what do you mean you will "be converted and burned"?

If the payout were entirely liquid then I could take the STEEM I receive and trade it on the internal market for SBD in order to convert it to SBD. However, I'll actually receive STEEM Power which is not liquid, so I'll just use an equivalent amount of my own SBD, meaning I'll receive SP and give up equivalent SBD and come out even. As far as the burning part, that involves sending it to the @null account, which removes it from the money supply (the same process that is used to pay for visibility on the Promoted page). The eventual net effect of the burning is to slightly reduce the total amount of STEEM and therefore make everyone's STEEM worth slightly more.