MARA Holdings, Inc. (NASDAQ: MARA), a global firm focused on leveraging digital asset compute to support the energy transformation, announced the closing on November 20, 2024 of its offering of 0.00% convertible senior notes due 2030.
Mara Holdings confirmed in the update that it has officially finalized a $1 billion issuance of zero-coupon convertible senior notes that are now due March 1, 2030.
The firm intends to use the majority of the proceeds to acquire additional exposure to Bitcoin (BTC).
As explained in the announcement, the notes, which are issued to institutional investors as pert Rule 144A of the Securities Act of 1933, reportedly include a conversion price considerably greater than Mara’s present stock value.
As noted in the update from MARA, the notes may be redeemed under favorable conditions starting in the year 2028.
Around $199 million (appr. 20% of the funds) may be allocated to take care of the expected debt obligations. The remaining funds will aim to support varios investments, business growth and making Bitcoin purchases.
As explained in a release, the aggregate principal amount of the notes sold in the offering was $1 billion, which reportedly “includes $150 million aggregate principal amount of notes issued pursuant to an option to purchase, within a 13-day period beginning on, and including, the date on which the notes were first issued, granted to the initial purchasers under the purchase agreement, which the initial purchasers exercised in full on November 19, 2024 and which additional purchase was completed on November 20, 2024.”
The notes were sold in a private offering to persons “reasonably believed to be qualified institutional buyers in reliance on Rule 144A under the Securities Act of 1933, as amended.”
The net proceeds from the sale of the notes were “approximately $980 million, after deducting the initial purchasers’ discounts and commissions but before estimated offering expenses payable by MARA.”
The notes are “unsecured, senior obligations” of MARA.
The notes will not bear regular interest and the “principal amount of the notes will not accrete.”
MARA may pay special interest, “if any, at its election as the sole remedy for failure to comply with its reporting obligations and under certain other circumstances, each pursuant to the indenture.”
Special interest, if any, on the notes will be “payable semi-annually in arrears on March 1 and September 1 of each year, beginning on March 1, 2025 (if and to the extent that special interest is then payable on the notes).” The notes will mature “on March 1, 2030, unless earlier repurchased, redeemed or converted in accordance with their terms.”
Subject to certain conditions, on or after March 5, 2028, MARA may redeem for cash all or any “portion of the notes at a redemption price equal to 100% of the principal amount of the notes to be redeemed, plus accrued and unpaid special interest, if any, to, but excluding, the redemption date, if the last reported sale price of MARA’s common stock has been at least 130% of the conversion price then in effect for a specified period of time ending on, and including, the trading day immediately before the date MARA provides the notice of redemption.”
The notes are convertible into “cash, shares of MARA’s common stock, or a combination of cash and shares of MARA’s common stock, at MARA’s election.”
Prior to December 1, 2029, the notes are convertible “only upon the occurrence of certain events and during certain periods, and thereafter, at any time until the close of business on the second scheduled trading day immediately preceding the maturity date.”
MARA is a global firm focused on the digital asset compute that develops and deploys technologies to build a sustainable and inclusive future. MARA secures the world’s “preeminent” blockchain ledger and supports the energy transformation by converting “clean, stranded, or otherwise underutilized energy” into economic value.
