STRK: payment rights, conversion and priority
Readable contract detail to support the STRK investment assessment.
Core terms reviewed September 12; focused payment/conversion clarifications September 14; priority and source corrections checked September 16, 2026. Original document dates remain beside the sources. This page does not introduce a new price, share count or recovery estimate.
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What the preferred share provides
An 8% annual dividend on $100 stated amount, cumulative under the terms, with no scheduled maturity. Strategy chooses cash, MSTR shares or a mix for declared dividends. Holders separately choose whether to exercise conversion.
Payments and unpaid dividends
Dividend rate
STRK has an 8% cumulative annual dividend on a $100 stated amount, payable quarterly under its terms.
Normal full-quarter amount is $2 per share. Dates are March 31, June 30, September 30 and December 31, with business-day adjustment. This is the contractual rate, not market yield.
Original STRK Certificate of Designations — §1 Regular Dividend Rate and Payment Date · STRK Certificate of Amendment — amendments 1 and 3 / amended §5(a)
Payment discretion
Dividends can be paid in cash, MSTR shares or a mix. Cash payment is not guaranteed.
Dividends generally require declaration; cash requires legally available funds. Section 5(b) requires the next dividend to the extent sufficient net proceeds arise from a qualifying registered cash common-equity offering in the 90 days preceding the regular record date, subject to senior stock. Stock election requires notice; the 95% VWAP formula, adjusted floor-price cap and available authorized shares can limit stock settlement. An unpaid remainder continues as arrears.
Original STRK Certificate of Designations — §5(b), §5(c)(i)–(iv); §1 Regular Dividend Stock Price and Floor Price · STRK Certificate of Amendment — amendment 3
Arrears
Unpaid regular dividends accumulate and compound quarterly at the same 8% annual rate.
Accumulation continues regardless of declaration or legal availability. Compounding applies to unpaid dividends from the missed payment date until paid, not an escalating rate on the entire stated amount. Partial periods use the certificate day-count rules.
STRK Certificate of Amendment — amendment 3, amended §5(a)(i)–(ii)
Conversion into MSTR common stock
At the issuer’s August 23 stated rate, one STRK converts into 0.1 MSTR share, subject to adjustments and procedures. Gross conversion value at that rate equals 0.1 × the MSTR share price. This is a formula, not a forecast or a claim about today’s MSTR price.
The initial $1,000 conversion price is $100 stated amount ÷ 0.1; it is not a promised STRK sale price or the break-even price for every buyer. Conversion replaces preferred rights with common-stock exposure. Dividend and record-date rules can affect what a converting holder receives.
Holder conversion
Holders can elect conversion into MSTR common stock, subject to the certificate’s procedures and adjustments.
Initial rate is 0.1 MSTR share per STRK. The issuer also described 0.1000 as current in its August 23 briefing, filed August 24. Specified anti-dilution events can adjust it. Conversion replaces the preferred position with common exposure; no general make-whole for lost option value is provided. No issuer forced-conversion right is identified in §10. Record-date and dividend treatment restrictions apply.
Original STRK Certificate of Designations — §10(a)–(h), especially §10(c), (e), (f); §3(p)(iv) · STRK Certificate of Amendment — amendment 1 Conversion Price · STRK investor briefing in FWP — STRK §06 Conversion Economics
Priority within Strategy
STRE is Strategy’s euro-denominated preferred stock; it is included here to explain the stack, but is not one of this site’s six covered securities.
| Right | Named stock order, higher to lower |
|---|---|
| Dividend priority | STRF → STRC → STRE → STRK → STRD → common stock |
| Liquidation priority | STRF → STRC → STRE → STRK → STRD → common stock |
Creditors rank ahead of stock claims. Subsidiary creditors have claims on subsidiary assets ahead of the parent’s ownership interest. Priority is not collateral or guaranteed payment/recovery; this is a named-class ordering, not a complete current dollar capital structure. SATA and BMNP have different issuers.
Strategy registered-security terms: ranking · STRC ranking, SA21 · STRE ranking, S30 · STRK ranking, SA6
Position in capital structure
STRK ranks ahead of common equity, but behind creditors and senior preferred stock. Bitcoin is not pledged as collateral to STRK.
