Maturity & Settlement

Maturity is when everything settles. Note holders claim their principal. Warrants must be exercised or they expire.

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What Happens at Maturity

Maturity date arrives
        │
        ├──────────────────────────────┐
        │                              │
        ▼                              ▼
    NOTE NFT                      WARRANT NFT
        │                              │
        ▼                              ▼
  Claim principal               Exercise for $MSTR
  (anytime after)               (before expiry)
                                       │
                                       or
                                       │
                                       ▼
                                Let expire worthless

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Note Settlement: BTC Bonds

Simple and direct:

You hold Note NFT
        │
        ▼
Claim from series proceeds
        │
        ▼
Receive BTC

Your BTC was held by the protocol. Now it's returned to you.

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Note Settlement: USD Bonds

A few more steps:

You hold Note NFT
        │
        ▼
Series proceeds (BTC) sold to USDT
        │
        ▼
┌─────────────────────────────┐
│  Enough USDT for everyone?  │
└─────────────────────────────┘
        │              │
       YES             NO
        │              │
        ▼              ▼
  Claim USDT     Insurance Pool
                 covers shortfall
                       │
                       ▼
                 Claim USDT ✓

Either way, Note holders get their USDT.

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When Can You Claim?

Anytime after maturity. There's no deadline.

Your Note NFT remains valid and transferable even after maturity. Claim when you're ready.

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Warrant Settlement

Warrants have an expiry date. You must act before then.

$MSTR Price vs. Strike	Recommended Action
Above strike	Exercise → receive $MSTR
Below strike	Let expire (or sell if there's residual value)

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Example: Full Settlement

Series: USD Bond Series C

Maturity date: January 2027

Kate holds:

• Note NFT — $1,000 face value

• Warrant NFT — Strike price $15, 66.67 $MSTR

At maturity:

• Series proceeds: $960K (short of $1M total owed)

• Insurance Pool covers the $40K gap

• Kate claims her Note → receives $1,000 USDT ✓

$MSTR price: $22 (above her $15 strike)

• Kate exercises her Warrant

• Pays: $1,000 USDT

• Receives: 66.67 $MSTR (worth $1,466.74 at market)

Kate's result:

• Got principal back ✓

• Made $466.74 profit on Warrant ✓

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Example: Warrant Expires Worthless

Same series, different holder.

Leo holds:

• Warrant NFT — Strike price $15, 66.67 $MSTR

At expiry:

• $MSTR price: $11 (below his $15 strike)

Leo's options:

• Exercise? Would pay $1,000 for $MSTR worth $733.37. Bad deal.

• Sell? Maybe someone buys it for a small amount hoping for a last-minute spike.

• Let expire? Loses nothing extra — just misses potential upside.

Leo lets it expire. The Warrant was "out of the money."

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Settlement Summary

Instrument	After Maturity
Note NFT	Claim principal anytime (no deadline)
Warrant NFT	Exercise before expiry or it expires worthless

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Next: Risks — what could go wrong for each participant.