DEF 14A of Terawulf Inc.
Filed Mar 26, 2025 · FY20240001083301-25-000023
PROPOSAL 1 – ELECTION OF DIRECTORS
PROPOSAL 1 – ELECTION OF DIRECTORS Under the Company’s amended and restated bylaws (the “bylaws”) and an amended and restated certificate of incorporation (the “certificate of incorporation”), the Board of Directors shall consist of not less than three (3) nor more than ten (10) members, which number is determined by resolution of the Board of Directors. Christopher Jarvis, who joined the Board of Directors in January 2024, will not stand for reelection at the 2025 Annual Meeting of Stockholders. As a result, this year you are voting on the election of nine (9) candidates for the Board of Directors. Directors are elected at each annual meeting of stockholders by the plurality of the votes cast. Except for directors elected by the holders of any series of preferred stock, any director or the entire Board of Directors may be removed from office at any time, with or without cause, but only by the affirmative vote of a majority of the total voting power of the outstanding shares of capital stock entitled to vote generally in the election of directors, voting together as a single class. Newly created directorships resulting from any increase in our authorized number of directors or any vacancies in our Board of Directors resulting from death, resignation, retirement, removal from office or other cause shall be filled solely by the affirmative vote of a majority of the remaining directors then in office, even though less than a quorum of the Board of Directors, or by a sole remaining director. The Board of Directors currently consists of nine directors. All nominees for directors are members of the current Board of Directors. If any nominee for election to the Board of Directors should be unable or unwilling to accept nomination or election as a director, which is not expected, your proxy may be voted for a substitute or substitutes designated by the Board of Directors or the number of directors constituting the Board of Directors may be reduced in accordance with the Company’s certificate of incorporation and bylaws. The Board of Directors recommends that the stockholders vote FOR the election of the nominees for directors listed below.
THE BOARD OF DIRECTORS
THE BOARD OF DIRECTORS The following table sets forth certain information as of the date of this proxy statement about our nominees for election as a director.
THE BOARD OF DIRECTORS
| Name | Age | Position | | Paul Prager | 66 | Co-Founder, Chairman of the Board of Directors and Chief Executive Officer | | Nazar Khan | 48 | Co-Founder, Chief Technology Officer and Executive Director | | Kerri Langlais | 48 | Chief Strategy Officer and Executive Director | | Michael Bucella | 38 | Director | | Walter Carter | 66 | Director | | Amanda Fabiano | 38 | Director | | Catherine Motz | 53 | Director | | Steven Pincus | 66 | Director | | Lisa Prager | 68 | Director |
THE BOARD OF DIRECTORS
Paul Prager has been the Co-Founder, Chairman of the Board of Directors, and Chief Executive Officer of the Company since February 2021. In 1990, Mr. Prager founded and has since been the President of Beowulf Electricity & Data Inc. (“Beowulf”), a private energy and digital infrastructure company, and its predecessor companies. He also founded Brooklyn Marine & Oil LLC (a shipowner and operator) and was previously the Chief Executive Officer of Direct Gas. Mr. Prager is a graduate of the U.S. Naval Academy and was a member of the investment committee and trustee of the U.S. Naval Academy Foundation until 2025. Mr. Prager has valuable experience leading organizations and a strong operational and strategic background with significant experience in power generation, infrastructure development, commodity trading and international shipping. Nazar Khan is the Co-Founder and Chief Technology Officer of the Company and has served on the Board of Directors since February 2021. He also served as the Company’s Chief Operating Officer from February 2021 through December 2024. Mr. Khan oversees the development and implementation of TeraWulf’s day-to-day operations, including site evaluation, infrastructure buildout and identification of future growth opportunities with respect to the Company’s bitcoin mining and HPC/AI businesses. As the Chief Technology Officer, Mr. Khan is responsible for TeraWulf’s technology resources and identifies the technologies to improve the efficiency of TeraWulf’s bitcoin mining and data center businesses. From January 2002 to February 2021, Mr. Khan served as the Executive Vice President of Beowulf, where he led the firm’s acquisition and development efforts. Prior to Beowulf, Mr. Khan worked at Evercore Partners Inc. in both investment banking and private equity. Mr. Khan received a B.S. and a B.A. from the University of Pennsylvania. Mr. Khan brings tremendous experience in energy infrastructure, cryptocurrency mining and data center operations to the Board of Directors and has led TeraWulf’s business strategy since its inception. Kerri Langlais has been the Chief Strategy Officer of TeraWulf since February 2021 and has also served on the Board of Directors since March 2022, where she is responsible for the development and implementation of the Company’s overall corporate strategy, business development, strategic partnerships and growth initiatives. From July 2010 to February 2021, Ms. Langlais served as an executive at Beowulf, where she led the firm’s M&A and financing efforts. Prior to Beowulf, Ms. Langlais spent nearly a decade in the Investment Banking Division at Goldman Sachs, where she was most recently in the Natural Resources advisory group in New York. Ms. Langlais also worked at Harvard University, where she provided advisory services to the university’s overall financial strategy and planning. Ms. Langlais received a B.A. in finance and graduated with honors from Boston College. Ms. Langlais brings more than 20 years of M&A, financing, strategy and power sector experience to the Board of Directors. Michael Bucella has been a member of the Board of Directors since March 2022. He is the Co-Founder and Managing Partner of Neoclassic Capital, a U.S.