertible only upon the occurrence of certain events and during certain periods, and thereafter, at any time until the second scheduled trading day immediately preceding the maturity date. The interest rate, initial conversion rate, and other terms of the notes will be determined at the time of pricing of the offering. MicroStrategy expects that the reference price used to calculate the initial conversion price for the notes will be the U.S. composite volume weighted average price of MicroStrategy’s class A common stock from 9:30 AM through 4:00 PM EDT on the date of pricing.”
See also Microstrategy’s Blog Post on this.
- MicroStrategy: https://assets.contentstack.io/v3/assets/bltb564490bc5201f31/blte1c26caa9b390ffa/666a710e3ab7db76fa18991c/microstrategy-announces-proposed-private-offering-of-500m-of-convertible-senior-notes_06-13-2024.pdf[↩]
