Strategy Launches Second Series A Preferred Stock Offering STRF at $85 Each
Strategy (MSTR) has introduced a second Series A perpetual preferred stock, Strife (STRF), to enhance its capital market instruments. Key points include:
- 8.5 million shares of STRF priced at $85 each, aiming to raise $711.2 million for bitcoin purchases.
- The previous preferred stock issuance, Strike (STRK), raised $563 million.
- STRF offers a 10% annual dividend on a $100 stated amount, with quarterly cash payments.
- If dividends are missed, they compound at an additional 1% per year up to an 18% maximum rate.
- STRF may be redeemed if fewer than 25% of the original shares remain or under specific tax events.
- In case of a fundamental change, shareholders can compel repurchase at the stated amount plus accrued dividends.
Comparison with STRK:
- STRK provides an 8% annual dividend and allows conversion to common stock at a 10:1 ratio if its price reaches $1,000.
- STRF is focused on income and capital stability, while STRK offers potential for capital appreciation.
Strategy plans to fund dividend payments through operational cash flow, convertible debt offerings, and ATM share sales. It recently purchased 130 BTC and has $3.57 billion in remaining ATM capacity. The company's shares increased over 10%, bringing its total bitcoin holdings to 506,137 BTC.