☐ | | | Preliminary Proxy Statement |
☐ | | | Confidential, for Use of the Commission Only (as permitted by Rule 14a-6(e)(2)) |
☒ | | | Definitive Proxy Statement |
☐ | | | Definitive Additional Materials |
☐ | | | Soliciting Material under §240.14a-12 |
☒ | | | No fee required |
☐ | | | Fee paid previously with preliminary materials |
☐ | | | Fee computed on table in exhibit required by Item 25(b) per Exchange Act Rules 14a-6(i)(1) and 0-11 |
1. | the election of three Class I directors to serve until our annual meeting of stockholders to be held in 2027, or until their successors are duly elected and qualified, or until their earlier death, resignation, or removal; |
2. | the ratification of the appointment of Marcum LLP as our independent registered public accounting firm for the year ending December 31, 2024; |
3. | the approval, on a non-binding advisory basis, of the frequency of future stockholder advisory votes to approve the compensation of our named executive officers; and |
4. | the approval of an amendment to our Amended and Restated 2018 Equity Incentive Plan (our “2018 Plan”) to increase the number of shares of our common stock, par value $0.0001 per share, reserved under our 2018 Plan by 15,000,000, or from 30,000,000 shares to 45,000,000 shares. |
| | By Order of the Board of Directors: | |
| | ||
| | /s/ Fred Thiel | |
| | Fred Thiel | |
| | Chief Executive Officer and Chairperson of the Board |
Q: | When and where will the Annual Meeting be held? |
A: | The Annual Meeting will be held on Thursday, June 27, 2024, at 8:00 a.m. Pacific Time. The Annual Meeting will be conducted entirely online via a live webcast. Our stockholders may participate in the Annual Meeting by visiting: www.virtualshareholdermeeting.com/MARA2024. You will need a 16-digit control number to attend and participate in the live webcast of the Annual Meeting. Please refer to the question titled “How can I vote my shares?” for information on obtaining your 16-digit control number. |
Q: | What proposals am I being asked to vote upon at the Annual Meeting? |
A: | The proposals to be voted upon at the Annual Meeting, and our Board’s recommendation with respect to each proposal, are as follows: |
Proposal Number | | | Proposal | | | Board Voting Recommendation |
Proposal No. 1 | | | Elect three Class I directors to serve until our annual meeting of stockholders to be held in 2027, or until their successors are duly elected and qualified, or until their earlier death, resignation, or removal | | | “FOR” EACH DIRECTOR NOMINEE |
Proposal No. 2 | | | Ratify the appointment of Marcum LLP as our independent registered public accounting firm for the year ending December 31, 2024 | | | “FOR” |
Proposal No. 3 | | | Approve, on a non-binding advisory basis, of the frequency of future stockholder advisory votes to approve the compensation of our named executive officers | | | FOR EVERY “THREE YEARS” |
Proposal No. 4 | | | Approve an amendment to our Amended and Restated 2018 Equity Incentive Plan (our “2018 Plan”) to increase the number of shares of our common stock, par value $0.0001 per share (our “Common Stock”) reserved under our 2018 Plan by 15,000,000, or from 30,000,000 shares to 45,000,000 shares | | | “FOR” |
Q: | Why am I receiving these proxy materials? |
A: | We are making these proxy materials available in connection with the solicitation by our Board of proxies to be voted at the Annual Meeting, and at any adjournments or postponements thereof. This Proxy Statement contains important information for you to consider when deciding how to vote on the matters brought before the Annual Meeting. You are invited to virtually attend the Annual Meeting to vote on the proposals described in this Proxy Statement. However, you do not need to attend the Annual Meeting to vote your shares. Instead, you may vote your shares using one of the other voting methods described in this Proxy Statement. |
Q: | Why did I receive a notice in the mail regarding the Internet availability of proxy materials? |
A: | Instead of mailing printed copies to each of our stockholders, we have elected to provide access to the proxy materials over the internet under the SEC’s “notice and access” rules. These rules allow us to make our stockholders aware of the Annual Meeting and the availability of the proxy materials by sending a Notice of Internet Availability of Proxy Materials which provides instructions on how to access the full set of proxy materials through the Internet or make a request to have printed proxy materials delivered by mail. Accordingly, on or about April 29, 2024, we mailed the Notice to each of our stockholders. The Notice contains instructions on how to access the proxy materials, including this Proxy Statement and our Annual Report on Form 10-K for the year ended December 31, 2024 (our “Annual Report”), each of which are available at www.proxyvote.com. The Notice also provides instructions on how to vote your shares. |
Q: | Who can vote at the Annual Meeting? |
A: | Only our stockholders at the close of business on April 29, 2024 (the “Record Date”) will be entitled to virtually attend and vote at the Annual Meeting. On the Record Date, there were 272,924,506 shares of our Common Stock outstanding and entitled to vote. Each share of Common Stock issued and outstanding on the Record Date is entitled to one vote on any matter to be voted upon by our stockholders at the Annual Meeting. |
• | Holders of Record: If, on the Record Date, your shares were registered directly in your name with our transfer agent, Equity Stock Transfer LLC, then you are a “holder of record.” As a holder of record, you may vote at the Annual Meeting, or you may vote by proxy. If you are a holder of record and you indicate when voting that you wish to vote as recommended by our Board, or if you submit a vote by proxy without giving specific voting instructions, then the proxyholders will vote your shares as recommended by our Board on all matters described in this Proxy Statement. Fred Thiel and Salman Khan, the designated proxyholders, are members of our management. |
• | Beneficial Owners: If, on the Record Date, your shares were held in an account at a bank, broker, dealer, or other nominee, then you are the “beneficial owner” of shares held in “street name” and this Proxy Statement is being made available to you by that nominee. The nominee holding your account is considered the holder of record for purposes of voting at the Annual Meeting. As a beneficial owner, you have the right to direct your nominee on how to vote the shares in your account. You are also invited to virtually attend the Annual Meeting. However, since you are not the holder of record, you may not vote your shares at the Annual Meeting unless you request and obtain a valid “legal proxy” or obtain a 16-digit control number from your nominee. Please contact your nominee directly for additional information. |
