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MicroStrategy has unveiled plans for a private offering of $500 million in convertible senior notes due 2032.

Offering Details and Conditions

MicroStrategy is providing initial purchasers an option to buy an additional $75 million in notes within 13 days from issuance. The completion of this offering is subject to favorable market conditions and other variables, with no assurance of its fruition or final terms.

Terms of the Convertible Senior Notes

These notes are unsecured, senior obligations. Interest is payable semi-annually on June 15 and December 15, starting December 15, 2024. The notes mature on June 15, 2032, unless repurchased, redeemed, or converted earlier. From June 20, 2029, MicroStrategy may redeem the notes for cash if at least $75 million remains outstanding. Noteholders can demand repurchase for cash on June 15, 2029.

Conversion Features

The notes can be converted into cash, shares of MicroStrategy’s class A common stock, or a combination thereof, at MicroStrategy’s discretion. Before December 15, 2031, conversion is permitted only upon specific events and during certain periods. After this date, conversion is allowed anytime until two days before maturity. The initial conversion price, interest rate, and other specifics will be determined at pricing. The reference price for the conversion rate is expected to be the U.S. composite volume weighted average price of class A common stock on the pricing date.

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