MicroStrategy Completes $2 Billion Convertible Notes Offering

MicroStrategy Inc., doing business as Strategy, announced on February 21, 2025, that it has closed its previously disclosed private offering of 0% convertible senior notes due 2030. The offering, completed in coordination with Morgan Stanley & Co. LLC acting as representative for the initial purchasers, raised an aggregate principal amount of $2 billion with the option for qualified investors to acquire an additional $300 million in notes within five business days of the initial issuance. Net proceeds from the offering were approximately $1.99 billion after fees and estimated expenses.

According to the filing with the Securities and Exchange Commission, the notes are senior, unsecured obligations that do not bear regular interest and have a principal amount that does not accrete. However, special and additional interest may accrue at a rate not to exceed 0.50% per annum if certain reporting or notice conditions are not met. The notes are scheduled to mature on March 1, 2030, with conversion rights available to noteholders; prior to December 3, 2029, conversion is permitted only upon the occurrence of specified events, while from that date until shortly before maturity, conversion can occur at the holders’ discretion. The initial conversion rate is set at 2.3072 shares of the Company’s Class A common stock per $1,000 of principal, corresponding to an initial conversion price of approximately $433.43 per share.

The offering was executed through a purchase agreement under which the notes were sold to qualified institutional buyers in reliance on Rule 144A of the Securities Act. An indenture agreement with U.S. Bank Trust Company, National Association, serving as trustee, outlines that the notes rank equally with the Company’s existing and future senior unsecured indebtedness and are structurally subordinated to all secured debt. In addition to conversion provisions, the indenture provides for limited redemption rights. Under certain conditions, the Company may opt to redeem all or a portion of the outstanding notes after March 5, 2027, subject to specified trading price conditions. Furthermore, the indenture permits noteholders to require cash repurchases in the event of certain corporate changes, including specified “Fundamental Change” events.

The offering documents make clear that neither the notes nor the underlying shares of Class A common stock to be issued upon conversion have been registered under the Securities Act. Any potential offering or resale in the United States would require registration or an applicable exemption from such requirements.

Proceeds from the offering are intended to be used for general corporate purposes, including the acquisition of bitcoin and for working capital. The filing and the accompanying press release contain various forward-looking statements regarding the future use of proceeds and other strategic matters, which are subject to risks and uncertainties as described in the Company’s public filings.

MicroStrategy’s move underscores its continued efforts to secure financing for its operational and strategic initiatives while maintaining a focus on its Bitcoin treasury strategy.

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.

MicroStrategy Company Profile

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.