Q: | What are “broker non-votes”? |
A: | If you are a beneficial owner of shares held in a brokerage account and you do not instruct your broker, bank or other agent how to vote your shares, your broker, bank or other agent may still be able to vote your shares in its discretion. Under the rules of the New York Stock Exchange (“NYSE”), which are also applicable to Nasdaq-listed companies, brokers, banks and other securities intermediaries that are subject to NYSE rules may use their discretion to vote your “uninstructed” shares on matters considered to be “routine” under NYSE rules but not with respect to “non-routine” matters. A “broker non-vote” occurs when a broker, bank or other agent has not received voting instructions from the beneficial owner of the shares and the broker, bank or other agent cannot vote the shares because the matter is considered “non-routine” under NYSE rules. |
Q: | What is the quorum requirement for the Annual Meeting? |
A: | The presence at the Annual Meeting, virtually (even if not voting) or by proxy, of the holders of 33-1/3% of the outstanding shares of Common Stock at the Annual Meeting, will constitute a quorum at the Annual Meeting. We will treat shares of Common Stock represented by a properly voted proxy, including shares for which authority is withheld or that a stockholder abstains from voting, as well as broker non-votes, as present at the Annual Meeting for the purposes of determining the existence of a quorum. If a quorum is not present, the Annual Meeting will be adjourned until a quorum is obtained. |
Q: | What are the voting requirements to approve each of the proposals, and what happens if I do not vote? |
A: | The voting requirements to approve each of the proposals to be voted upon at the Annual Meeting, as well as the effects of abstentions and broker non-votes on each of the proposals, are as follows: |
Proposal | | | Voting Requirement | | | Effect of Abstentions | | | Effect of Broker Non-Votes |
Proposal No. 1: Election of Class I Directors | | | Each director nominee will be elected by a plurality of the votes of the shares present in person or represented by proxy at the Annual Meeting and entitled to vote on the election of directors (assuming that a quorum is present). A “plurality of the votes” means that the three director nominees receiving the highest number of votes at the Annual Meeting will be elected. | | | A “WITHHOLD” vote with respect to a director nominee will not count as a vote cast for that or any other nominee, and thus will have no effect on the outcome of the vote on this proposal. | | | Broker non-votes will not count as votes cast on this proposal, and will have no effect on the outcome of the vote on this proposal. |
| | | | | | ||||
Proposal No. 2: Ratification of Appointment of Accounting Firm | | | Requires the affirmative vote of a majority of the votes cast (assuming that a quorum is present). | | | An “ABSTAIN” vote will have no effect on the outcome of the vote on this proposal. | | | Because a bank, broker, dealer or other nominee may generally vote without instructions on this proposal, we do not expect any broker non-votes to result for this proposal. |
| | | | | | ||||
Proposal No. 3: Advisory Vote on the Frequency of Future Advisory Votes on Executive Compensation | | | Stockholders may select every “One Year,” “Two Years” or “Three Years” with respect to this proposal. The option that receives the affirmative vote of a majority of the votes cast will be deemed to be the frequency preferred by our stockholders, (assuming that a quorum is present). | | | An “ABSTAIN” vote will have no effect on the outcome of the vote on this proposal. | | | Broker non-votes will not count as votes cast on this proposal, and will have no effect on the outcome of the vote on this proposal. |
| | | | | |
Proposal | | | Voting Requirement | | | Effect of Abstentions | | | Effect of Broker Non-Votes |
Proposal No. 4: Approval of Amendment to our 2018 Plan | | | Requires the affirmative vote of a majority of the votes cast (assuming that a quorum is present). | | | An “ABSTAIN” vote will have no effect on the outcome of the vote on this proposal. | | | Broker non-votes will not count as votes cast on this proposal, and will have no effect on the outcome of the vote on this proposal. |
Q: | Could other matters be decided at the Annual Meeting? |
A: | As of the date of this Proxy Statement, we are not aware of any business to be presented for consideration at the Annual Meeting other than the matters described in this Proxy Statement. If, however, other matters are properly presented at the Annual Meeting, the persons named as proxies will vote in accordance with their discretion with respect to those matters. |
Q: | How can I vote my shares? |
A: | Your shares can be voted as follows: |
• | Holders of Record: Holders of record can vote by proxy or by virtually attending the Annual Meeting where votes can be submitted electronically via live webcast. If you wish to vote by proxy, you can vote by Internet, telephone, or mail as described below. Whether or not you plan to attend the Annual Meeting, we encourage you to submit your proxy or voting instruction as soon as possible to ensure your representation at the Annual Meeting. |
| | Voting Method | |
| | To vote at the Annual Meeting by live webcast, please visit the following website: www.virtualshareholdermeeting.com/MARA2024. You will need the 16-digit control number included on the Notice or your proxy card (if you requested to receive printed proxy materials). The method you use to vote by proxy will not limit your right to virtually attend or vote at the Annual Meeting. All shares that have been properly voted and not revoked will be voted at the Annual Meeting. However, even if you plan to virtually attend the Annual Meeting, we recommend that you vote your shares in advance so that your vote will be counted if you later decide not to attend the Annual Meeting. | |
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| | To vote by Internet, you will need the 16-digit control number included on the Notice or your proxy card (if you requested to receive printed proxy materials). Internet voting is available 24 hours a day and will be accessible until 11:59 p.m. Eastern Time on Wednesday, June 26, 2024, by visiting www.proxyvote.com and following the instructions. | |
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| | To vote by telephone, you will need the 16-digit control number included on the Notice or on your proxy card (if you requested to receive printed proxy materials). Telephone voting is available 24 hours a day and will be accessible until 11:59 p.m. Eastern Time on Wednesday, June 26, 2024, by calling 1 (800) 690-6903 and following the instructions. | |
