Strategy Inc has announced its intention to conduct a registered initial public offering of 3,500,000 shares of its 10.00% Series A Perpetual Stream Preferred Stock (STRE Stock), with net proceeds designated for general corporate purposes, including the acquisition of bitcoin, and for working capital.
The STRE Stock is designed to accumulate cumulative dividends at an annual rate of 10.00% on its stated amount, which is €100 per share. These regular dividends, payable solely in cash, are expected to be declared quarterly in arrears on March 31, June 30, September 30, and December 31 each year, commencing on December 31, 2025.
Should any accumulated regular dividend on the STRE Stock not be paid on its scheduled date, additional compounded dividends will accrue on the unpaid amount, compounding quarterly. The initial compounded dividend rate will be 10% per annum plus 100 basis points, escalating by 100 basis points annually for each subsequent regular dividend period until paid, up to a maximum rate of 18% per annum.
In the event Strategy Inc fails to declare a regular dividend by a given record date, this will trigger a notice of deferral. Following such a notice, and unless prohibited by the terms of existing senior stock or indebtedness, Strategy Inc will aim to sell STRK Stock, STRD Stock, class A common stock, or other junior stock within 60 days. The goal is to generate proceeds sufficient to cover any deferred dividends and compounded dividends, subject to the full payment of accumulated dividends on Strategy’s STRF Stock and STRC Stock, and any other dividend senior stock.
Strategy Inc retains the right to redeem all, but not less than all, of the STRE Stock under specific conditions. These include when the total outstanding STRE Stock falls below 25% of the shares originally issued in this and any future offerings, or upon the occurrence of certain tax events. The redemption price for any STRE Stock will be a cash amount equivalent to its liquidation preference as of the business day prior to the redemption notice, plus any accumulated and unpaid regular dividends up to the redemption date.
Furthermore, if an event constituting a “fundamental change” occurs, holders of STRE Stock may require Strategy Inc to repurchase some or all of their shares. The repurchase price would be a cash amount equal to the stated amount of the STRE Stock plus any accumulated and unpaid regular dividends, excluding those accumulated on the fundamental change repurchase date.
The liquidation preference of the STRE Stock will initially be €100 per share. This preference will be adjusted daily to be the greatest of (i) the stated amount per share, (ii) the last reported sale price per share on the trading day immediately preceding any business day during which Strategy Inc executes a sale transaction of STRE Stock, or (iii) the arithmetic average of the last reported sale prices per share for the ten consecutive trading days preceding such business day (or fewer if less time has elapsed since the initial issue date).
Barclays Bank PLC, Morgan Stanley & Co. International plc, Moelis & Company LLC, SG Americas Securities, LLC, TD Securities (USA) LLC, Canaccord Genuity Limited, and StoneX Financial Inc. are serving as joint book-running managers for this offering.
The offering is being made pursuant to an effective shelf registration statement filed with the U.
S. Securities and Exchange Commission (SEC). A prospectus supplement and accompanying prospectus are available on the SEC’s website.
Prospective investors in the European Economic Area (EEA) and the United Kingdom (U.
K.) are subject to specific restrictions. In both regions, this communication is intended only for “qualified investors” and certain other professional entities, not for retail investors, due to regulations such as the Prospectus Regulation, MiFID II, the Insurance Distribution Directive, and the PRIIPs Regulation. No key information document required for retail investors has been prepared, making offering or selling the STRE Stock to retail investors in the EEA or U.
K. potentially unlawful.
Strategy Inc (Nasdaq: STRF/STRC/STRK/STRD/MSTR) positions itself as the world’s first and largest Bitcoin Treasury Company. As a publicly traded entity, it has adopted Bitcoin as its primary treasury reserve asset, leveraging proceeds from equity and debt financings, along with cash flows from operations, to strategically accumulate Bitcoin. The company advocates for Bitcoin’s role as digital capital, designing its treasury strategy to offer investors varying degrees of economic exposure to Bitcoin through a range of securities. In addition to its Bitcoin strategy, Strategy Inc provides AI-powered enterprise analytics software, aligning with its vision of “Intelligence Everywhere.” The company integrates its analytics expertise with its commitment to digital asset growth through innovation in Bitcoin applications.
