Strategy (MSTR) Enters Sales Agreement for Up to $21 Billion of 8.00% Series A Perpetual Strike Preferred Stock

Strategy (NASDAQ: MSTR) disclosed:

We have entered into a Sales Agreement (the “Sales Agreement”) with TD Securities (USA) LLC, Barclays Capital Inc., The Benchmark Company, LLC, BTIG, LLC, Canaccord Genuity LLC, Cantor Fitzgerald & Co., Compass Point Research & Trading, LLC, H.C. Wainwright & Co., LLC, Keefe, Bruyette & Woods, Inc., Mizuho Securities USA LLC, Santander US Capital Markets LLC, and SG Americas Securities, LLC (collectively, the “Agents”), dated March 10, 2025, relating to the sale of shares of our 8.00% Series A Perpetual Strike Preferred Stock, which we refer to as our “perpetual strike preferred stock,” offered by this prospectus supplement. In accordance with the terms of the Sales Agreement, under this prospectus supplement, we may offer and sell shares of our perpetual strike preferred stock having an aggregate offering price of up to $21,000,000,000 from time to time through one or more of the Agents, acting as our sales agents.

Our perpetual strike preferred stock is listed on The Nasdaq Global Select Market under the trading symbol “STRK.” On March 7, 2025, the last reported sale price of our perpetual strike preferred stock as reported on The Nasdaq Global Select Market was $92.40 per share, and the last reported sale price of our class A common stock as reported on The Nasdaq Global Select Market was $287.18 per share.

Sales of our perpetual strike preferred stock, if any, under this prospectus supplement may be made by any method that is deemed an “at the market offering” as defined in Rule 415(a)(4) under the Securities Act of 1933, as amended (the “Securities Act”) or any other method permitted by law, which may include negotiated transactions or block trades. Our perpetual strike preferred stock will be offered and sold through the Agents over a period of time and from time to time. None of the Agents are required to sell any specific amount, but each will act as our sales agent using commercially reasonable efforts, consistent with its normal trading and sales practices, on mutually agreed terms between the Agents and us. There is no arrangement for funds to be received in an escrow, trust or similar arrangement.

The compensation to the Agents for sales of perpetual strike preferred stock sold pursuant to the Sales Agreement will be up to 2.0% of the gross proceeds of any shares of perpetual strike preferred stock sold under the Sales Agreement. In connection with the sale of the perpetual strike preferred stock on our behalf, the selling Agents may be deemed to be “underwriters” within the meaning of the Securities Act and the compensation of the Agents may be deemed to be underwriting commissions or discounts. We have also agreed to provide indemnification and contribution to the Agents with respect to certain liabilities, including civil liabilities under the Securities Act or Securities Exchange Act of 1934, as amended (the “Exchange Act”).

PERPETUAL STRIKE PREFERRED STOCK

The up to $21,000,000,000 of shares of perpetual strike preferred stock that we may offer and sell under this prospectus supplement and the accompanying prospectus constitutes a further issuance of the 7,300,000 shares of perpetual strike preferred stock outstanding as of the date of this prospectus supplement. Other than the issue date, and in the case of perpetual strike preferred stock issued after March 15, 2025, the first regular dividend date, perpetual strike preferred stock that we may offer and sell under this prospectus supplement and the accompanying prospectus will have terms identical to, will have the same CUSIP number as, and will vote together with, the perpetual strike preferred stock outstanding as of the date of this prospectus supplement immediately upon issuance.

The perpetual strike preferred stock accumulates cumulative dividends, which we refer to as “regular dividends,” at a rate per annum equal to 8.00% on the liquidation preference thereof, which is $100 per share of perpetual strike preferred stock. Regular dividends on the perpetual strike preferred stock are payable when, as and if declared by our board of directors, out of funds legally available for their payment to the extent paid in cash, quarterly in arrears on March 31, June 30, September 30 and December 31 of each year, beginning on March 31, 2025. Declared regular dividends on the perpetual strike preferred stock are payable, at our election, in cash, shares of our class A common stock or a combination of cash and shares of our class A common stock, in the manner, and subject to the provisions, described in this prospectus supplement.

Subject to certain limitations, preferred stockholders have the right to convert some or all of their shares of perpetual strike preferred stock on any business day into shares of our class A common stock (together, if applicable, with cash in lieu of any fractional share of class A common stock) at the then-applicable conversion rate. The initial conversion rate is 0.1000 shares of class A common stock per share of perpetual strike preferred stock, which represents an initial conversion price of $1,000.00 per share of class A common stock, and is subject to adjustment as described in this prospectus supplement.

We have the right, at our election, to redeem all, and not less than all, of the perpetual strike preferred stock, at any time, for cash if the total aggregate liquidation preference of all perpetual strike preferred stock then outstanding is less than $182,500,000 (which is equal to 25% of the aggregate liquidation preference of the perpetual strike preferred stock issued on February 5, 2025). In addition, we have the right to redeem all, but not less than all, of the perpetual strike preferred stock if a “tax event” (as defined in this prospectus supplement) occurs. The redemption price for any perpetual strike preferred stock to be redeemed will be a cash amount equal to the liquidation preference of the perpetual strike preferred stock to be redeemed (or, in the case of a redemption in connection with a tax event, the greater of (1) the liquidation preference of the perpetual strike preferred stock to be redeemed; and (2) the average of the last reported sale prices per share of perpetual strike preferred stock for the five consecutive trading days ending on, and including, the trading day immediately before the date on which we send the related redemption notice), plus accumulated and unpaid regular dividends to, but excluding, the redemption date.

If a “fundamental change” (as defined in this prospectus supplement) occurs, then, except as described in this prospectus supplement, preferred stockholders will have the right (which we refer to as the “fundamental change repurchase right”) to require us to repurchase some or all of their shares of perpetual strike preferred stock at a cash repurchase price equal to the liquidation preference of the perpetual strike preferred stock to be repurchased, plus accumulated and unpaid regular dividends, if any, to, but excluding the fundamental change repurchase date.

Our business and an investment in the perpetual strike preferred stock involve significant risks. These risks are described under the caption “Risk Factors” beginning on page S-17 of this prospectus supplement and in the documents incorporated by reference into this prospectus supplement.

Neither the Securities and Exchange Commission nor any state or foreign securities commission or regulatory authority has approved or disapproved of the perpetual strike preferred stock or the shares of our class A common stock issuable in respect thereof or passed upon the adequacy or accuracy of this prospectus supplement or the accompanying prospectus. Any representation to the contrary is a criminal offense.

We expect to deliver the perpetual strike preferred stock in book-entry form only through the facilities of The Depository Trust Company on or about the next trading day following the date of purchase.

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