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| | To vote by mail, follow the instructions provided on your proxy card (if you requested to receive printed proxy materials). Simply mark, sign and date your proxy card and return it promptly in the postage-paid envelope provided. In order to be effective, completed proxy cards must be received by 11:59 p.m. Eastern Time on Wednesday, June 26, 2024. This option is only available if you requested to receive printed proxy materials. |
• | Beneficial Owners: If you are the beneficial owner of your shares, you should have received the Notice or a proxy card (if you requested to receive printed proxy materials) with this Proxy Statement from your bank, broker, or other agent rather than from us. Simply (i) use the 16-digit control number to vote on the Internet or by telephone before the Annual Meeting, or vote at the Annual Meeting, or (ii) if you requested to receive printed proxy materials, vote by following the instructions provided on the proxy card you |
Q: | What can I do if I change my mind after I vote my shares? |
A: | You may change your vote at any time before the polls are closed at the Annual Meeting. |
• | Holders of Record: If you are a holder of record, you may change your vote by (i) providing written notice of revocation to Marathon Digital Holdings, Inc., 101 NE Third Avenue, Suite 1200, Fort Lauderdale, Florida 33301, Attention: Corporate Secretary, (ii) executing a subsequent proxy using any of the voting methods discussed above (subject to the deadlines for voting with respect to each method), or (iii) attending the Annual Meeting and voting electronically via live webcast. However, simply attending the Annual Meeting will not, by itself, revoke your proxy. |
• | Beneficial Owners: If you are a beneficial owner of your shares and you have instructed your nominee to vote your shares, you may change your vote by following the directions received from your nominee to change those voting instructions, or by attending the Annual Meeting and voting via live webcast, which can be accomplished as described above. |
Q: | Who is paying for the cost of this proxy solicitation? |
A: | We have hired D.F. King & Co., Inc. to assist in the solicitation of proxies for an estimated fee of $15,000, plus out-of-pocket expenses. The solicitation of proxies is made on behalf of our Board and all the expenses of soliciting proxies from stockholders will be borne by us. In addition to the solicitation of proxies by use of the internet and mail, our directors, officers, and employees may communicate with stockholders personally or by email, telephone, or otherwise for the purpose of soliciting such proxies. No additional compensation will be paid to any such persons for such solicitation, although we may reimburse them for reasonable out-of-pocket expenses incurred in connection with such solicitation. We will also, upon request, reimburse banks, brokers, dealers and other nominees for their reasonable out-of-pocket expenses in forwarding solicitation material to beneficial owners of shares held of record by such persons. |
Q: | How may I obtain an additional copy of the proxy materials? How may I reduce the number of copies our household receives? |
A: | We have adopted a procedure called “householding,” which the SEC has approved. Under this procedure, we are delivering a single copy of the Notice and, if applicable, this Proxy Statement and our Annual Report, to multiple stockholders who share the same address unless we have received contrary instructions from one or more of the stockholders. This procedure reduces our printing and mailing costs. Stockholders who participate in householding will continue to be able to access and receive separate proxy materials. Upon written or oral request, we will promptly deliver a separate copy of the Notice and, if applicable, this Proxy Statement and our Annual Report, to any stockholder at a shared address to which we delivered a single copy of any of these documents. To receive a separate copy of the Notice and, if applicable, this Proxy Statement or our Annual Report, or if you wish to receive separate copies in the future, please contact: Marathon Digital Holdings, Inc., 101 NE Third Avenue, Suite 1200, Fort Lauderdale, Florida 33301, Attention: Corporate Secretary, Telephone: 1 (800) 804-1690. |
Q: | Where can I find the voting results of the Annual Meeting? |
A: | We will announce preliminary voting results with respect to each proposal at the Annual Meeting. In accordance with SEC rules, final voting results will be published in a Current Report on Form 8-K within four (4) business days following the Annual Meeting, unless final results are not known at that time, in which case preliminary voting results will be published within four business days of the Annual Meeting and final voting results will be published once we know them. |
Q: | Where else can I find these proxy materials? |
A: | This Proxy Statement and the Annual Report are available on our website at mara.com in the SEC Filings section of the Investors tab. Other information contained on or accessed through our website does not constitute part of this Proxy Statement and you should not consider this other information in deciding how to vote your shares. References to our website address in this Proxy Statement are inactive textual references only. |
Q: | Whom should I contact with other questions? |
A: | If you have additional questions about this Proxy Statement or the Annual Meeting, or if you would like additional copies of this Proxy Statement, please contact: Marathon Digital Holdings, Inc., 101 NE Third Avenue, Suite 1200, Fort Lauderdale, Florida 33301, Attention: Legal Department, Telephone: 1 (800) 804-1690. |
Name | | | Age | | | Director Since | | | Position(s) |
Fred Thiel | | | 63 | | | April 24, 2018 | | | Chief Executive Officer and Chairperson of the Board (Class I Director) |
Kevin DeNuccio | | | 64 | | | January 19, 2021 | | | Class I Director |
Said Ouissal | | | 47 | | | August 6, 2021 | | | Class I Director |
Name | | | Age | | | Director Since | | | Position(s) |
Georges Antoun | | | 61 | | | May 20, 2021 | | | Class II Director |
Jay Leupp | | | 60 | | | May 20, 2021 | | | Class II Director |
Vicki Mealer-Burke | | | 62 | | | April 1, 2024 | | | Class III Director |
Douglas Mellinger | | | 59 | | | March 31, 2022 | | | Class III Director |
Name | | | Audit Committee | | | Compensation Committee | | | Nominating and Corporate Governance Committee |
Kevin DeNuccio | | | | | ✔ | | | ✔ | |
Said Ouissal | | | ✔ | | | | | ||
Sarita James(1) | | | ✔ | | | | | Chair | |
Georges Antoun | | | ✔ | | | Chair | | | ✔ |
Jay Leupp(2) | | | Chair | | | ✔ | | | ✔ |
Vicki Mealer-Burke | | | | | ✔ | | | ✔ | |
Douglas Mellinger(3) | | | | | | | ✔ |