-based investment firm specializing in early-stage Web3 and cryptocurrency ventures, with a strategic focus on the U.S. and Asia markets. From 2017 until 2022, Mr. Bucella was a General Partner at BlockTower Capital, a multi-strategy digital asset investment firm backed by Andreessen Horowitz and Union Square Ventures. He played a pivotal role in scaling BlockTower from inception to over $1 billion AUM, leading investments across hedge funds, early-stage venture, growth equity, and credit strategies. Prior to BlockTower, Mr. Bucella spent nearly a decade at Goldman Sachs in their New York headquarters, joining the firm’s Asset Management Division (GSAM) in 2008, before moving to the firm’s Securities Division in 2010, where he held key leadership positions across the US and Canadian business. He left the firm in 2017 to pursue crypto full-time. Mr. Bucella earned a BS in Finance, Economics & Accounting from Fordham University. Mr. Bucella brings extensive capital markets experience, institutional knowledge and deep experience in the digital asset space to the Board of Directors. Walter “Ted” Carter has been a member of the Board of Directors since November 2021. Mr. Carter was appointed as president of The Ohio State University on August 22, 2023. Prior to this appointment, he was the president of the University of Nebraska since January 2020, after retiring as Vice Admiral following 38 years of service in the U.S. Navy. Most recently from July 2014 until July 2019, Mr. Carter served as Superintendent of the U.S. Naval Academy, his alma matter. Under his leadership, the U.S. Naval Academy reached the No. 1 public school ranking by Forbes and expanded academic opportunity and diversity. Mr. Carter is a Distinguished Flying Cross and Bronze Star recipient. He graduated from the Navy Fighter Weapons School (Top Gun) in Miramar, California, and was commander for the Carrier Strike Group Twelve, in which he commanded 20 ships, two nuclear-powered aircraft carriers and two carrier air wings that were deployed to Afghanistan in the Arabian Gulf. He is a naval flight officer with more than 6,300 flying hours and has completed 2,016 carrier-arrested landings, an American record. Mr. Carter’s extensive leadership background brings a strong commitment to corporate ethics, values and business practices to the Board of Directors. Amanda Fabiano has been a member of the Board of Directors since January 2024. In 2024, Mrs. Fabiano co-founded Second Gate Advisory, rebranding her digital asset advisory firm, Fabiano Consulting, which she originally established as a bitcoin mining consultancy in 2023. Previously, Mrs. Fabiano was a founding member of the proprietary bitcoin mining business at Galaxy Digital Holdings (TSX: GLXY), a cryptocurrency financial services firm, where she spearheaded Galaxy’s acquisition of Helios from Argo Blockchain in December 2022. Prior to Galaxy, Mrs. Fabiano served as Director of Bitcoin Mining at Fidelity Investments from 2014. Mrs. Fabiano previously served on the boards of Compass Mining and Aspen Creek Digital Corporation and has had her work featured in various publications, such as CNBC, Forbes, Bloomberg and CoinDesk. Mrs. Fabiano holds a bachelor’s degree in Sociology, with a concentration in Criminal Justice from the University of Massachusetts. Catherine “Cassie” Motz has been a member of the Board of Directors since November 2021. Since January 2014, Ms. Motz has been the Executive Director of the CollegeBound Foundation in Baltimore, a nonprofit focused on helping Baltimore City students matriculate to college. Ms. Motz previously served on the University System of Maryland Board of Regents from June 2014 through March 2015 and as a Deputy Chief of Staff to Maryland Governor Martin O’Malley. She also served as Deputy Legal Counsel to Governor O’Malley and as the Interim Director of the Governor’s Office for Children. Earlier in her career as an Assistant U.S. Attorney, Ms. Motz prosecuted homicide and domestic violence cases and argued appellate cases in federal and local courts. She later served as a Deputy Attorney General for the District of Columbia government, representing the city’s child welfare and mental health agencies. Ms. Motz also taught as an adjunct professor at the University of Maryland School of Law. Ms. Motz graduated summa cum laude from Dartmouth College with a B.A. in history and earned a J.D. from Yale Law School. Ms. Motz brings extensive leadership and public policy experience to the Board of Directors. Her distinguished career in both non-profit and government helps the Company execute its strategy of sustainable growth and community impact.
THE BOARD OF DIRECTORS
Steven Pincus has been a member of the Board of Directors since November 2021. Mr. Pincus served as an Executive Vice President with global insurance company Willis Towers Watson since April 2002 and was the Global Head of Broking for the firm’s FINEX business until August 2022. Most recently, he served as Executive Vice President of Willis Towers in Corporate Risk and Broking until his retirement in January 2024. With over 40 years of experience, Mr. Pincus has extensive expertise in the energy and high-tech sectors. Mr. Pincus began his career at AIG and held senior roles at Johnson & Higgins and Aon. Mr. Pincus served on the board of The Storefront Academy, a tuition-free private school in Harlem, New York. He received his BSBA in economics from the University of Arizona. Mr. Pincus brings substantial risk management, financial oversight and operational expertise to the Board of Directors. Lisa Prager has been a member of the Board of Directors since November 2021. Ms. Prager serves as the General Counsel and Executive Vice President of the Agricultural Bank of China - New York Branch, an international commercial bank and financial services provider, since September 2017. Prior to joining the Agricultural Bank of China and through August 2017, Ms. Prager was a partner in law firms where she focused on government investigations. Prior to entering private practice, Ms. Prager was a federal prosecutor in the U.S. Attorney’s Office for the District of Columbia and Acting Assistant Secretary and Deputy Assistant Secretary for Export Enforcement at the U.S. Department of Commerce’s Bureau of Industry and Security. As an Assistant U.S. Attorney, Ms. Prager handled federal cases involving terrorism, wire and mail fraud, economic espionage, and export control violations, among other matters. Ms. Prager received a B.A. from Yale University and J.D. from Western New England University School of Law.
