With Bitcoin surpassing $50,000 for the first time this morning, Business intelligence and mobile software firm MicroStrategy has announced it intends to sell bonds and use the net proceeds to “acquire additional bitcoins.”
In the last few weeks, MicroStrategy has been adding more bitcoin to its reserves (here and here most recently), and today unveiled plans to offer $600 million of convertible senior notes due 2027 in a private offering to institutional buyers.
The notes will be unsecured, senior obligations of MicroStrategy and will bear interest payable semi-annually in arrears on February 15 and August 15 of each year, beginning on August 15, 2021.
The notes will mature on February 15, 2027, unless earlier repurchased, redeemed or converted in accordance with their terms. Subject to certain conditions, on or after February 20, 2024, MicroStrategy may redeem for cash all or a portion of the notes. The notes will be convertible into cash, shares of MicroStrategy’s class A common stock, or a combination of cash and shares of MicroStrategy’s class A common stock, at MicroStrategy’s election. Prior to August 15, 2026, the notes will be convertible only upon the occurrence of certain events and during certain periods, and thereafter, at any time until the second scheduled trading day immediately preceding the maturity date. The interest rate, conversion rate, conversion price and certain other terms of the notes will be determined at the time of pricing of the offering.
MicroStrategy intends to use the net proceeds from the sale of the notes to acquire additional bitcoins.