(1) | Ms. James is not standing for reelection at the Annual Meeting, and as a result, will no longer be a member of our Audit Committee or Chair of our Nominating and Corporate Governance Committee following the Annual Meeting. |
(2) | Our Board has determined that Mr. Leupp is an “audit committee financial expert” under applicable SEC rules. |
(3) | Immediately following the Annual Meeting, Mr. Mellinger will serve as Chair of our Nominating and Corporate Governance Committee. |
• | serving as an independent and objective party to monitor our financial reporting process and internal control system and complaints or concerns relating thereto; |
• | meeting with our independent registered public accounting firm and our financial management to review the scope of the proposed audit for the current year and the audit procedures to be utilized, and at the conclusion thereof reviewing such audit, including any comments or recommendations of our independent registered public accounting firm; |
• | reviewing and approving the internal corporate audit staff functions, including (i) purpose, authority and organizational reporting lines; (ii) annual audit plan, budget and stalling; (iii) concurrence in the appointment, compensation and rotation of the internal audit management function; and (iv) results of internal audits; |
• | reviewing the financial statements contained in our annual reports and quarterly reports to stockholders with management and our independent registered public accounting firm to determine that our independent registered public accounting firm is satisfied with the disclosure and content of the financial statements to be presented to our stockholders; and |
• | reviewing with our management any financial information, earnings press releases and earnings guidance filed with the SEC or disseminated to the public, including any certification, report, opinion or review rendered by our independent registered public accounting firm. |
• | reviewing and approving our goals and objectives relevant to the compensation of our Chief Executive Officer, evaluating our Chief Executive Officer’s performance with respect to such goals, and, subject to existing contractual obligations, set our Chief Executive Officer’s compensation level based on such evaluation; |
• | considering our Chief Executive Officer’s recommendations with respect to other executive officers; |
• | evaluating our performance both in terms of current achievements and significant initiatives with long-term implications; |
• | assessing the contributions of individual executives and recommending to our Board levels of salary and incentive compensation payable to our executive officers; and |
• | reviewing our financial, human resources, and succession planning. |
• | setting qualification standards for director nominees; |
• | identifying, considering and nominating candidates for membership on our Board; |
• | developing, recommending and evaluating corporate governance standards and a code of business conduct and ethics applicable to the Company; |
• | implementing and overseeing a process for evaluating our Board, our Board committees, and overseeing our Board’s evaluation of our Chief Executive Officer and Chairperson of the Board; |
• | making recommendations regarding the structure and composition of our Board and Board committees; |
• | advising our Board on corporate governance matters and any related matters required by the federal securities laws; and |
• | assisting our Board in identifying individuals qualified to become Board members; recommending to our Board the director nominees for the next annual meeting of stockholders; and recommending to our Board director nominees to fill vacancies on our Board. |
• | the Class I directors are Fred Thiel, Kevin DeNuccio, and Said Ouissal, whose terms will expire at the Annual Meeting unless they are re-elected, and Sarita James, who is not standing for re-election and whose term will expire at the Annual Meeting; |
• | the Class II directors are Georges Antoun and Jay Leupp, whose terms will expire at the annual meeting of stockholders to be held in 2025; and |
• | the Class III directors are Vicki Mealer-Burke and Douglas Mellinger, whose terms will expire at the annual meeting of stockholders to be held in 2026. |
| | Year Ended December 31, | ||||
Category of Fees | | | 2023 | | | 2022 |
Audit Fees | | | $938,963 | | | $965,279 |
Audit-Related Fees | | | — | | | — |
Tax Fees | | | — | | | — |
All Other Fees | | | 144,200 | | | 139,050 |
Total: | | | $1,083,163 | | | $1,104,329 |
| | AUDIT COMMITTEE | |
| | Jay Leupp (Chair) | |
| | Said Ouissal | |
| | Georges Antoun | |
| | Sarita James |
Name and Address of Beneficial Owner | | | Amount and Nature of Beneficial Ownership (#) | | | Percent of Common Stock(1) |
Named Executive Officers and Directors: | | | | | ||
Fred Thiel (Chief Executive Officer and Chairperson of the Board)(2) | | | 962,159 | | | * |
James Crawford (Chief Operating Officer)(3) | | | 364,246 | | | * |
Salman Khan (Chief Financial Officer)(4) | | | 171,004 | | | * |
Ashu Swami (Chief Technology Officer)(5) | | | 168,177 | | | * |
Adam Swick (Chief Growth Officer)(6) | | | 139,934 | | | * |
Georges Antoun(7) | | | 95,890 | | | * |
Kevin A. DeNuccio(8) | | | 238,087 | | | * |
Sarita James(9) | | | 62,446 | | | * |
Jay Leupp(10) | | | 124,869 | | | * |
Vicki Mealer-Burke(11) | | | 1,000 | | | * |
Doug Mellinger(12) | | | 114,803 | | | * |
Said Ouissal(13) | | | 41,375 | | | * |
All Executive Officers and Directors as a Group (13 Persons)(14) | | | 2,597,241 | | | * |
5% Stockholders: | | | | | ||
Jane Street Group, LLC(15) 250 Vesey Street, 6th Floor New York, NY 10281 | | | 14,404,233.7 | | | 6.5% |
BlackRock, Inc.(16) 50 Hudson Yards New York, NY 10001 | | | 17,192,377 | | | 8.1% |
The Vanguard Group, Inc.(17) 100 Vanguard Blvd. Malvern, PA 19355 | | | 23,473,587 | | | 10.54% |
* | Percentage of shares beneficially owned does not exceed 1.0% of our outstanding shares of common stock. |
(1) | For purposes of this table, the percent of class is based upon 269,028,574 shares of our Common Stock issued and outstanding as of March 31, 2024. Restricted stock units which may be settled within 60 days of March 31, 2024, are deemed beneficially owned and outstanding for computing the percentage ownership of the person or entity holding such securities, but are not considered outstanding for computing the percentage ownership of any other person or entity. |
(2) | Mr. Thiel’s beneficial ownership includes direct ownership of (i) 654,699 shares of Common Stock and (ii) restricted stock units for 307,460 shares of Common Stock that may be settled within 60 days of March 31, 2024. |
(3) | Mr. Crawford’s beneficial ownership includes direct ownership of (i) 336,625 shares of Common Stock and (ii) restricted stock units for 27,621 shares of Common Stock that may be settled within 60 days of March 31, 2024. |
