Strategy proposes daily dividends for STRC, STRD, STRF and STRK preferred stocks

Bitcoin treasury company Strategy is seeking shareholder approval to pay daily dividends on four of its U.S.-listed preferred stocks, including STRC, which moved from monthly to semi-monthly payments less than three months ago.

Strategy's board approved the proposal on Sept. 24, according to an 8-K filing with the Securities and Exchange Commission on Friday. Under the proposed terms, STRC, STRD, STRF and STRK would have a dividend record date every calendar day, including weekends and holidays. Any dividend declared for that date would be paid on the next business day, the firm said.

The proposal does not change the dividend rates on the four securities or increase Strategy's total regular dividend obligations. STRC would be the first to switch, with an initial record date of Nov. 1 and payment the following day if shareholders approve the amendments. STRF, STRD, and STRK would follow in January.

"The proposed changes aim to support price stability, liquidity, and demand," Strategy co-founder and Executive Chairman Michael Saylor said on X.

Strategy's 'Digital Credit' platform

Strategy shareholders previously approved moving STRC from monthly to semi-monthly dividends in June. CEO Phong Le said at the time that paying twice a month was intended to stabilize its price, improve liquidity, and give holders a faster opportunity to reinvest. STRC is a variable-rate perpetual preferred stock designed to trade around a $100 par value. It closed down 0.6% at $98.31 on Thursday, per TradingView, having previously plunged below $75 in June.

Following that drop, Strategy introduced a $1 billion repurchase program for its preferred stock, initially prioritizing STRC. It then doubled the authorization to $2 billion earlier this month.

The four securities covered by the latest proposal form the core of what Strategy calls its "Digital Credit" platform. The company said more frequent payments could make the preferreds more attractive and support its ability to raise preferred equity capital for its bitcoin (BTC) treasury strategy. 

"Strengthening our preferred securities would create a competitive advantage for Strategy and increased demand could drive amplification and bitcoin per share," the firm said in a separate statement.

Strategy has scheduled a virtual special meeting for Oct. 28. Approval requires a majority of the voting power of its outstanding common stock, according to its preliminary proxy statement filing. Holders of STRC, STRD, STRF and STRK do not vote on the proposal. If approved, the amendments would take effect after Strategy files the amended certificates of designation in Delaware.