Bitmine CEO Pledges 150,000 Shares in Prepaid Variable Forward Deal
Rhea-AI Filing Summary
Jonathan Robert Bates, Director and CEO of Bitmine Immersion Technologies, Inc. (BMNR), entered into two prepaid variable forward contracts on 09/22/2025 covering an aggregate Base Amount of 150,000 common shares (50,000 for himself and 100,000 for Progression Asset Management Corporation). In exchange for the contracts he received cash payments of $2,389,663 and $4,779,326, respectively, totaling $7,168,989. The contracts require delivery on a settlement date after September 11, 2028, with the final number of shares to be delivered determined by a formula tied to the stock's settlement price, subject to a $90.00 cap and a $53.30 floor.
Bates pledged the covered shares as security but retained voting rights during the pledge while being obligated to pay the Bank the economic benefits of dividends. The 100,000-share amount is held indirectly by Progression Asset Management Corporation, a company wholly owned by Bates.
Positive
- Upfront cash received: Bates obtained $7,168,989 in aggregate proceeds from the two prepaid variable forward contracts.
- Retained voting rights: Bates kept voting control of the pledged shares during the pledge term, maintaining governance influence.
Negative
- Pledged shares as collateral: 150,000 shares are pledged to secure obligations, creating a secured counterparty claim on those shares.
- Obligation to deliver shares: Contracts may require delivery of up to the Base Amount (150,000 shares) on settlement, potentially reducing Bates' future equity holdings.
- Dividend economics payable to Bank: Bates is obligated to pay the economic benefits of dividends to the counterparty while retaining voting rights.
Insights
TL;DR: CEO entered prepaid forward contracts, pledging 150,000 shares as collateral while keeping voting control and receiving $7.17M in proceeds.
The transaction indicates management monetizing equity exposure through a prepaid variable forward structure while preserving voting authority. Pledging the underlying shares creates secured obligations and transfers dividend economics to the counterparty, which can affect the company's shareholder composition at settlement. The indirect holding via Progression Asset Management Corporation should be disclosed clearly to avoid confusion about beneficial ownership. Documentation outlines capped and floored settlement mechanics that determine final share delivery.
TL;DR: Two prepaid variable forwards provide immediate liquidity of $7.17M against 150,000 shares, with settlement contingent on future share price within cap/floor bands.
The structure yields significant upfront cash while leaving final share delivery variable, dependent on a formula using a $90 cap and $53.30 floor at maturity. This converts equity exposure into a financed position with potential future dilution if settlement requires full delivery of the Base Amount. The agreements mature after September 11, 2028, so market and credit exposure extend for nearly three years. Retained voting rights mean governance influence remains with Bates during the contract term.
Insider Trade Summary
| Type | Security | Shares | Price | Value |
|---|---|---|---|---|
| Other | Prepaid Variable Forward (obligation to sell) | 50,000 | $0.00 | -- |
| Other | Prepaid Variable Forward (obligation to sell) | 100,000 | $0.00 | -- |
Footnotes (1)
- On September 22, 2025, the Reporting Person entered into a prepaid variable forward contract with an unaffiliated financial institution (the "Bank") for himself and for Progression Asset Management Corporation ("PAMC"), respectively. The contract obligates the Reporting Person to deliver to the Bank up to an aggregate of 50,000 shares and 100,000 shares, respectively (each the "Base Amount") of the Issuer's Common Stock (or, at the Reporting Person's election, an equivalent amount of cash) on a settlement date following September 11, 2028 (the "Maturity Date") (continued on footnote 2 to this Form 4). (Continued from footnote 1 to this Form 4) In exchange for assuming this obligation, the Reporting Person received a cash payment of $2,389,663 and $4,779,326, respectively. The Reporting Person respectively pledged 50,000 shares and 100,000 shares of the Issuer's Common Stock (the "Pledged Shares") to secure his obligations under the contract, and retained voting rights in the Pledged Shares during the term of the pledge, but is obligated to pay to the Bank the economic benefits of dividends. The number of shares of the Issuer's Common Stock to be delivered by the Reporting Person to the Bank on the Settlement Date (first business day following the Maturity Date) is to be generally determined as follows: (a) if the closing price of shares of the Issuer's Common Stock on the Maturity Date (the "Settlement Price") is less than $90.00 ("Cap Level") but greater than $53.30 ("Floor Level"), the Reporting Person will deliver a number of shares of the Issuer's Common Stock equal to the Base Amount multiplied by a ratio equal to the Floor Level divided by the Settlement Price; (continued on footnote 4 to this Form 4) (Continued from footnote 3 to this Form 4) (b) if the Settlement Price is equal to or greater than the Cap Level on the Maturity Date, the Reporting Person will deliver a number of shares of the Issuer's Common Stock equal to the Base Amount multiplied by a ratio equal to a fraction with a numerator equal to the sum of (A) the Floor Level and (B) the excess, if any, of the Settlement Price over the Cap Level, and a denominator equal to the Settlement Price; and (c) if the Settlement Price is equal to or less than the Floor Level on the Maturity Date, the Reporting Person will deliver a number of shares of the Issuer's Common Stock equal to the Base Amount. Held by Progression Asset Management Corporation, a California corporation wholly owned by the Reporting Person.
