I'm loving the challenge of trying to see how this plays out with MSTR, the preferred share dividends are not guaranteed and are written in a way that skipping them is not a default event. The strike on the convert is now grossly out of the money. The holders of these things may be royally fucked. They have a priority claim on the BTC in a liquidation but that isn't likely to happen, the scenario becomes just a dead money trade at substantially under par. It is trading like participants are sniffing out that the payments are going to be nixed. Just the beginning of it or they would be a good bit lower.
He gave himself a lot of power structuring things the way he did, but it feels like that could also be the undoing as investors realize what a shitty deal holding these preferred is. And how many morons were buying this stuff saying it was just a better savings account. If the price stays low he can't hit the ATM without accelerated dilution, if he sells more preferred it's now going to be well below par and that just delays the problem.
He is confident because the divy size compared to the BTC pile is so small and it is, but the BTC pile isn't how he pays the dividend it's as simple as that. If you aren't going to sell BTC, the size of the stack is irrelevant to meeting obligations, only dilution meets obligations.
