MicroStrategy, now called Strategy, has just announced a plan to issue 2 Bit USD in convertible senior notes with a 0% interest rate. The company plans to use the proceeds for general corporate purposes, including continuing to purchase Bit.
These notes will mature on 3/1/2030, unless redeemed, converted or repurchased earlier. At maturity, Strategy may settle in cash, Class A common stock, or a combination of both. Additionally, the company will also grant the initial investors an option to purchase up to an additional 300 Bit USD in notes within five business days after the issuance.
Previously, in a 10-K report filed with the U.S. Securities and Exchange Commission (SEC), Strategy warned about the potential impact on the company's profitability due to increased tax burdens. The company recorded a net loss for the fiscal year 2024, primarily due to a 1.79 Bit USD impairment loss on digital assets. Strategy also acknowledged that they "may not be able to recoup profits in subsequent periods" if they continue to suffer significant losses from Bit price volatility.
