Strategy Sets Terms for Major STRD Preferred Stock Offering Worth Nearly $1 Billion

Strategy (Nasdaq: MSTR/STRK/STRF), the world’s leading Bitcoin Treasury Company, has finalized pricing details for its substantial capital raise through preferred stock issuance. The company will offer 11,764,700 shares of 10.00% Series A Perpetual Stride Preferred Stock at $85.00 per share on June 5, 2025, with settlement scheduled for June 10, 2025.

Capital Raise Details and Use of Proceeds

The preferred offering is expected to generate approximately $979.7 million in net proceeds for Strategy after accounting for underwriting fees and related expenses. These funds will support the company’s strategic objectives, with primary allocation toward Bitcoin acquisitions and operational working capital requirements. This financing structure reflects Strategy’s commitment to strengthening its Bitcoin Treasury position while maintaining operational flexibility.

The STRD Stock pricing represents a carefully calibrated approach to raising capital while preserving existing shareholder value. Underwriters including Barclays, Morgan Stanley, Moelis & Company, and TD Securities are managing this institutional offering, with additional co-managers including The Benchmark Company and Clear Street facilitating distribution.

Understanding the STRD Preferred Stock Terms

Dividend Structure

Holders of STRD Stock will receive non-cumulative dividends at an annual rate of 10.00% on the stated amount, subject to board declaration and fund availability. Unlike cumulative preferred shares, undeclared or unpaid dividends will not accrue for future payment—if the board chooses not to declare a dividend in any quarter, shareholders receive nothing for that period and have no claim to recover it later.

Quarterly dividend payments, when declared, will occur on March 31, June 30, September 30, and December 31 annually, beginning September 30, 2025. This structure provides regular income potential while maintaining flexibility for the company’s cash flow management during various market conditions.

Redemption and Repurchase Rights

Strategy retains redemption flexibility through two primary mechanisms:

Standard Redemption: The company may redeem all outstanding STRD Stock (though not partial amounts) if shares fall below 25% of the original issuance volume across all offerings. This provision allows Strategy to manage capital structure efficiently if the preferred class becomes less significant.

Tax Event Redemption: Additional redemption rights activate upon the occurrence of specific tax-related events, providing regulatory protection for the company.

When redemption occurs, shareholders receive the liquidation preference value plus any declared but unpaid dividends as of the redemption date. Undeclared dividends are excluded from redemption payments.

Fundamental Change Protection

In the event of a “fundamental change” as defined in the certificate of designations, STRD shareholders gain the right to require Strategy to repurchase their shares at a price equal to the stated amount plus accrued declared dividends. This provision protects preferred shareholders during significant corporate transactions.

Dynamic Liquidation Preference Mechanism

The STRD Stock includes a sophisticated liquidation preference structure that adjusts dynamically. The initial stated amount is $100 per share, but the liquidation preference adjusts daily based on trading activity and market prices.

Each business day after issuance, the liquidation preference resets to the highest of three calculations:

1. The fixed stated amount of $100 per share
2. The closing price of STRD Stock from the previous trading day (if any STRD shares were issued during the current or prior ten trading days)
3. The ten-day trailing average of closing prices for STRD Stock

This mechanism ensures that the liquidation preference generally increases when the stock trades above par value, providing a built-in floor that rises with market performance. The adjustment occurs continuously throughout each trading day as new transactions settle.

Company Background and Bitcoin Treasury Strategy

Strategy operates as the world’s first and largest Bitcoin Treasury Company. The organization has made the strategic decision to adopt Bitcoin as its primary treasury reserve asset, fundamentally differentiating it from traditional corporate finance approaches.

Through coordinated use of equity financings, debt instruments, and operational cash flows, Strategy systematically accumulates Bitcoin while actively advocating for its recognition as digital capital. This Treasury strategy framework enables the company to offer multiple security types—both equity and fixed-income instruments—providing investors with varying degrees of economic exposure to Bitcoin price movements.

Beyond Bitcoin operations, Strategy maintains industry-leading artificial intelligence-powered enterprise analytics software capabilities. The company leverages these technical competencies to explore emerging Bitcoin applications and advance its “Intelligence Everywhere” vision, integrating sophisticated analytics with digital asset development expertise.

Regulatory Framework and Offering Details

This preferred stock offering operates under a shelf registration statement filed with the Securities and Exchange Commission (SEC). All offering materials, including the prospectus supplement and preliminary documentation, are available through SEC.gov or directly from managing underwriters.

The offering is exclusively available through official prospectus documentation and is subject to standard closing conditions. The transaction constitutes neither an offer to sell nor a solicitation to buy in jurisdictions where such activities would violate securities laws prior to proper registration.

Forward-Looking Considerations

Strategy’s estimates regarding net proceeds and anticipated use of capital represent forward-looking projections subject to market conditions and completion uncertainties. The actual timing and terms of settlement depend on satisfaction of customary closing conditions. Investors should review the company’s SEC filings, including the May 5, 2025 Quarterly Report on Form 10-Q, for comprehensive risk factor discussions and additional context.