In brief
- Metaplanet’s independent directors wrote to shareholders on 29 September to defend the Series 10 warrants held by the founding team.
- They call the warrants “turnaround equity” bought at fair value in 2023, when the company was still a struggling hotel operator.
- The board has already cut the shares under the warrants by about 41% and ended the clause that grew them with every share sale.
Metaplanet’s independent directors have stepped into the row over the Bitcoin treasury company’s executive warrants. In a letter to shareholders dated 29 September, they backed Founder and CEO Simon Gerovich’s 11 September note on the Series 10 warrants and said much of the recent commentary “has not reflected the full history” of the plan.
The directors argue the warrants should not be judged as normal executive pay. They were set up when Metaplanet was “a struggling, Japan-centric hotel operator with an uncertain future”, and the team bought them with its own money at fair value, accepted long vesting and took limited cash pay. None of the current independent directors sat on the board when the plan was approved.
Why the warrant pool kept growing
The original terms carried an adjustment clause. Each time Metaplanet issued new shares, the number of shares tied to the warrants rose to keep the leadership team’s stake at 20% of the company. Because Metaplanet sold large amounts of stock to buy Bitcoin, that clause drove the dilution that angered investors. The directors stress that this was the approved formula at work, not a string of new grants.
Shareholders approved the plan at an extraordinary meeting on 7 February 2023. The letter gives the vote in detail: more than 98% in favour including EVO, then the majority owner, but 78.3% by voting rights and 86.8% by headcount once EVO is excluded. Gerovich, a warrant holder, stayed out of the board’s review and vote.
What the board has changed
With the holders’ consent, the board removed the automatic adjustment in August and in September limited it to shares issued up to 1 September 2025. According to the fact sheet, it also:
- cut the shares underlying the warrants by about 41%, removing more than $220 million of potential warrant value;
- lifted Bitcoin per fully diluted share by about 8.8%;
- added lock-up and exercise limits that run to 2031;
- dropped a planned employee warrant pool and hired an international pay adviser.
The Series 10 warrants now account for about 12.5% of Metaplanet’s shares, a share that falls with any new equity issue. The directors say Bitcoin per fully diluted share is up about 60 times since the first purchase in April 2024. How treasury companies fund their buying is under closer watch across the sector, from Strategy’s latest Bitcoin purchase and STRC buyback to Bitmine’s push past 6 million ETH.
Next to watch is the performance-based pay plan the board is drafting with its new adviser, and whether shareholders see it as a real fix for the dilution concerns.
