So, another $3B bitcoin buy, at around $100k a coin?

The net proceeds from the sale of the notes were approximately $2.97 billion, after deducting the initial purchasers’ discounts and commissions and estimated offering expenses payable by MicroStrategy.

NEWS >

MicroStrategy Completes $3 Billion Offering of Convertible Senior Notes Due 2029 at 0% Coupon and 55% Conversion Premium

Press Release  â€¢  November 21, 2024

The notes were sold in a private offering only to persons reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended (the “Securities Act”).

The notes will mature on December 1, 2029

Now is 2024, will mature on Dec 1, 2029– implied strike price at $672

ERIC KIM ANALYSIS

So this is really fascinating because when this was announced, MSTR was around $499, $500, $520s a share ,,, and so you’re kind of getting like a $2B , multiplied by 18%-20% gain (100% guaranteed for the institutional investors with Huuuuge bucks, … almost a 0% risk free option, because Dec 1, 2029,,, $672 a share ,,, of course, 5 years from now MSTR is like 1000% guaranteed to be like maybe $15,000 a share.

Simplify

Subject to certain conditions, on or after December 4, 2026, MicroStrategy may redeem for cash all or any portion of the notes at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid special interest, if any, to, but excluding, the redemption date, if the last reported sale price of MicroStrategy’s class A common stock has been at least 130% of the conversion price then in effect for a specified period of time ending on the trading day immediately before the date the notice of redemption is sent.

Starting on or after December 4, 2026, MicroStrategy can redeem the notes for cash under certain conditions. The redemption price will be the full principal amount of the notes, plus any unpaid special interest up to the redemption date. This option is available only if the price of MicroStrategy’s class A common stock has been at least 130% of the current conversion price for a specified period before the redemption notice is issued.

4 year old

Starting December 4, 2026, if MicroStrategy’s stock price gets really high (130% of a set number), they can pay back the notes in full with any extra interest they owe, as long as they give a heads-up first.

…

So if MSTR gets 130% of the set number, can pay back the notes in full with extra interest they owe, as long as they give a heads up!

Conversion rates, premium

The conversion rate for the notes is initially 1.4872 shares of MicroStrategy’s class A common stock per $1,000 principal amount of notes, which is equivalent to an initial conversion price of approximately $672.40 per share. This represents a premium of approximately 55% over the U.S. composite volume weighted average price of MicroStrategy’s class A common stock from 1:30 p.m. through 4:00 p.m. Eastern Standard Time on November 19, 2024, which was $433.7997. The conversion rate is subject to adjustment upon the occurrence of certain events.

Premium of 55% ,,, guaranteed, on November 19 2024, $433.7997 a share, which is $672.40 a share.