(4) | Mr. Khan’s beneficial ownership includes direct ownership of (i) 110,062 shares of Common Stock and (ii) restricted stock units for 60,942 shares of Common Stock that may be settled within 60 days of March 31, 2024. |
(5) | Mr. Swami’s beneficial ownership includes direct ownership of (i) 135,801 shares of Common Stock and (ii) restricted stock units for 32,376 shares of Common Stock that may be settled within 60 days of March 31, 2024. |
(6) | Mr. Swick’s beneficial ownership includes direct ownership of (i) 113,118 shares of Common Stock and (ii) restricted stock units for 26,816 shares of Common Stock that may be settled within 60 days of March 31, 2024. |
(7) | Mr. Antoun’s beneficial ownership reflects his direct ownership of 95,890 shares of Common Stock. |
(8) | Mr. DeNuccio’s beneficial ownership reflects his direct ownership of 238,087 shares of Common Stock. |
(9) | Ms. James’ beneficial ownership reflects her direct ownership of 62,446 shares of Common Stock. |
(10) | Mr. Leupp’s beneficial ownership includes direct ownership of 124,869 shares of Common Stock. |
(11) | Ms. Mealer-Burke’s beneficial ownership reflects her direct ownership of 1,000 shares of Common Stock. |
(12) | Mr. Mellinger’s beneficial ownership reflects his direct ownership of 114,803 shares of Common Stock. |
(13) | Mr. Ouissal’s beneficial ownership reflects his direct ownership of 41,375 shares of Common Stock. |
(14) | The amount beneficially owned by the directors and executive officers as a group consists of an aggregate of (i) 2,115,202 shares of Common Stock, and (ii) restricted stock units for 482,039 shares of Common Stock that may be settled within 60 days of March 31, 2024. |
(15) | This information is based solely on Amendment No. 1 to the Schedule 13G filed with the SEC on February 9, 2024, by Jane Street Group, LLC and its subsidiaries, Jane Street Capital, LLC, Janet Street Options, LLC and Jane Street Global Trading, LLC, filing together as a group. This stockholder has shared voting and dispositive power over all such shares. |
(16) | This information is based solely on Amendment No. 2 to the Schedule 13G filed with the SEC on January 25, 2024, by BlackRock, Inc. and its subsidiaries listed on Exhibit A thereto filing together as a group. This stockholder has sole voting power over 16,933,087 of such shares of Common Stock and sole dispositive power over all such shares of Common Stock. |
(17) | This information is based solely on Amendment No. 3 to the Schedule 13G filed with the SEC on February 13, 2024, by the Vanguard Group, including investment companies registered under the Investment Company Act of 1940 and other managed accounts. This stockholder has shared voting power over 391,605 of such shares of Common Stock, sole dispositive power over 22,888,751 of such shares of Common Stock, and shared dispositive power over 584,836 of such shares of Common Stock. |
Name and Address | | | Age | | | Date First Elected or Appointed | | | Position(s) |
Fred Thiel | | | 63 | | | April 24, 2018 | | | Chief Executive Officer and Chairperson of the Board (Class I) |
Salman Khan | | | 45 | | | June 14, 2023 | | | Chief Financial Officer |
James Crawford | | | 49 | | | March 1, 2013 | | | Chief Operating Officer |
John Lee | | | 56 | | | November 21, 2022 | | | Chief Accounting Officer |
Ashu Swami | | | 44 | | | December 20, 2021 | | | Chief Technology Officer |
Adam Swick | | | 34 | | | March 1, 2023 | | | Chief Growth Officer |
• | Named Executive Officers |
• | Compensation Philosophy and Objectives |
• | 2023 Compensation Considerations |
• | Compensation Consultant |
• | Peer Group |
• | Governance Practices and Polices |
• | Elements of Our 2023 Executive Compensation Program |
• | Employment / Severance / Change-in-Control Agreements |
• | Other Compensation Policies and Practices |
• | Executive Compensation Tables |
• | Compensation Risk Considerations |
• | Pay Ratio |
• | Director Compensation |
• | Equity Compensation Plan Information |
• | Fred Thiel, our Chief Executive Officer and Chairperson of the Board (Principal Executive Officer); |
• | Salman Khan, our Chief Financial Officer, who commenced employment with us on June 7, 2023 (Principal Financial and Accounting Officer); |
• | James Crawford, our Chief Operating Officer; |
• | Ashu Swami, our Chief Technology Officer; |
• | Adam Swick, our Chief Growth Officer; and |
• | Hugh Gallagher, our former Chief Financial Officer, who resigned on May 12, 2023. |
• | Pay-for-Performance: Ensure a significant portion of total compensation paid to our executives is tied to the achievement of Company financial, operational and strategic objectives that the committee believes are important for our growth and success. |
• | Reward Achievement: Award annual cash incentive compensation and long-term equity incentive compensation following a determination that our executives have driven the achievement of performance objectives critical to our business and to the creation of long-term stockholder value. |
• | Attract and Retain Executives: Attract executives with the background and experience necessary to lead our business and achieve our strategic objectives, and retain our talented executives by paying compensation that is attractive and competitive in our industry and in the marketplace generally. |
• | Align Interests with Stockholders: Directly align the interests of our executives with those of our stockholders by issuing a significant portion of the total compensation opportunity in the form of annual cash incentive compensation that is tied to the achievement of strategic objectives, and equity incentive compensation the value of which is directly tied to our stock price. |
• | Pay Compensation for Achievement of Strategic Objectives. The committee is guided by a pay-for-performance philosophy and seeks to design our executive compensation program in a manner that reflects alignment between the total compensation paid to our executive officers and our achievement of strategic objectives deemed critical to the growth and success of our business, and which the committee believes are the key drivers of stockholder value. In determining 2023 compensation, the committee gave significant weight to our actual 2023 performance against a number of financial, operational and strategic metrics both relative to our historical performance and to the performance of certain peer group companies. Specifically, the payouts under our annual cash incentive program and our long-term equity incentive compensation were determined based our performance relative to certain performance objectives, including increases in our stock price and market capitalization, exceeding our exahash rate targets, outperforming third-party pool operators, and strengthening our balance sheet. We believe the strong correlation between our achievement of these objectives and the compensation paid under our executive compensation program motivates the achievement of performance objectives, aligns the interests of our executive officers with those of our stockholders, and drives a highly accountable culture. |
