MicroStrategy (NASDAQ:MSTR) Issues 8.00% Series A Perpetual Strike Preferred Stock in Recent Offering

On February 5, 2025, MicroStrategy Incorporated (MicroStrategy) announced the issuance of 7,300,000 shares of a new class of its capital stock, denoted as “8.00% Series A Perpetual Strike Preferred Stock.” This issuance took place through a public offering registered under the Securities Act of 1933. In conjunction with this issuance, MicroStrategy filed a Certificate of Designations with the Secretary of State of Delaware, outlining the terms of the perpetual strike preferred stock.

The 8.00% Series A Perpetual Strike Preferred Stock has a par value of $0.001 per share and a liquidation preference of $100 per share. It holds seniority over MicroStrategy’s Class A common stock and Class B common stock concerning dividend payments and asset distribution in the event of liquidation, dissolution, or winding up.

Accumulating dividends at a rate of 8.00% per annum on the liquidation preference, the perpetual strike preferred stock’s Regular Dividends will be paid quarterly in arrears. MicroStrategy has the option to pay these declared dividends in cash, Class A common stock shares, or a combination of both. Shares of Class A common stock issued for dividend payments will be valued at 95% of the average price per share three trading days before the dividend payment date.

In circumstances where Regular Dividends are not fully paid, Compounded Dividends will accrue quarterly until settled. Holders of the perpetual strike preferred stock have conversion rights to convert their shares into Class A common stock. MicroStrategy reserves the right to redeem all outstanding perpetual strike preferred stock either through Optional Redemption or in response to specific events such as a Tax Redemption or Fundamental Change.

Moreover, holders have voting rights on specific matters but not on an as-converted basis with Class A common stockholders. Furthermore, failure to meet dividend payment requirements can lead to an increase in the number of directors and additional stockholder rights.

The full details of the Certificate of Designations and terms of the perpetual strike preferred stock are included in exhibits accompanying the Current Report on Form 8-K filed by MicroStrategy.

Incorporating this material state change into its structure, MicroStrategy aims to navigate financial landscapes adeptly, offering stakeholders a range of potential avenues for value creation and risk management.

This article was generated by an automated content engine and was reviewed by a human editor prior to publication. For additional information, read MicroStrategy’s 8K filing here.

About MicroStrategy

MicroStrategy Incorporated provides artificial intelligence-powered enterprise analytics software and services in the United States, Europe, the Middle East, Africa, and internationally. It offers MicroStrategy ONE, which provides non-technical users with the ability to directly access novel and actionable insights for decision-making; and MicroStrategy Cloud for Government service, which offers always-on threat monitoring that meets the rigorous technical and regulatory needs of governments and financial institutions.