Important Disclosures

About Loch

Loch is not a bank, broker-dealer, or registered investment adviser. Credit facilities described on this site are provided by third-party lending partners. This site does not constitute an offer to lend, a solicitation to buy or sell securities, or investment, tax, or legal advice. All credit terms are subject to underwriting and approval.

About STRC

STRC (Strategy's Variable Rate Series A Perpetual Stretch Preferred Stock) is a security. STRC is not a bank deposit, is not FDIC insured, and does not carry bank-account-level protections. Strategy is not a registered money market fund — holders do not benefit from money market fund protections.

Dividends

STRC dividends must be declared by Strategy's board of directors and are not guaranteed. The current rate of 11.5% per annum is subject to monthly adjustment, with a maximum decrease of 25 basis points per month plus any SOFR decline during the prior period. The rate floor is one-month term SOFR and cannot be negative. Past dividend rates are not indicative of future rates.

Strategy expects to fund dividends primarily through additional capital raising, not operating cash flow. There is no assurance that Strategy will declare dividends in any given period.

Tax Treatment

STRC dividends are currently treated as return of capital for U.S. federal income tax purposes, reducing the holder's cost basis rather than being taxed as ordinary income or qualified dividends. This tax treatment may change based on Strategy's earnings and profits or changes in tax law.

Return of capital (ROC) treatment is based on current U.S. federal income tax classification and may vary by jurisdiction. State and local tax treatment may differ. ROC treatment is subject to change based on Strategy's earnings and profits.

Borrowing against securities may have tax implications distinct from selling securities. Nothing on this site constitutes tax advice. Consult a qualified tax advisor for your specific situation.

Collateral & Risk

When STRC shares are pledged as collateral, a UCC control agreement places a lien on the shares. While shares remain in the borrower's brokerage account, they cannot be sold or transferred while pledged. Ownership is retained by the borrower, and dividends continue to be paid to the borrower.

If the value of pledged collateral falls below required maintenance levels, a margin call will be issued. The borrower will have the opportunity to post additional collateral or reduce the outstanding balance. Failure to meet a margin call may result in liquidation of pledged shares by the lender.

Borrowing against securities involves risk, including the potential loss of all pledged collateral.

Illustrative Terms

All credit line amounts, advance rates, interest rates, and other terms referenced on this site are illustrative and subject to individual underwriting, credit approval, and market conditions. The calculator on this site is for informational purposes only and does not constitute an offer, commitment, or guarantee of any credit terms.

Forward-Looking Statements

This site may contain forward-looking statements regarding anticipated credit terms, yield rates, and product features. These statements are based on current expectations and are subject to risks and uncertainties. Actual results may differ materially from those projected. Loch assumes no obligation to update forward-looking statements.