• | Need to Retain Flexibility to Adapt to Market Conditions. We operate in a highly competitive industry and one that is characterized by rapid technological development, regulatory uncertainty, employee mobility and industry consolidation. In addition, similar to other companies in our industry, our stock price |
• | Equity Incentive Compensation Ensures Stockholder Alignment and Encourages Retention. To ensure the interests of our executives are aligned with those of our stockholders, a significant portion of the total compensation opportunity for our executives is issued in the form of equity incentive compensation. Historically, we have issued restricted stock units (“RSUs”) to our executives rather than other types of equity awards. Similar to other companies in our industry, we have historically experienced volatile stock prices, which can limit the utility of certain types of equity awards (e.g., stock options and stock appreciation rights) as compensation tools, especially where there is a significant focus on retaining executives. RSUs achieve the objective of aligning interests between executives and stockholders because the value of the awards is directly tied to the value of our stock price. At the same time, RSUs serve to retain our executives since they continue to have value even if our stock price declines, which could occur as a result of factors outside our control and potentially even in circumstances where we achieve strong business and financial performance. In addition, the RSUs we granted in 2023 fully vest over either a three-year period or a four-year period following the grant date, so the executives do not receive the full value of the awards unless they remain employed by us throughout the vesting period, which further advances our retention objectives. |
• | Role of Compensation Consultant and Peer Group. Commencing in December 2023, the committee engaged Compensia, Inc. (“Compensia”) to provide independent compensation advisory services directly to the committee, which included: (i) identifying a peer group of publicly traded companies, including companies in the bitcoin industry and within the technology industry more broadly, (ii) collecting compensation data from the peer group companies, and (iii) making recommendations to the committee regarding certain elements of compensation. While the committee believes it is important to remain informed about the compensation practices of peer group companies in order to remain competitive in the marketplace, the committee did not specifically benchmark total compensation to any other companies in setting compensation for 2023. The committee retained flexibility to pay compensation it deemed appropriate based on Company performance. |
• | No Formal Policies for Allocating Compensation. The committee has not established any formal policies or guidelines for allocating between long-term and currently paid compensation, or between cash and non-cash compensation. In determining the amount and mix of compensation elements, and whether each element provides the correct incentives in light of our compensation objectives, the committee relies on its judgment and experience, as well as input from its independent compensation consultant, rather than adopting a formulaic approach to compensation decisions. The committee believes this approach is prudent to ensure it retains the flexibility necessary to adapt to changes in our business and industry, and to remain competitive in the marketplace. |
• | Executive Officer Role in Compensation. The committee generally considers the recommendations of our Chief Executive Officer when making decisions regarding the compensation of our other executive officers. In addition, at the request of the committee, other senior management personnel may provide performance and compensation information to the committee to inform its compensation decisions. However, our executives are not permitted to be present during any deliberations and voting regarding their own compensation. Consistent with Nasdaq rules, the committee is ultimately responsible for approving the compensation paid to our executive officers. |
• | Consideration of Other Factors. In establishing our executive compensation program, the committee also considers a number of other factors, including our recent and projected financial performance, individual executive performance and contributions, executive hiring and retention considerations, evolving pay practices in our industry or primary geographic areas, and changes to our business and industry. |
• | Independent Compensation Committee. The committee is comprised solely of independent directors as defined under the SEC and Nasdaq rules. Compensation decisions impacting our executive officers are approved by the committee. |
• | Independent Compensation Committee Consultant. The committee elected to retain Compensia commencing in 2023. The committee believes the use of an independent consultant provides additional assurance that our compensation program is competitive in the marketplace, and reflective of our executive compensation philosophy and objectives. |
• | Pay-for-Performance Philosophy. While the payment of annual cash incentive compensation and the issuance of equity awards to our executives is ultimately discretionary, the awards are determined based on our performance relative to performance metrics deemed critical to our success and to our ability to drive long-term stockholders value. |
• | Long-Term Vesting Requirements. The equity incentive compensation granted to our executives typically vests over either a three-year period or a four-year period following the date of issuance, which is consistent with peer group pay practices and our executive retention objectives, except in limited circumstances where necessary to recruit or retain executives. |
• | Annual Executive Compensation Review. The committee conducts an annual review of our compensation philosophy and objectives. The committee also performs an annual review of the risks related to our compensation practices. Please refer to the section titled “—Compensation Risk Considerations” for additional information about our compensation risk assessment. |
• | No Special Retirement Plans. We do not offer, nor do we have plans to provide, pension arrangements, retirement plans or nonqualified deferred compensation plans or arrangements to our executive officers. |
• | No Special Health or Welfare Benefits. Our executive officers participate in the same company-sponsored health and welfare benefits programs as our other full-time, salaried employees. |
