Metaplanet cut its maximum share pool by 41% and extinguished more than $220 million in potential warrant value on Sept. 11, a reset of its 10th-series stock acquisition rights that independent directors defended in a Sept. 29 letter to shareholders.

The directors argued management purchased the rights at fair value using personal funds during a financial crisis at Metaplanet, then a struggling hotel operator, when there was no guarantee the company's transformation would succeed. None of the current independent directors sat on the board when the rights were originally issued.

The board framed the equity scheme as a restructuring investment and a long-term incentive, and said management's cash pay remained restrained. Comparisons with peers, the directors added, must account for founder ownership alongside executive compensation.

What did the Sept. 11 reset change?

Metaplanet reduced the maximum share pool to 188.2 million shares and ended automatic dilution adjustments for equity issued after Sept. 1, 2025. The company added staggered exercise restrictions running through 2031 and extended the lockup on already-exercised shares until August 2031.

The directors said the changes improved fully diluted bitcoin per share by approximately 8.8%, a per-share metric tied to the value of the company's bitcoin holdings. Exercised and unexercised rights represent about 12.5% of total shares outstanding.

Why are shareholders protesting?

The original scheme aimed to keep management's stake at 20% as new shares were issued, a threshold investors viewed as dilutive. CEO Simon Gerovich, the only director holding the rights, recused himself from the review's deliberations and resolutions, the board said.

The directors pointed to the Feb. 2023 shareholder vote, where more than 98% of voting rights approved the rights' terms. Approval falls to 78.3% when then-majority shareholder EVO is excluded, a calculation critics use to argue the scheme lacked broad independent support at inception.

What went unanswered?

The Sept. 29 letter leaves two material questions unresolved. The 64 million shares Gerovich received in August by exercising rights before the Sept. 11 reset remain unrestored; Metaplanet has previously said those shares will not be returned, citing validity under the terms in force at the time.

The directors also did not address concerns about MMXX Ventures, a Metaplanet shareholder whose sales and Gerovich's personal economic interest in the entity have drawn investor questions.

What's next for the warrant dispute?

With the structural revisions locked in but the August exercises and MMXX Ventures ownership chain untouched, shareholder activists are likely to escalate the issue at Metaplanet's next general meeting. Staggered exercise restrictions through 2031 and the extended lockup will set the dilution timeline for years, while fully diluted bitcoin per share becomes the principal yardstick for assessing whether the remaining 12.5% overhang is offset by further bitcoin accumulation.

Metaplanet (3350) shares closed 2% higher on Wednesday at 286 yen.