Pay for Performance Alignment
Pay for Performance Alignment The Compensation Committee assessed 2024 executive performance based on profitability, Bitcoin mining efficiency, and infrastructure expansion milestones. Compensation decisions reflected strong execution in these areas. •Annual Cash Bonuses: Short-term incentives were awarded based on individual and overall company performance, including financial results, operational efficiency, and strategic transactions such as financings and M&A activities. •Long-Term Equity Awards: A substantial portion of executive pay was granted as performance-based and time-based restricted stock units (RSUs/PSUs), ensuring alignment with long-term stockholder value creation. •CEO Compensation: The CEO’s 2024 compensation was predominantly at-risk, with a significant equity component dependent upon achievement of pre-established stock price hurdles.
Overview of Executive Compensation Governance Practices
Overview of Executive Compensation Governance Practices WHAT WE DO: Pay for performance. The majority of named executives’ target total direct compensation is at-risk and designed to align with our short- and long-term strategic objectives. Clear Performance Goals. Our equity compensation program includes objective, challenging performance metrics aligned with strategic objectives. Independent committee. The Compensation Committee comprises only of independent Board members. WHAT WE DON’T DO No single trigger vesting. Our NEOs are not offered single trigger vesting on a change-in-control. No significant perquisites. Our NEOs are not offered significant perquisites. No margin purchases or short sales: Executives and Board members are prohibited from purchasing the Company stock on margin, engaging in short sales and buying or selling puts, calls, options or other derivatives in respect of the Company’s securities.
Compensation Consultant
Compensation Consultant To ensure an objective approach, the Compensation Committee engaged Lyons Benenson & Company and Compensia Inc. for executive compensation advisory services. Neither firm provided additional services to the Company in fiscal 2024.
Peer Group Development
Peer Group Development While the Company has not yet established a formal peer group of HPC/AI companies as a result of its expansion into HPC hosting and colocation services, the Compensation Committee, in collaboration with Compensia Inc., is conducting a formal comprehensive peer benchmarking analysis. The findings, expected in 2025, will serve as a reference for future executive compensation decisions.
Employment Agreements
Employment Agreements The Company is party to an employment agreement with each of Mr. Prager, Mr. Fleury, Ms. Langlais, Mr. Khan and Mr. Deane (the “TW Employment Agreements”). The TW Employment Agreements provide for the general terms of employment, including an initial annual base salary (which amounts are currently at $1,000,000 for Mr. Prager, $500,000 for each of Mr. Fleury and Ms. Langlais, $750,000 for Mr. Khan and $325,000 for Mr. Deane), annual target bonus opportunity (150% of base salary for Mr. Prager, 85% of base salary for each of Mr. Fleury and Ms. Langlais, 100% of base salary for Mr. Khan and 25% of base salary for Mr. Deane), business expense reimbursement, eligibility to participate and receive awards under the TeraWulf 2021 Omnibus Incentive Plan (the “2021 Plan”) (or its successor plan) and eligibility to participate in the benefit plans and programs made available from time to time for employees generally, including medical, 401(k) and paid time off, subject to the terms and conditions of such benefit plans and programs. Mr. Fleury’s employment agreement also provides for an initial equity inducement award of 1,000,000 RSUs, with 25% of such RSUs vesting on each of the first two anniversaries of the date of grant and the remaining 50% of the RSUs vesting on the third anniversary of the grant date, subject to Mr. Fleury’s continued employment or service with the Company through each such date (the “Inducement Award”). The Inducement Award was granted as an “employment inducement grant” within the meaning of Rule 5635(c)(4) of the Nasdaq Listing Rules and was therefore not awarded under the 2021 Plan. See the section titled “Potential Payments upon Termination of Employment or Change in Control” below for additional details related to severance payments and benefits that will be provided to each of Mr. Prager, Mr. Fleury, Ms. Langlais, Mr. Khan and Mr. Deane pursuant to their respective TW Employment Agreements upon termination of their respective employment under certain circumstances.
Key Components of Executive Compensation
Key Components of Executive Compensation The major elements of compensation for our NEOs are (1) a base salary, intended to provide a stable annual income for each executive officer at a level consistent with such executive officer’s experience and individual contributions to the Company, (2) annual cash bonuses, intended to link each executive officer’s compensation to the Company’s performance and to such executive officer’s business unit and individual performance, and (3) long-term incentive compensation, which includes grants of PSUs and/or RSUs, intended to encourage actions to maximize stockholder value. Each of these elements is discussed in more detail below.
Compensation Element: Annual Cash Bonuses
Compensation Element: Annual Cash Bonuses Discretionary annual cash bonuses are awarded to our NEOs based on our performance (including financial results, operational efficiency, and strategic transactions) and the individual executive officer’s contribution to that performance. Annual cash bonuses are paid at the beginning of the following year if and to the extent performance objectives are achieved. The Compensation Committee believes that the payment of the annual cash bonus provides the incentive necessary to retain executive officers and reward them for short-term Company performance. The 2024 annual target bonus opportunities for each NEO were as follows:
Compensation Element: Annual Cash Bonuses
| Name | 2023 Target Bonus Opportunity (% Base Salary) | 2024 Target Bonus Opportunity (% Base Salary) | 2024 Target Bonus ($)(1) | | Paul Prager | 150% | 150% | 1,500,000 | | Patrick Fleury | 50% | 50% | 250,000 | | Kerri Langlais | 50% | 50% | 250,000 | | Nazar Khan | 100% | 100% | 750,000 | | Kenneth Deane | 25% | 25% | 81,250 |
Compensation Element: Annual Cash Bonuses
(1) Although each of our NEOs have target bonus amounts set forth in their respective employment agreements, the actual bonus amounts payable to the NEOs are discretionary and not formulaically determined, and take into account both objective and subjective performance factors as determined by the Compensation Committee, subject to continued employment through the payment date. As previously noted, annual cash bonuses are determined based on financial results, operational performance, and the achievement of strategic milestones. In fiscal 2024, the Company reached several key milestones, including the sale of its 25% equity interest in Nautilus Cryptomine LLC to a subsidiary of Talen Energy Corporation and the successful completion of a private offering of convertible senior notes, both in October 2024. As a result, the cash bonuses paid in 2024 included extraordinary amounts tied specifically to the achievement of these milestones. The actual bonus amounts payable to each of our NEOs is set forth in the Summary Compensation Table.
