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TYSONS CORNER, VA - MicroStrategy Incorporated (NASDAQ:MSTR), a prominent business intelligence firm, disclosed the pricing details for its recent offering of perpetual strike preferred stock on Monday. The company has priced the offering at $80.00 per share, with the sale of 7,300,000 shares of its 8.00% Series A Perpetual Strike Preferred Stock.
The transaction is slated to conclude on February 5, 2025, assuming standard closing conditions are met. MicroStrategy anticipates netting approximately $563.4 million from this offering, after accounting for underwriting discounts, commissions, and estimated offering expenses. The firm has expressed intentions to allocate the proceeds towards general corporate purposes, which include purchasing bitcoin and bolstering working capital.
Investors in the perpetual strike preferred stock are promised a liquidation preference of $100 per share and will accrue dividends at an annual rate of 8.00%. MicroStrategy’s board of directors will declare these dividends quarterly in arrears, with the first payment expected on March 31, 2025. Dividends may be paid in cash, shares of MicroStrategy’s class A common stock, or a combination thereof, as determined by the company.
Additionally, holders of the perpetual strike preferred stock will be granted the option to convert their shares into MicroStrategy’s class A common stock at an initial rate of 0.1000 shares of common stock per share of preferred stock, equating to an initial conversion price of $1,000.00 per share of common stock. This conversion rate is subject to adjustments under certain conditions.
MicroStrategy also reserves the right to redeem all shares of the perpetual strike preferred stock, provided the aggregate liquidation preference of outstanding shares falls below 25% of the total issued in the offering or in specific tax-related scenarios. Redemption prices will either match the liquidation preference or, in tax event circumstances, the greater of the liquidation preference or an average of the last reported sale prices over a set period preceding the redemption notice, in addition to any accumulated unpaid dividends.
This financial move is based on a press release statement by MicroStrategy.
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