Company: MSTR
Filing Date: 2025-07-07
Form Type: 8-K
Source: 0000950170-25-094137
Chunk: 70

Company: Strategy Inc
Filing Date: 2025-07-07
Form: 8-K
Item: Item 8.01
Chunk 70
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 Preferred Stock will depend on many factors, including the following:

• our financial condition, including the amount of cash we have on hand;

• the amount of cash, if any, generated by our operations and financing activities (including our ability to raise additional capital from the equity capital markets on favorable terms or at all);

• our anticipated financing needs, including the amounts needed to service our indebtedness or other obligations;

• the degree to which we decide to reinvest any cash generated by our operations or financing activities to fund our future operations;

• the ability of our subsidiaries to distribute funds to us;

• regulatory restrictions on our ability to pay dividends, including under the Delaware General Corporation Law;

• our ability to sell equity securities under new at-the-market offering programs; and

• contractual restrictions on our ability to pay dividends.

In addition, subject to a limited exception, our board of directors or any duly authorized committee thereof may choose not to pay accumulated dividends on our Preferred Stock for any reason. Accordingly, we may pay less than the full amount of dividends on our Preferred Stock. If we fail to declare and pay dividends on any series of our Preferred Stock in full, then the value of that series or our other series of Preferred Stock, as well as our class A common stock, will likely decline.

Provisions contained in the instruments governing our future indebtedness may restrict or prohibit us from paying cash dividends on our Preferred Stock. If the terms of our indebtedness restrict or prohibit us from paying dividends, then we may seek to refinance that indebtedness or seek a waiver that would permit the payment of dividends. However, we may be unable or may choose not to refinance the indebtedness or obtain a waiver.

Under the Delaware General Corporation Law, we may declare dividends on our Preferred Stock only out of our “surplus” (which generally means our total assets less total liabilities, each measured at their fair market values, less statutory capital), or, if there is no surplus, out of our net profits for the current or the immediately preceding fiscal year. We may not have sufficient surplus or net profits to declare and pay dividends on our Preferred Stock in cash.

If we are unable or, if permitted, decide not to pay accumulated dividends on our STRK Stock in cash, then we may, but are not obligated, subject to a limited exception, to elect to pay dividends on our STRK Stock in shares of our class A common stock. However, the payment of dividends in shares of our class A common stock will cause dilution to holders of our