Priority is a claim on residual assets, not a promised recovery. Subsidiary liabilities are structurally ahead of the parent preferred claim. This page does not estimate coverage, recovery or a current complete dollar capital stack.
Original STRK Certificate of Designations — §1 junior/senior definitions; §4; §6 · STRK investor briefing in FWP — STRK opening Structural Note and §09 Credit Position
Liquidation preference
Liquidation preference can differ from the $100 stated amount.
The amendment uses the greatest of $100 and specified recent market-price measures; one branch is conditional on a recent executed sale transaction to be settled by issuance. Liquidation distribution uses the preference on the business day before payment, plus applicable arrears. This is not a guaranteed market price, cash reserve, secured amount, or verified current preference. No current dollar preference is asserted.
STRK Certificate of Amendment — amendments 1 and 4; amended §1 Liquidation Preference and §6(a)
Redemption, fundamental change and no maturity
Issuer redemption
The certificate provides limited cleanup and tax redemption rights, not a general anytime $100 call.
Cleanup requires outstanding stated amount below 25% of the initial issuance stated amount and redemption of all shares. Cleanup price is the applicable liquidation preference on the business day before notice plus applicable arrears. Tax price uses the greater of that preference and the specified five-day average closing price, plus arrears. Record-date rules prevent double counting. Open-market repurchases are separately permitted.
Original STRK Certificate of Designations — §7(b), (d)–(f); §3(q) · STRK Certificate of Amendment — amendments 5–6, §§7(a),(c)
Fundamental-change holder right
A defined fundamental change can give holders a cash repurchase right at $100 plus applicable unpaid dividends, subject to the certificate’s limits.
Cash is limited by legally available funds; procedural deadlines apply. Definitions include specified control/asset transactions and MSTR Class A common-stock delisting from the named exchanges, with exceptions, including the qualifying 90% listed-common-equity consideration exception for clause (a)/(b) transactions. A STRK-only delisting is not the same trigger. Section 8(j) exempts certain all-cash common-stock transactions if conversion delivers at least the prescribed repurchase amount and notice conditions are met.
Original STRK Certificate of Designations — §1 Fundamental Change; §8(a)–(j) · STRK Certificate of Amendment — amendment 7 / §8(d)
Perpetual security
STRK has no scheduled maturity or sinking fund.
Limited holder repurchase and issuer redemption rights do not create an ordinary maturity date or general right to cash out at $100.
Original STRK Certificate of Designations — §14; §§7–8 · STRK investor briefing in FWP — STRK §02 Security Terms
Voting and conditional director rights
Conditional director rights
Four and eight consecutive incomplete quarterly payments can activate rights to elect preferred directors, with a shared maximum of two.
Definition counts failure to declare and pay the full accumulated dividend; cash or stock settlement can satisfy payment, and qualifying declared cash set aside counts. Election occurs at the next annual or earlier special meeting, with other eligible parity holders and independence conditions. Rights end when arrears are cured. This is not automatic board control or immediate appointment.
Original STRK Certificate of Designations — §1 Regular Dividend Non-Payment Event; §9(a)
Protective votes
Limited protective voting rights do not give STRK holders a veto over new senior preferred stock.
Majority consent applies to specified materially adverse changes, subject to exceptions. Sections 3(c) and 9(b) expressly permit creating or increasing other series, including senior stock, without STRK class consent. General stockholder voting power is not conferred.
Original STRK Certificate of Designations — §3(c); §9(b)(i), especially (y)(III)
Which documents govern these terms?
Operative chain
Read the February 5, 2025 certificate together with the July 7 amendment and later ratification disclosure.
The Q2 2026 filing reports common-holder ratification on June 8, 2026 under DGCL §204 of the filing and effectiveness of the July 7 amendment. The original text alone gives superseded dividend-base and repurchase-price wording. No later replacement affecting these retained terms was found in the checks described in the register.
Original STRK Certificate of Designations — cover and preamble · STRK Certificate of Amendment — preamble, amendments 1–7 · Q2 2026 Form 10-Q Note 10 — Note 10 first paragraph
The sources above control if a summary omits a contractual condition.