Super League shareholders approve Metaplanet's 2,100 bitcoin investment

A deal under which Japan-listed Metaplanet will contribute bitcoin in exchange for new shares of a Nasdaq-listed U.S. company has won shareholder approval. Super League (Nasdaq: SLE), a gaming advertising and media company, said on Oct. 19 (U.S. time) that its stockholders approved all proposals related to Metaplanet's investment at its annual meeting held on Oct. 16. At closing, Metaplanet will contribute 2,100 bitcoin and $2.5 million in cash to Super League.

Share count fixed in August despite bitcoin's price rise

The two companies signed a definitive agreement on Aug. 18. Metaplanet will invest through its wholly owned U.S. subsidiary, Metaplanet Holdings, and in return receive 44,859,400 common shares at $3.00 per share. The share count was fixed using bitcoin's closing price on the Coinbase Exchange at 4 p.m. New York time on Aug. 14, the agreement's reference date, and will not change with the price of bitcoin before closing.

According to Super League, the 2,100 bitcoin were valued at about $132.1 million on the reference date and at about $170.0 million as of Oct. 16, the day of the meeting. The company added that bitcoin's price is volatile and will continue to fluctuate.

100 convertible preferred shares and warrants for 381 million shares

Metaplanet will also receive preferred stock and warrants. At closing, it will get 100 shares of convertible perpetual preferred stock carrying certain governance and voting rights, and ten-year warrants to buy up to 381 million common shares. The warrants come in four tranches, with exercise prices stepping up from $3.00 to $33.50 per share. For 24 months after closing, Metaplanet will also have the right to subscribe for up to 2.1 million shares of non-convertible junior liquidity preferred stock with a stated value of $100 per share, or up to $210 million.

Metaplanet agreed to a five-year lock-up on the common shares it receives at closing and on any common shares issued through warrant exercise or preferred conversion, subject to certain exceptions. According to a Form 8-K that Super League filed with the U.S. Securities and Exchange Commission (SEC), the key proposal to issue up to 435,859,500 common shares passed with 1,055,621 votes for, 25,314 against and 19,343 abstentions. That issuance cap covers Metaplanet's portion as well as that of Evo Fund, an investor that signed its own agreement on the same day. Shareholders also approved, on an advisory basis, a charter amendment raising authorized common stock from 750 million to 1 billion shares and authorized preferred stock from 10 million to 100 million shares.

"If the transaction closes, we would no longer be defined solely by our current scale."

Matt Edelman, Chairman and CEO of Super League

New name Superplanet, new ticker SUPA

Super League said it is targeting a closing in the fourth quarter of this year, subject to customary closing conditions including required filings with Nasdaq. At closing, the company will be renamed Superplanet and trade on Nasdaq under the ticker SUPA. Its existing advertising and media business will continue as a distinct segment, and Edelman will remain CEO. Super League said that because the bitcoin will arrive in kind, it will establish a bitcoin treasury without having to buy on the open market.

Metaplanet, listed on the Tokyo Stock Exchange (code 3350), held 44,000 bitcoin as of Sept. 30. The company disclosed on Oct. 5 that it sold 10,000 bitcoin and bought 11,000 in the third quarter, a net increase of 1,000. At 10:40 a.m. KST on Oct. 20, bitcoin traded at $81,683 on Binance and 109,592,000 won on Upbit's Korean won market. At the Binance price, 2,100 bitcoin are worth about $171.5 million.