DeFi Development Corp. has priced its Variable Rate Series C Perpetual Preferred Stock offering at $9 per share, according to an updated prospectus filed with the U.S. Securities and Exchange Commission.
The Solana treasury company plans to sell 2.2 million shares of the preferred security, known as CHAD Stock. The offering is expected to generate $19.8 million in gross proceeds before underwriting commissions and other expenses.
The final terms update DeFi Development’s Aug. 31 announcement, which described a proposed offering of up to $20 million without specifying the share count or offering price.
R.F. Lafferty & Co. is the sole book-running manager. The underwriter also received a 30-day option to purchase an additional 330,000 shares at the public offering price, less commissions. If fully exercised, the option would increase the offering to 2.53 million shares and raise up to $22.77 million in gross proceeds.
CHAD Stock carries an initial 13% dividend rate
Each CHAD share has a $10 stated amount and an initial liquidation preference of $10, although investors in the offering will pay $9 per share.
The initial annual dividend rate is 13%, calculated on the $10 stated amount. If that rate remains unchanged, each share would generate $1.30 in annual dividends.
At the $9 offering price, the initial dividend rate represents an effective annual yield of approximately 14.44%. That figure is based on the starting dividend and does not guarantee that investors will receive the same yield over time.
The dividend rate is variable. DeFi Development’s board may review and adjust it at least monthly based on interest rates, CHAD’s trading price, comparable yields, liquidity requirements and other factors.
The company may lower the rate, although the prospectus limits any monthly reduction to 50 basis points from the previous month. The filing also warns that management could eventually set the rate below those of comparable securities.
The first dividend is scheduled for Oct. 1 and will cover the period from issuance through Sept. 30. After that payment, dividends will be payable on each business day, but only “when, as and if declared” by the board and when legally available funds exist.
Dividend reserve covers the first year at 13%
When the offering closes, DeFi Development intends to deposit $1.30 for each issued share into a separate dividend account. Based on 2.2 million shares, the initial reserve would total approximately $2.86 million.
The reserve represents 12 months of payments calculated at the initial 13% rate. DeFi Development said it would fund the account with existing cash, financial instruments or digital assets rather than relying solely on the offering proceeds.
However, the prospectus states that the company is not contractually required to increase the reserve if the dividend rate rises above 13% or if additional CHAD shares are issued.
Assets in the account could also remain available to creditors during insolvency or bankruptcy. The reserve provides a designated funding source but does not constitute an independent guarantee.
CHAD is a perpetual security with no maturity date. Holders generally cannot demand repayment except after certain qualifying corporate events. The shares have limited voting rights and rank below the company’s current and future debt.
DeFi Development may redeem CHAD for $11 per share, plus accumulated unpaid dividends, after the security is listed on Nasdaq. Separate redemption provisions apply following a tax event or if the number of outstanding shares falls below 25% of all CHAD shares historically issued.
DeFi Development may use proceeds to acquire SOL
The company plans to use the net proceeds for general corporate purposes. Potential uses include working capital, Solana purchases, other digital asset investments, acquisitions and strategic initiatives.
No fixed portion of the proceeds has been allocated to SOL. Investors therefore should not treat the full $19.8 million offering as a confirmed Solana purchase.
DeFi Development recently acquired approximately 19,000 SOL at an average price of $98.14. As previously reported, the purchase expanded its treasury to roughly 2.33 million SOL and SOL-equivalent assets.
The company has not provided a current breakdown separating native SOL from liquid staking tokens and other SOL-denominated positions. It stakes assets through its own validators and external validators to earn network rewards and fees.
The SEC filing warns that any proceeds invested in SOL would remain exposed to price volatility. It also states that management has broad discretion and may allocate the funds differently from its current plans.
CHAD seeks Nasdaq listing as DFDV gains
DeFi Development has applied to list the preferred stock on the Nasdaq Capital Market under the ticker CHAD. Trading is expected to begin after the initial issuance, although Nasdaq approval remains pending.
The company also intends to establish an at-the-market program for additional CHAD sales after the listing. The terms have not been finalized, and future issuance could dilute existing holders’ rights or put pressure on the security’s market price.
DFDV common stock closed Aug. 31 at approximately $5.38, up 7.8% during the session. The CHAD announcement was published at 5:45 p.m. Eastern Time, after regular trading ended, so the intraday gain cannot be attributed to the offering.
The stock opened near $4.90 and traded between approximately $4.84 and $5.52. A verified regular-session reaction to the final CHAD terms will not be available until U.S. markets reopen.
The next confirmed events are the offering’s closing, Nasdaq’s listing decision and the first dividend payment on Oct. 1. Any subsequent SOL acquisition will require a separate company disclosure before it can be treated as completed.
