MicroStrategy Successfully Concludes 800 Million ConvertibleNote Offering at 225 Interest Rate for Bitcoin Acquisitions

MicroStrategy, a US-based business intelligence platform that offers cloud-based services and mobile software, has announced a significant development. According to the company’s press release, it has successfully completed a convertible-note offering worth up to $800 million. The notes carry a coupon rate of 2.25% and a conversion premium of 35%.
MicroStrategy Successfully Concludes $800 Million Convertible Note Offering at 2.25% Coupon and 35% Conversion Premium
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June 20, 2024
MicroStrategy Successfully Concludes 2.25% Convertible Note Offering of $800 Million
The platform stated that the total principal amount of the notes offered was approximately $800 million. This amount includes a $100 million aggregate principal amount of notes with a purchase option. The notes were sold through a private offering, targeting eligible institutional purchasers in accordance with Rule 144A of the Securities Act of 1933.
According to MicroStrategy, the notes carry an annual interest rate of approximately 2.25%. They are unsecured and can be paid semi-annually in arrears. Payments can be made on June 15th and December 15th each year, starting from December 15th, 2024.
Notes Can be Paid Semi-Annually on June 15th and December 15th Each Year
Unless they are repurchased, converted, or redeemed earlier, the notes will mature on June 15th, 2032. Note holders may require the platform to repurchase the notes on June 15th, 2029, or on specific events. These events may include a fundamental change as defined in the indenture governing the notes, with a repurchase price equal to 100% of the principal amount of the notes.
Users have the option to convert the notes into cash or Class A stock shares of MicroStrategy. The conversion rate initially stands at 0.4894 shares per $1,000 principal amount. MicroStrategy intends to use the net sale proceeds to purchase more Bitcoin as part of its general corporate objectives.
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