MicroStrategy Prices Private Offering Of Convertible Senior Notes

(RTTNews) - MicroStrategy Inc. (MSTR), a software company, Wednesday announced the pricing of a private offering of $700 million of Convertible Senior Notes due March 15, 2030.

Shares of the company are trading up around 6 percent in pre-market activity.

MicroStrategy has granted initial purchasers an option to purchase within 13 days beginning on the date the notes first issued to purchase up to additional $100 million principal amount of the notes.

The offering was upsized to $700 million from the previous offering of $600 million.

The Notes are unsecured, senior obligations of the company with an interest rate of 0.625% per annum, payable semi-annually in arrears on March 15 and September 15. The first semi-annual arrear will begin on September 15, 2024.

The Notes will be convertible to cash, class A stock of the company, or a combination of the two at the company's election.

Prior to September 15, 2029 the notes will be convertible contingent to certain events and during certain periods, after which they can be converted any time until the second scheduled trading day immediately preceding the maturity date.

The conversion rate for the Notes will be 0.6677 shares of Class A stock per $1,000 principal amount of notes initially. This is a premium of around 42.5 percent over the last reported price sale price of $1,051.01 per share of the Class A stock.

The company estimates the net proceeds from the offering to be around $684.3 million and it intends to use the proceeds to acquire additional bitcoin and for general corporate purposes.

The offering is expected to close on March 8.

In premarket activity, MicroStrategy shares are trading at $1111, up 5.71% on Nasdaq.