Compensation Element: Long-Term Equity Based Incentives
Compensation Element: Long-Term Equity Based Incentives Long-term equity-based incentives are intended to align executive and stockholder interests and encourage strong executive decision-making that maximizes stockholder value creation over the long-term. The values, mix, and type of annual grants for each senior executive are discussed by management and the Compensation Committee and ultimately approved by the Compensation Committee, in consultation with its compensation consultant Lyons Benenson, unless the terms have been previously approved and set forth in an employment agreement. In fiscal 2024, all equity awards to our NEOs were granted under our 2021 Plan. These awards all provide the recipient with the opportunity to receive shares of our Class A Common Stock over a specified period. The RSUs granted to our NEOs are time-based awards vesting on a pro-rata basis over one year on the anniversary date of the grant. By contrast, the PSUs granted to our NEOs only vest upon achieving specified stock price hurdles during a three-year performance period. In fiscal 2024, all performance targets were successfully met. In addition, on October 31, 2024, the Company granted shares of common stock (subject to transfer restrictions) to Mr. Fleury (1,000,000 restricted shares), Ms. Langlais (1,000,000 restricted shares) and Mr. Khan (200,000 restricted shares), which were awarded in light of the Company’s reaching several key milestones, including the sale of its 25% equity interest in Nautilus Cryptomine LLC to a subsidiary of Talen Energy Corporation and the establishment of a new Long-Term Ground Lease at Lake Mariner, both in October 2024. The restricted shares were fully vested upon grant, but are not assignable, saleable or transferable by the recipient NEO until the 12-month anniversary of the grant date, which ensures alignment with our stockholders during such period. The fiscal 2024 long-term equity awards are summarized below:
Compensation Element: Long-Term Equity Based Incentives
| Name / Title | PSUs Stock Price(1) (#) | RSUs Pro-Rata(2) (#) | Vested Restricted Stock(3) (#) | | Paul Prager CEO and Chairman of the Board of Directors | 1,500,000 | 1,000,000 | — | | Patrick Fleury CFO | 420,000 | 280,000 | 1,000,000 | | Kerri Langlais CSO and Director | 420,000 | 280,000 | 1,000,000 | | Nazar Khan CTO and Director | 1,200,000 | 800,000 | 200,000 | | Kenneth Deane CAO and Treasurer | 162,000 | 108,000 | — |
Compensation Element: Long-Term Equity Based Incentives
(1) These PSUs vest only upon the achievement of specified stock price hurdles during a three year performance period, subject to continued employment through the applicable vesting date: (i) one-third (1/3) of the PSUs vest upon achievement by the Company of a Stock Price Hurdle equal to $2.25 per share or greater (which represents a 43.6% increase above the Company’s forty-five (45) day average closing price preceding the date of grant); (ii) one-third (1/3) of the PSUs vest upon achievement by the Company of a Stock Price Hurdle equal to $2.50 per share or greater (which represents a 59.5% increase above the Company’s forty-five (45) day average closing price preceding the date of grant); and (iii) one-third (1/3) of the PSUs vest upon achievement by the Company of a Stock Price Hurdle equal to $2.75 per share or greater (which represents a 75.5% increase above the Company’s forty-five (45) day average closing price preceding the date of grant). The “Stock Price Hurdles” require an average closing price of common stock of the Company on the NASDAQ calculated over the forty-five (45) consecutive trading days immediately preceding the applicable determination date. The applicable Stock Price Hurdles for these 2024 PSUs were achieved as of July 16, 2024. (2) These RSUs vest 50% on the first two six-month anniversaries of January 9, 2024, subject to continued employment through the applicable vesting date. (3) The vested shares of restricted stock are not assignable, saleable or transferable by the recipient NEO until the 12-month anniversary of the grant date.
Summary Compensation Table
Summary Compensation Table The following table sets forth compensation information for our NEOs for services performed for the Company and its subsidiaries for the fiscal year ended December 31, 2024:
Summary Compensation Table
| Name and Principal Position | Year | Salary ($)(1) | Bonus ($) | Stock Awards ($)(2) | All Other Compensation ($)(3) | Total ($) | | Paul Prager, Chief Executive Officer and Chairman of the Board of Directors | 2024 | 960,112 | 1,500,000 | 4,433,145 | 19,383 | 6,912,640 | | | 2023 | 950,545 | 1,425,000 | — | 18,633 | 2,394,178 | | | 2022 | 959,818 | 1,425,000 | — | 17,355 | 2,402,173 | | Patrick Fleury, Chief Financial Officer | 2024 | 419,727 | 1,500,000 | 7,761,281 | 377 | 9,681,385 | | | 2023 | 390,907 | 400,000 | 724,880 | 377 | 1,516,164 | | | 2022 | 215,803 | 175,000 | 3,300,000 | 251 | 3,691,054 | | Kerri Langlais, Chief Strategy Officer and Director | 2024 | 419,727 | 1,400,000 | 7,761,281 | 18,380 | 9,599,388 | | | 2023 | 401,055 | 400,000 | 724,880 | 17,630 | 1,543,565 | | | 2022 | 400,591 | 200,000 | — | 16,380 | 616,971 | | Nazar Khan, Chief Technology Officer and Director | 2024 | 508,188 | 750,000 | 4,850,516 | 18,380 | 6,127,084 | | Kenneth Deane, Chief Accounting Officer and Treasurer | 2024 | 325,496 | 350,000 | 478,780 | 18,781 | 1,173,057 | | | 2023 | 325,699 | 162,500 | 144,976 | 18,494 | 651,669 | | | 2022 | 325,634 | 131,250 | 990,000 | 17,244 | 1,464,128 |
Summary Compensation Table
