Following the announcement of a new $150 million follow-on offering of its Variable Rate Series A Perpetual Preferred Stock, Strive, Inc. (NASDAQ:SATA) experienced a 2.7% decline in its stock price during after-hours trading on Wednesday. The company disclosed plans to utilize the funds from this issuance, together with existing cash resources and potential proceeds gained from terminating current capped call transactions, to repay convertible notes and outstanding debt obligations.
This financial maneuver is part of Strive's strategy to revert to a model centered exclusively on perpetual preferred stock amplification. Beyond debt repayment, the company indicated that some of the raised capital will be allocated to purchasing bitcoin and related financial products, alongside funding working capital and general corporate requirements.
Moreover, Strive revealed ongoing negotiations with holders of Semler Convertible Notes to facilitate an exchange of these notes for shares of SATA stock. Outcomes from these discussions may influence the aggregate amount raised through the follow-on offering, possibly leading to a reduction.
The offered SATA preferred stock carries an annual dividend rate of 12.25%, payable monthly based on a $100 stated value per share. Dividends commence on February 15, 2026, subject to declaration. The company retains the option to modify the dividend rate within stipulated constraints.
In conjunction with this issuance, Strive plans to bolster its dividend reserve fund to sufficiently cover twelve months of dividend obligations at the stated rate.
Barclays and Cantor Fitzgerald are acting as joint book-running managers for the transaction, with Clear Street serving as co-manager.