• | No Tax Gross Ups. We do not provide any tax reimbursement payments (including “gross-ups”) on any severance or change in control payments or benefits. |
• | Insider Trading Prohibited. We have adopted a policy pursuant to which our directors, executive officers and employees are prohibited from engaging in transactions involving our securities, or the securities of other companies with which we do business while aware of material nonpublic information. |
• | Hedging and Pledging Prohibited. We have adopted a policy that prohibits our directors, executive officers and employees from engaging in hedging transactions, engaging in short sales, pledging our securities as collateral, or holding securities in a margin account. |
• | Policy for the Recovery of Erroneously Awarded Compensation. We maintain a policy applicable to our executive officers that provides for the potential recovery of incentive-based compensation in the event of a financial restatement under certain circumstances. |
• | title, job responsibilities and tenure with us; |
• | individual executive performance, as measured against various strategic, operational and management objectives in each executive’s areas of expertise and responsibility; |
• | expectations for future contributions to the business and the ability to enhance stockholder value; |
• | base salaries paid to executives with similar titles and responsibilities within the peer group companies, and within the market generally; and |
• | retention considerations in light of factors such as title and areas of expertise. |
Name | | | Base Salary ($) |
Fred Thiel | | | 800,000 |
Salman Khan(1) | | | 309,000 |
James Crawford | | | 241,099 |
Ashu Swami | | | 300,000 |
Adam Swick | | | 285,312 |
Hugh Gallagher(2) | | | 197,894 |
(1) | Mr. Khan commenced employment with us on June 7, 2023. The base salary amount represents the pro-rated portion of his annual base salary ($475,000) for the period from commencement of his employment through December 31, 2023. |
(2) | Mr. Gallagher is our former Chief Financial Officer who resigned on May 12, 2023.The base salary amount represents the pro-rated portion of his annual base salary ($489,250) for the period from January 1, 2023 through May 12, 2023. |
• | our significant stock price, market capitalization and enterprise value increases during the year both in absolute terms and relative to the peer group companies; |
• | the annual cash incentive compensation paid by the peer group companies to executives with similar titles and levels of responsibility, as determined based on our review of compensation data provided by Compensia; |
• | our operational performance, including exceeding our exahash rate targets and outperforming third-party pool operators; |
• | our successful completion of an acquisition that efficiently expanded our capacity; |
• | the strength of our balance sheet at the end of the year, which was a reflection of our significant reduction in indebtedness and successful fundraising efforts; |
• | individual performance of our executives, as measured against various strategic, operational and management objectives; and |
• | our relatively low headcount relative to peer group companies, and the relative impact of each executive on our operational performance. |
Name | | | Cash Bonus Percentage (%) | | | Cash Bonus Amount ($) |
Fred Thiel | | | 225% | | | $1,800,000 |
Salman Khan(1) | | | 225% | | | $623,438 |
James Crawford | | | 150% | | | $463,500 |
Adam Swick | | | 150% | | | $450,000 |
Ashu Swami | | | 150% | | | $427,969 |
(1) | Mr. Khan commenced employment with us on June 7, 2023. The bonus amount represents the pro-rated portion for the period from commencement of his employment through December 31, 2023. |
• | our significant stock price, market capitalization and enterprise value increases during the year both in absolute terms and relative to the peer group companies; |
• | the value of the long-term equity incentive compensation paid by the peer group companies, as determined based on our review of compensation data provided by Compensia; |
• | our operational performance, including exceeding our exahash rate targets and outperforming third-party pool operators; |
• | our successful completion of an acquisition that efficiently expanded our capacity; |
• | the strength of our balance sheet at the end of the year, which was a reflection of our significant reduction in indebtedness and successful fundraising efforts; |
• | individual performance of our executives, as measured against various strategic, operational and management objectives; and |
• | our relatively low headcount relative to peer group companies, and the relative impact of each executive on our operational performance. |
Name | | | Number of RSUs (#)(1) | | | Value of RSUs ($) |
Fred Thiel | | | 1,642,229 | | | $22,400,000 |
Salman Khan | | | 975,073 | | | $13,300,000 |
James Crawford | | | 294,501 | | | $4,017,000 |
Ashu Swami | | | 381,896 | | | $5,209,063 |
Adam Swick | | | 285,924 | | | $3,900,000 |
(1) | The number of RSUs granted to each executive was equal to the value of the 2023 LTIP Award divided by the average closing price of our Common Stock for the 100 consecutive trading days prior to and including the grant date. |
• | the incentive compensation payment or award was based upon the achievement of financial reporting measures that were subsequently the subject of a restatement to correct an accounting error due to material noncompliance with any financial reporting requirement under the federal securities laws; |
• | a lower payment or award would have been made to such executive officer based upon the restated financial results; and |
• | the requirement to file the restatement was identified within three years after the date of the first public filing of the financial results that were subsequently the subject of the accounting restatement. |
Name and Principal Position | | | Year | | | Salary ($) | | | Cash Bonus Awards ($)(1) | | | RSU Awards ($)(2) | | | All Other Compensation ($)(3) | | | Total ($) |
Fred Thiel Chief Executive Officer and Chairperson of the Board | | | 2023 | | | 800,000 | | | 1,800,000 | | | 33,506,720 | | | 9,900 | | | 36,116,620 |
| 2022 | | | 677,749 | | | 562,500 | | | 5,869,183 | | | — | | | 7,109,432 | ||
| 2021 | | | 339,734 | | | 500,000 | | | 17,182,601 | | | — | | | 18,022,335 | ||
| | | | | | | | | | | | |||||||
Salman Khan(4) Chief Financial Officer | | | 2023 | | | 241,099 | | | 623,438 | | | 20,168,367 | | | 134,900(5) | | | 21,167,804 |
| | | | | | | | | | | | |||||||
James Crawford Chief Operating Officer | | | 2023 | | | 309,000 | | | 463,500 | | | 6,779,343 | | | 9,900 | | | 7,561,743 |
| 2022 | | | 287,500 | | | 225,000 | | | 4,572,860 | | | — | | | 5,085,360 | ||