________________________________ (1) The amounts shown in this column for Mr. Prager include amounts ($474,999 and $219,230 in 2023 and 2022, respectively) that he voluntarily elected to defer receipt to a later year. (2) Represents the aggregate grant date fair value of the restricted stock units (“RSUs”) and performance-based restricted stock units (“PSUs”) granted in 2024 computed in accordance with Financial Accounting Standards Board (“FASB”) Accounting Standards Codification (“ASC”) Topic 718, Compensation-Stock Compensation, which, for PSU awards, is based on the probable outcome of the performance conditions. See Note 4 to our consolidated financial statements included in our Annual Report for the assumptions made in determining these values. The value for each PSU award, as of the grant date, assuming the maximum level of performance, is $2,403,145 for Mr. Prager, $672,881 for each of Mr. Fleury and Ms. Langlais, $1,922,516 for Mr. Khan and $259,540 for Mr. Deane. (3) Amounts reported in the Summary Compensation Table for 2024 as “All Other Compensation” for fiscal year 2024 include the following: for Mr. Prager: employer matching contributions to a defined contribution plan of $17,250 and life insurance premiums of $2,133; for Mr. Fleury: life insurance premiums of $377; for Ms. Langlais: employer matching contributions to a defined contribution plan of $17,250 and life insurance premiums of $1,130; for Mr. Khan: employer matching contributions to a defined contribution plan of $17,250 and life insurance premiums of $1,130; and for Mr. Deane: employer matching contributions to a defined contribution plan of $15,491 and life insurance premiums of $3,290. On six occasions in 2024, family members or guests of Mr. Prager accompanied him on business trips on a Company-leased aircraft. In those instances, there was no incremental cost to the Company, and as a result, no amount is reflected in the table.
Grants of Plan-Based Awards
Grants of Plan-Based Awards The following table represents all plan-based awards granted to our NEOs as of the fiscal year ended December 31, 2024:
Grants of Plan-Based Awards
| | | | Estimated future payouts under equity incentive plan awards | | | All other stock awards: Number of shares of stock or units (#) | Grant date fair value of stock and option awards ($)(4) | | Name | Award | Grant Date | Threshold (#) | Target (#) | Maximum (#) | | | | Paul Prager | PSU(1) | 1/9/2024 | 500,000 | 1,000,000 | 1,500,000 | — | 2,403,145 | | | RSU(2) | 1/9/2024 | | | — | 1,000,000 | 2,030,000 | | Patrick Fleury | PSU(1) | 1/9/2024 | 140,000 | 280,000 | 420,000 | — | 672,881 | | | RSU(2) | 1/9/2024 | | | — | 280,000 | 568,400 | | | Restricted Stock(3) | 10/31/2024 | | | — | 1,000,000 | 6,520,000 | | Kerri Langlais | PSU(1) | 1/9/2024 | 140,000 | 280,000 | 420,000 | | 672,881 | | | RSU(2) | 1/9/2024 | | | — | 280,000 | 568,400 | | | Restricted Stock(3) | 10/31/2024 | | | — | 1,000,000 | 6,520,000 | | Nazar Khan | PSU(1) | 1/9/2024 | 400,000 | 800,000 | 1,200,000 | | 1,922,516 | | | RSU(2) | 1/9/2024 | | | — | 800,000 | 1,624,000 | | | Restricted Stock(3) | 10/31/2024 | | | — | 200,000 | 1,304,000 | | Kenneth Deane | PSU(1) | 1/9/2024 | 54,000 | 108,000 | 162,000 | | 259,540 | | | RSU(2) | 1/9/2024 | | | — | 108,000 | 219,240 |
Grants of Plan-Based Awards
(1) Represents the number of PSUs-Stock Price that were granted in fiscal 2024 under the 2021 Plan. See “Compensation Discussion and Analysis-Key Components of Executive Compensation-Compensation Element: Long-Term Equity-Based Incentives” for a description of the material terms of these awards. (2) Represents the number of RSUs-Pro-Rata that were granted in fiscal 2024 under the 2021 Plan. See “Compensation Discussion and Analysis-Key Components of Executive Compensation-Compensation Element: Long-Term Equity-Based Incentives” for a description of the material terms of these awards. (3) Represents the number of shares of vested restricted stock that were granted in fiscal 2024 under the 2021 Plan. See “Compensation Discussion and Analysis-Key Components of Executive Compensation-Compensation Element: Long-Term Equity-Based Incentives” for a description of the material terms of these awards. (4) The amounts in this column represent the aggregate grant date fair value of the equity awards calculated in accordance with FASB ASC Topic 718. See footnote 2 to the Summary Compensation Table. See Note 4 to our consolidated financial statements included in our Annual Report for the assumptions made in determining these values.
Outstanding Equity Awards at 2024 Fiscal Year End
Outstanding Equity Awards at 2024 Fiscal Year End The following table shows all outstanding Company equity awards held by our NEOs as of the fiscal year ended December 31, 2024:
Outstanding Equity Awards at 2024 Fiscal Year End
| | Stock Awards | | | | | Name | Number of Shares or Units of Stock That Have Not Vested (#) | Market Value of Shares or Units of Stock That Have Not Vested ($)(1) | Equity Incentive Plan Awards: Number of Unearned Shares, Units or Other Rights That Have Not Vested (#) | Equity Incentive Plan Awards: Market or Payout Value of Unearned Shares, Units or Other Rights That Have Not Vested ($) | | Paul Prager | 500,000(3) | 2,830,000 | — | — | | Patrick Fleury | 640,000(2) | 3,622,400 | — | — | | Kerri Langlais | 140,000(3) | 792,400 | — | — | | Nazar Khan | 400,000(3) | 2,264,000 | — | — | | Kenneth Deane | 154,000(4) | 871,640 | — | — |
Outstanding Equity Awards at 2024 Fiscal Year End
__________________________________ (1) The market values shown above are based on the $5.66 closing market price of our common stock on December 31, 2024. (2) The 500,000 RSUs granted in 2022 vest on May 16, 2025. The 140,000 RSUs granted in 2024 vested on January 9, 2025. (3) The RSUs vested on January 9, 2025. (4) The 100,000 RSUs granted in 2022 vest on May 16, 2025. The 54,000 RSUs granted in 2024 vested on January 9, 2025.
