Key Takeaways
Strategy’s Oct. 28 vote needs a majority of all outstanding common voting power, not just votes cast.If approved, STRC pays $1.00 per share across 30 daily dividends in November at a 12% annual rate.Strategy reports Q3 results on Oct. 29, a day after the vote, with 848,517 BTC on its balance sheet.
What’s on the Ballot
The special meeting starts at 10:00 a.m. ET on Oct. 28, with two key agenda points being listed:
Proposal 1 amends the certificates of designation for four perpetual preferred stocks, STRC, STRF, STRK and STRD, so they can carry daily dividend record dates. Proposal 2 simply lets the company adjourn if it needs more time to collect votes. The fifth preferred, STRE, is left out.
Only common stockholders of record on Sept. 25 can vote. Preferred holders, the people who would actually receive the daily payouts, get no say.
Silence Counts as a No
The proxy requires the affirmative vote of holders of “a majority of the voting power of all outstanding Common Stock.” Abstentions and broker non-votes both have “the effect of a vote AGAINST Proposal 1.”
In practice, every retail share sitting idle in a brokerage account works against the plan. Instructions submitted in advance must arrive by 11:59 p.m. ET on Oct. 27.
Michael Saylor gives the proposal a big head start given that he controls 32.9% of total voting power, almost all of it through Class B shares that carry 10 votes apiece. The company still needs roughly another 17 percentage points from everyone else.
What Would a Daily Dividend Look Like?
Strategy’s board has already declared the money on a conditional basis and STRC holders would earn a cash dividend for every day from Nov. 1 through Nov. 30, in amounts of $0.03 or $0.04 per share, totaling $1.00. Each payment lands on the business day after its record date, from Nov. 2 through Dec. 1. Weekends included. On the development, Strategy CEO Phong Le, wrote on X:
“It will be the first global security with calendar day accruals, paving the way for the digital transformation of capital markets,”
That said, if shareholders do not approve the change by 5:00 p.m. ET on Oct. 31, or the amended certificate is not effective by 12:01 a.m. ET on Nov. 1, the daily payouts vanish. In that case, the previously declared Nov. 15 dividend gets paid instead (with holders not being able to collect both).
STRF, STRK and STRD would make their Dec. 31 payments under the old schedule and switch to daily accruals from January 2027.
Why Is Strategy So Fixated on $100?
Management says it will keep recommending STRC’s 12.00% rate “until STRC has demonstrated sustained, healthy trading near $100 per share.” The stock is close but not there yet. It closed at $99.16 on Monday, with no at-the-market (ATM) issuance.
Strategy has been paying hard cash to close that gap and Arkham data shows the company has now bought back $2.05 billion of STRC, including 2,068,459 shares last week at an average of $99.06. That week it bought zero bitcoin, a choice Bitcoin.com News covered when Strategy skipped its buy on Monday.
The logic is simple, i.e. a daily payout makes a preferred feel less like a bond and more like a cash account backed by a bitcoin treasury. A stock that feels like a cash account should trade at par. And a preferred that trades at par is one Strategy can sell again to fund future bitcoin purchases.
What Happens Thursday?
Strategy reports third-quarter results on Oct. 29, with analysts from Citi, Barclays and BTIG joining the live Q&A. The company currently holds 848,517 BTC and $5.1 billion in U.S. dollar assets as of Oct. 25.
The backdrop, however, seems to be quite rough, with bitcoin’s price stuck near $80,000. Still, Strategy’s preferreds have returned 23% to 39%, a track record Saylor will lean on when he takes the stage.
If the vote passes, the first daily STRC record date is Saturday, Nov. 1. If it fails, Strategy gets an awkward earnings call explaining why its own shareholders did not show up. Earlier this month, Bitcoin.com News laid out the full daily dividend plan when it was first announced.
