MicroStrategy will hold a shareholders' meeting to seek approval for raising funds to buy more BTC

MicroStrategy is about to hold a special shareholder meeting to expand its stock issuance plan and buy more BTC. The software development company, which currently holds the most BTC among enterprises, proposes to increase the shares of its Class A common stock and preferred stock to better execute its BTC strategy.

According to the filing submitted by MicroStrategy to the U.S. Securities and Exchange Commission (SEC) on December 23, the company is seeking authorization to increase the issuance of both Class A common stock and preferred stock, in order to be able to issue more shares in the future if necessary.

The first amendment seeks to increase the authorized issuance of Class A common stock from 330 million shares to 10.33 billion shares, while the purpose of the second amendment is to increase the authorized issuance of preferred stock from 5 million shares to 1.005 billion shares.

Behind these two proposals is MicroStrategy's '21/21 plan'. The plan, announced in October, describes the company's plan to purchase an additional $42 billion worth of BTC over the next three years. The plan includes raising $21 billion through the issuance of stocks and an additional $21 billion through the issuance of fixed income securities.

In addition, the power of attorney also detailed the company's other proposals, including a new equity incentive plan that will automatically grant equity rewards to new directors.

According to the document proposed by MicroStrategy: "Proposals 1 and 2 of this special meeting request an increase in the authorized shares of the company's capital stock to support further implementation of our 21/21 plan and broader future capital market activities, as well as other corporate purposes."

MicroStrategy has been regularly buying BTC since 2020, but has increased its purchases since announcing the plan in October. In December alone, the company bought 42,162 BTC, with a market value of over $4 billion at the current price.

At the end of October, MicroStrategy announced that the company's BTC yield was 17.8%, and the company's plan is to achieve an annual yield of 6% to 10% between 2025 and 2027. Subsequently, the company will raise $13 billion through the issuance of stocks, and raise $3 billion through the issuance of convertible bonds.

The company's documents state: "The execution speed of our 21/21 plan is significantly faster than originally expected."

As of December 22nd, MicroStrategy and its subsidiaries collectively hold approximately 444,262 BTC, worth about $43.53 billion. The total cost of acquiring these BTC is $27.7 billion, which represents an average purchase price of $62,257 per BTC.

Although the news of MicroStrategy's purchase of BTC usually drives the company's stock price up, however, the stock price dropped by 8.78% on Monday and rebounded by 7.8% to $358.18 per share on Tuesday, still a decrease of 11% over the past month. Nevertheless, the stock has surged more than 400% in the past year, mainly due to its BTC strategy.

The specific date of the special shareholders' meeting for voting on this proposal has not yet been announced, but it is expected to be held in 2025. The company's next earnings report is scheduled to be released on February 2, 2025.

"MicroStrategy will hold a shareholders' meeting to seek approval for additional BTC purchases" This article was first published in "Blocklike".