Stock Vested During Fiscal 2024
Stock Vested During Fiscal 2024 The following table provides information concerning the vesting of stock awards during fiscal 2024 on an aggregated basis for each of our NEOs.
Stock Vested During Fiscal 2024
| | Stock Awards | | | Name | Number of Shares Acquired on Vesting (#) | Value Realized on Vesting ($) | | Paul Prager | 2,000,000 | 8,102,500 | | Patrick Fleury | 2,610,000 | 12,609,700 | | Kerri Langlais | 2,360,000 | 12,104,700 | | Nazar Khan | 1,800,000 | 7,786,000 | | Kenneth Deane | 476,000 | 1,740,270 |
Non-Qualified Deferred Compensation
Non-Qualified Deferred Compensation The following table provides information with respect to our non-tax-qualified defined contribution and compensation deferral plans for each of our NEOs during fiscal 2024.
Non-Qualified Deferred Compensation
| Name | Executive Contributions in Last FY ($) | Registrant Contributions in Last FY ($) | Aggregate Earnings in Last FY ($) | Aggregate Withdrawals /Distributions ($) | Aggregate Balance at Last FYE ($) | | Paul Prager | — | — | — | 474,999 | — | | Patrick Fleury | — | — | — | — | — | | Kerri Langlais | — | — | — | — | — | | Nazar Khan | — | — | — | — | — | | Kenneth Deane | — | — | — | — | — |
Non-Qualified Deferred Compensation
(1) The amount shown for Mr. Prager reflects the distribution of previously deferred salary from the prior year. None of the NEOs have any outstanding deferred compensation balance as of December 31, 2024. See footnote 1 to the Summary Compensation Table.
Potential Payments upon Termination or Change in Control
Potential Payments upon Termination or Change in Control The following summaries describe the potential payments and benefits that we would provide to our NEOs in connection with a termination of employment and/or a change in control, assuming the applicable triggering event occurred on December 31, 2024.
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control
Potential Payments Upon Termination or Change in Control
| Potential Payments Upon Termination or Change in Control for Paul Prager | | | | | | | | | | | Involuntary Termination Without Cause/by Executive for Good Reason(1) | | Death | | Disability | | Termination Following Change in Control(2) | | | Cash Severance Payment(3) | | 3,000,000 | | 1,500,000 | | 1,500,000 | | 3,000,000 | | Continued Benefits Coverage(4) | 77,013 | | — | | — | | 77,013 | | | Acceleration of RSUs(5) | 2,830,000 | | — | | — | | 2,830,000 | | | Acceleration of PSUs | — | | — | | — | | — | | | Total | | 5,907,013 | | 1,500,000 | | 1,500,000 | | 5,907,013 |
Potential Payments Upon Termination or Change in Control
(1) Assumes a qualifying voluntary resignation for good reason or involuntary termination of employment for any reason other than cause, in either case, absent a change-in-control of the Company. (2) Mr. Prager is not entitled to enhanced severance upon a change-in-control of the Company. (3) The amounts in this row are based on Mr. Prager’s (i) continued base salary for 18 months (this is not applicable on death or disability) and (ii) pro-rated target annual bonus in the year of termination. (4) The amounts in this row represent the cost of Mr. Prager’s monthly health care premium under COBRA for an 18-month period. (5) Represents the value associated with the acceleration or continuation of the vesting of equity awards. In the case of RSUs, the value was based on the $5.66 closing market price of our common stock on the last trading day of fiscal year 2024, December 31, 2024.
Potential Payments Upon Termination or Change in Control
| Potential Payments Upon Termination or Change in Control for Patrick Fleury | | | | | | | | | | | Involuntary Termination Without Cause/by Executive for Good Reason(1) | | Death | | Disability | | Termination Following Change in Control(2) | | | Cash Severance Payment(3) | | 750,000 | | 250,000 | | 250,000 | | 750,000 | | Continued Benefits Coverage(4) | 30,591 | | — | | — | | 30,591 | | | Acceleration of RSUs(5) | 3,622,400 | | — | | — | | 3,622,400 | | | Acceleration of PSUs | — | | — | | — | | — | | | Total | | 4,402,991 | | 250,000 | | 250,000 | | 4,402,991 |
Potential Payments Upon Termination or Change in Control
| Potential Payments Upon Termination or Change in Control for Kerri Langlais | | | | | | | | | | | Involuntary Termination Without Cause/by Executive for Good Reason(1) | | Death | | Disability | | Termination Following Change in Control(2) | | | Cash Severance Payment(3) | | 750,000 | | 250,000 | | 250,000 | | 750,000 | | Continued Benefits Coverage(4) | 31,016 | | — | | — | | 31,016 | | | Acceleration of RSUs(5) | 792,400 | | — | | — | | 792,400 | | | Acceleration of PSUs | — | | — | | — | | — | | | Total | | 1,573,416 | | 250,000 | | 250,000 | | 1,573,416 |
Potential Payments Upon Termination or Change in Control
| Potential Payments Upon Termination or Change in Control for Nazar Khan | | | | | | | | | | | Involuntary Termination Without Cause/by Executive for Good Reason(1) | | Death | | Disability | | Termination Following Change in Control(2) | | | Cash Severance Payment(3) | | 1,500,000 | | 750,000 | | 750,000 | | 1,500,000 | | Continued Benefits Coverage(4) | 35,331 | | — | | — | | 35,331 | | | Acceleration of RSUs(5) | 2,264,000 | | — | | — | | 2,264,000 | | | Acceleration of PSUs | — | | — | | — | | — | | | Total | | 3,799,331 | | 750,000 | | 750,000 | | 3,799,331 |
Potential Payments Upon Termination or Change in Control
| Potential Payments Upon Termination or Change in Control for Kenneth Deane | | | | | | | | | | | Involuntary Termination Without Cause/by Executive for Good Reason(1) | | Death | | Disability | | Termination Following Change in Control(2) | | | Cash Severance Payment(3) | | 406,250 | | 81,250 | | 81,250 | | 406,250 | | Continued Benefits Coverage(4) | 10,626 | | — | | — | | 10,626 | | | Acceleration of RSUs(5) | 871,640 | | — | | — | | 871,640 | | | Acceleration of PSUs | — | | — | | — | | — | | | Total | | 1,288,516 | | 81,250 | | 81,250 | | 1,288,516 |
Potential Payments Upon Termination or Change in Control
(1) Assumes a qualifying voluntary resignation for good reason or involuntary termination of employment for any reason other than cause, in either case, absent a change-in-control of the Company. (2) The NEOs are not entitled to enhanced severance upon a change-in-control of the Company. (3) The amounts in this row are based on the NEO’s (i) continued base salary for 12 months (this is not applicable on death or disability) and (ii) pro-rated annual bonus in the year of termination. (4) The amounts in this row represent the cost of the NEO’s monthly health care premium under COBRA for a 12-month period. (5) Represents the value associated with the acceleration or continuation of the vesting of equity awards. In the case of RSUs, the value was based on the $5.66 closing market price of our common stock on the last trading day of fiscal year 2024, December 31, 2024.
PAY VERSUS PERFORMANCE
PAY VERSUS PERFORMANCE
Pay Versus Performance Table
Pay Versus Performance Table The following table sets out information regarding fiscal years ended December 31, 2024, December 31, 2023, December 31, 2022 and December 31, 2021 in satisfaction of Item 402(v) of Regulation S-K, which requires disclosure regarding executive “compensation actually paid” or “CAP” (as calculated in accordance with SEC rules) and certain Company performance.
Pay Versus Performance Table
| Year | Summary Compensation Table Total for PEO 1 (Paul Prager) ($) | CAP to PEO 1 (Paul Prager) ($) | Summary Compensation Table Total for PEO 2 (Glenn Sandgren) ($) | CAP to PEO 2 (Glenn Sandgren) ($) | Average Summary Compensation Table Total for Non-PEO NEOs ($) | Average CAP to Non-PEO NEOs ($) | Value of Initial Fixed $100 Investment Based On Total Shareholder Return ($) | Net Loss ($) | | | (1) | (2)(4) | (1) | (2) | (3) | (4) | (5) | (6) | | 2024 | 6,912,640 | 13,411,995 | — | — | 6,645,228 | 10,254,041 | 57 | (72,418,000) | | 2023 | 2,394,178 | 2,394,178 | — | — | 1,529,864 | 5,370,434 | 24 | (73,421,000) | | 2022 | 2,402,173 | 2,402,173 | — | — | 2,424,466 | 712,106 | 7 | (90,791,000) | | 2021 | 625,228 | 625,228 | 964,343 | 820,233 | 405,734 | 405,734 | 151 | (95,683,000) |
Pay Versus Performance Table
__________________________________ (1) The dollar amounts reported in this column are the amounts of total compensation reported for our Principal Executive Officer (“PEO”) for each corresponding year in the “Total” column of the Summary Compensation Table, which for 2024, 2023 and 2022, includes our current PEO Paul Prager (PEO 1), and for 2021, includes our current PEO Paul Prager (PEO 1) and former PEO Glenn Sandgren (PEO 2). (2) The dollar amounts reported in this column represent the amount of “compensation actually paid” to our PEO for the applicable fiscal year, as computed in accordance with Item 402(v) of Regulation S-K, which for 2024, 2023 and 2022, includes our current PEO Paul Prager, and for 2021, includes our current PEO Paul Prager and former PEO Glenn Sandgren (PEO 2). The dollar amounts do not reflect the actual amount of compensation earned by or paid to such executives during the applicable year. No adjustments were made to Mr. Prager’s compensation reported in the “Total” column of the Summary Compensation Table as no equity compensation was granted to or outstanding for Mr. Prager during 2023, 2022 and 2021. No adjustments were made to Mr. Sandgren’s compensation reported in the “Total” column of the Summary Compensation Table for the fair value at year-end of his outstanding and unvested equity awards granted in 2021 as such awards were canceled and settled/exercised in connection with the Company’s completion of its business combination, including the related mergers, with IKONICS on December 13, 2021 and, as a result, such values were already included in Mr. Sandgren’s compensation reported in the “All Other Compensation” and “Total” columns of the Summary Compensation Table for the fiscal year 2021 as disclosed in the Company’s 2022 proxy statement. (3) The dollar amounts reported in this column represent the average of the amounts reported for the Company’s non-PEO named executive officers (“Non-PEO NEOs”) as a group in the “Total” column of the Summary Compensation Table in each applicable year. For purposes of calculating the average amounts in each applicable year, the names of each of the Non-PEO NEOs included are as follows: (a) for 2024: Patrick Fleury, Kerri Langlais, Nazar Khan and Kenneth Deane; (b) for 2023: Patrick Fleury and Kerri Langlais; (c) for 2022: Patrick Fleury and Kenneth Deane; and (d) for 2021: Nazar Khan, Kerri Langlais, Claude Piguet and Kenneth Hegman. (4) The dollar amounts reported in this column represent the amount of “compensation actually paid” to the PEO and average amount of “compensation actually paid” to Non-PEO NEOs as a group in the applicable year as computed in accordance with Item 402(v) of Regulation S-K. The dollar amounts do not reflect the actual average amount of compensation earned by or paid to the Non-PEO NEOs as a group during the applicable year. In accordance with the requirements of Item 402(v) of Regulation S-K, the adjustments in the table below were made to the total compensation for the PEO and the average total compensation for the Non-PEO NEOs as a group for 2024 to determine the compensation actually paid.
Pay Versus Performance Table
| | PEO | Average of Non-PEO NEOs | | Fiscal Year | 2024 | 2024 | | Total from Summary Compensation Table | $6,912,640 | $6,645,228 | | (-) Grant Date Fair Value of Option Awards and Stock Awards Granted in Fiscal Year | (4,433,145) | (5,212,964) | | (+) Fair Value at Fiscal Year-End of Outstanding and Unvested Option Awards and Stock Awards Granted in Fiscal Year | 2,830,000 | 1,038,610 | | (+) Fair Value at Vesting Date of Option Awards and Stock Awards Granted and Vested in Fiscal Year | 8,102,500 | 6,559,617 | | (+) Change in Fair Value of Outstanding and Unvested Option Awards and Stock Awards Granted in Prior Fiscal Years | — | 489,000 | | (+) Change in Fair Value as of Vesting Date of Option Awards and Stock Awards Granted in Prior Fiscal Years For Which Applicable Vesting Conditions Were Satisfied During Fiscal Year | — | 734,550 | | Compensation Actually Paid | $13,411,995 | $10,254,041 |
Pay Versus Performance Table
(5) Cumulative Total Shareholder Return (“TSR”) is calculated by dividing the difference between the Company’s share price at the end and the beginning of the measurement period by the Company’s share price at the beginning of the measurement period. The Company did not declare dividends for the fiscal years ended December 31, 2024, 2023 and 2022 and the period from February 8, 2021 (date of inception) to December 31, 2021. (6) Dollar amounts reported in this column represent the amount of net loss reflected in the Company’s audited consolidated financial statements for the fiscal years ended December 31, 2024, 2023 and 2022 and the period from February 8, 2021 (date of inception) to December 31, 2021.
DIRECTOR COMPENSATION
DIRECTOR COMPENSATION
Compensation of Directors
Compensation of Directors Consistent with our non-employee director compensation policy, each of our non-employee directors will receive, as applicable, an annual director fee, fees for serving as the lead independent director or chair of a committee and equity awards in connection with his or her services. In addition, each director is reimbursed for out-of-pocket expenses in connection with his or her services. As employees of the Company, Mr. Prager, Mr. Nazar and Ms. Langlais do not receive any additional compensation for their services on our Board of Directors. Our current non-employee director compensation program has two components: (1) a cash component, designed to compensate members for their service on our Board of Directors and its committees and (2) an equity component, designed to align the interests of our directors and stockholders and, by vesting over time, to create an incentive for continued service on our Board of Directors. The Compensation Committee approved of revisions to the director compensation program in 2024 with such changes to be effective on January 1, 2025. The following table describes the compensation arrangements with our non-employee directors effective for fiscal year 2024 and the changes (if any) that are effective as of January 1, 2025 in parenthesis:
Director Compensation Table for 2024
Director Compensation Table for 2024 During fiscal year 2024, our directors received annual grants of RSU awards with grant date values in the following amounts in accordance with the terms of our non-employee director compensation policy: $90,000 for all our directors, except for Mr. Pincus, who received $115,000 as lead independent director. The RSUs vest on the first anniversary of the grant date, subject to the director’s continued service with the Company through each vesting date. The table below summarizes compensation provided to each non-employee director for services provided during fiscal year 2024.
Director Compensation Table for 2024
| Name | Fees Earned or Paid in Cash ($)(2) | Stock Awards ($)(3)(4) | Total ($) | | Walter Carter | 85,000 | 90,001 | 175,001 | | Catherine Motz | 60,000 | 90,001 | 150,001 | | Steven Pincus | 110,000 | 115,002 | 225,002 | | Lisa Prager | 60,000 | 90,001 | 150,001 | | Michael Bucella | 60,000 | 90,001 | 150,001 | | Amanda Fabiano(1) | 58,022 | 129,590 | 187,612 | | Christopher Jarvis(1) | 58,022 | 129,590 | 187,612 |
Director Compensation Table for 2024
________________________________ (1) On January 12, 2024, our Board of Directors appointed Amanda Fabiano and Christopher Jarvis effective immediately. (2) Amounts set forth in this column represent the aggregate dollar amount of all fees earned or paid in cash for services as a director, including basic retainer fees and committee and/or chair fees under our non-employee director compensation program. On March 8, 2023, our Board of Directors modified our non-employee director compensation policy to permit participating directors to elect to receive cash retainers accrued since the beginning of the fourth fiscal quarter of 2022 in shares of our common stock in lieu of cash, with the number of shares of common stock granted to be equal to the applicable cash retainer divided by the fair market value of our common stock on the last trading day of the applicable fiscal quarter. All our directors elected to receive their respective cash retainers accrued in each quarter of 2024 in shares of our common stock. (3) The amounts set forth in this column represent the aggregate grant date fair value of the RSU awards granted to certain of our directors in 2024 computed in accordance with FASB ASC Topic 718. (4) As of December 31, 2024, Messrs. Carter, Bucella and Mses. Motz and Prager each held 21,661 unvested RSUs; Mr. Pincus held 27,678 unvested RSUs; and Ms. Fabiano and Mr. Jarvis held 31,189 unvested RSUs.