| 2021 | | | 154,500 | | | 250,000 | | | 605,416 | | | — | | | 1,009,916 | ||
| | | | | | | | | | | | |||||||
Ashu Swami Chief Technology Officer | | | 2023 | | | 285,312 | | | 427,969 | | | 9,045,046 | | | 9,900 | | | 9,768,227 |
| 2022 | | | 263,542 | | | 206,250 | | | 1,308,238 | | | — | | | 1,778,030 | ||
| 2021 | | | 5,288 | | | — | | | 3,152,000 | | | — | | | 3,157,288 | ||
| | | | | | | | | | | | |||||||
Adam Swick Chief Growth Officer | | | 2023 | | | 300,000 | | | 450,000 | | | 6,528,194 | | | 9,900 | | | 7,288,094 |
| 2022 | | | 215,625 | | | 84,375 | | | 1,583,425 | | | — | | | 1,883,425 | ||
| | | | | | | | | | | | |||||||
Hugh Gallagher(6) Former Chief Financial Officer | | | 2023 | | | 197,894 | | | — | | | — | | | 794,045(7) | | | 991,939 |
| 2022 | | | 337,829 | | | 267,188 | | | 4,192,500 | | | — | | | 4,797,517 |
(1) | Amounts reflect cash bonus awards paid under our annual cash incentive program. While the cash bonus awards are determined based on our achievement relative to strategic objectives, they are ultimately discretionary in nature and do not qualify as “non-equity incentive plan awards” under SEC rules. The 2023 Cash Bonuses were paid in January 2024, but have been reported for 2023 as they relate to service to us during 2023. Please refer to the section titled “—Annual Cash Incentive Compensation” for additional information regarding our 2023 Cash Bonuses. |
(2) | Amounts reflect the grant date fair value of RSUs granted for service to us during the year computed in accordance with ASC Topic 718. Amounts are inclusive of the 2023 LTIP Awards, which were issued in January 2024, but have been reported for 2023 as they relate to services provided to us during 2023. Please refer to the section titled “—Long-Term Equity Incentive Compensation” for additional information regarding our 2023 LTIP Awards. The grant date value of the 2024 LTIP Awards is greater than the value reflected in that section because of the significant increase in our stock price during the period leading up to the grant date and the manner in which we are required to determine the grant date fair value under SEC rules. |
(3) | Except as otherwise noted, amounts reflect Company matching contribution under our 401(k) plan of up to 3% of total compensation (not to exceed a maximum annual contribution of $9,900 per employee). |
(4) | Mr. Khan commenced employment with us on June 7, 2023. The base salary amount represents the pro-rated portion of his annual base salary ($475,000) for the period from commencement of his employment through December 31, 2023. |
(5) | Amount reflects a one-time sign on bonus paid upon commencement of employment ($125,000), and a Company matching contribution under our 401(k) plan ($9,900). |
(6) | Mr. Gallagher resigned from his employment with us on May 12, 2023. |
(7) | This amount reflects a cash severance payment and the value of accrued and unpaid PTO. Please refer to the section titled “—Severance Agreements” for a discussion of the severance payments made to Mr. Gallagher in connection with his resignation. |
Named Executive Officer | | | Grant Date(1) | | | Number of RSUs Granted (#) | | | Grant Date Fair Value of RSU Awards ($)(2) |
Fred Thiel | | | May 1, 2023(3) | | | 500,000 | | | 4,390,000 |
| | January 31, 2024(4) | | | 1,642,229 | | | 29,116,720 | |
Salman Khan | | | June 14, 2023(5) | | | 297,247 | | | 2,880,323 |
| | January 31, 2024(4) | | | 975,073 | | | 17,288,044 | |
James Crawford | | | December 7, 2023(6) | | | 100,441 | | | 1,557,840 |
| | January 31, 2024(4) | | | 294,501 | | | 5,221,503 | |
Ashu Swami | | | December 7, 2023(6) | | | 146,617 | | | 2,274,030 |
| | January 31, 2024(4) | | | 381,896 | | | 6,771,016 | |
Adam Swick | | | March 1, 2023(6) | | | 166,817 | | | 1,085,979 |
| | December 7, 2023(7) | | | 24,035 | | | 372,783 | |
| | January 31, 2024(4) | | | 285,924 | | | 5,069,433 |
(1) | The RSUs granted in January 2024 reflect the 2023 LTIP Awards, which were granted for service to us during 2023. Please refer to the section titled “—Long-Term Equity Incentive Compensation” for additional information regarding our 2023 LTIP Awards. |
(2) | Amounts reflect the grant date fair value of RSUs granted for service to us during the year computed in accordance with ASC Topic 718. |
(3) | These RSUs vested as to 25% of the underlying shares on the first anniversary of the grant date, and vest as to the remaining shares in 12 equal quarterly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
(4) | These RSUs vest as to 25% of the underlying shares on the grant date, and vest as to the remaining shares in 12 equal quarterly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
(5) | These RSUs vested as to 25% of the underlying shares on July 1, 2024, and vest as to the remaining shares in 12 equal quarterly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
(6) | These RSUs were granted to Mr. Swick in connection with his promotion to Chief Growth Officer. These RSU vested as to 25% of the underlying shares on the first anniversary of the grant date, and vest as to the remaining shares in twelve equal quarterly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
(7) | These RSUs were granted based on our achievement of a pre-determined exahash rate target and were only granted to a limited number of employees that met minimum service requirements. These were one-time grants based on achieving a critical operational milestone, but no similar grants are contemplated. These RSU vest as to 25% of the underlying shares on the grant date, and vest as to the remaining shares in 12 equal quarterly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
| | Restricted Stock Units | |||||||||||||
Named Executive Officer | | | Grant Date | | | Number of RSUs That Have Not Yet Vested (#) | | | Market Value of RSUs That Have Not Yet Vested ($)(1) | | | Equity Incentive Plan Awards; Number of Unearned Shares, RSUs, or Other Rights That Have Not Vested (#)(2) | | | Equity Incentive Plan Awards; Market or Payout Value of Unearned Shares, RSUs, or Other Rights That Have Not Vested ($) |
Fred Thiel | | | October 4, 2021 | | | 83,300(3) | | | 1,956,717 | | | — | | | — |
| | May 1, 2023 | | | 500,000(4) | | | 11,745,000 | | | — | | | — | |
| | November 10, 2023 | | | 458,053(5) | | | 10,759,665 | | | — | | | — | |
| | January 31, 2024 | | | 1,231,672(5) | | | 28,931,976 | | | — | | | — | |
James Crawford | | | February 23, 2022 | | | 112,500(6) | | | 2,642,625 | | | — | | | — |
| | November 10, 2023 | | | 110,577(5) | | | 2,597,454 | | | — | | | — | |
| | December 7, 2023 | | | 75,331(5) | | | 1,769,525 | | | — | | | — | |
| | January 31, 2024 | | | 220,876(5) | | | 5,188,378 | | | — | | | — | |
Salman Khan | | | June 14, 2023 | | | 297,247(7) | | | 6,982,332 | | | — | | | — |
| | January 31, 2024 | | | 731,305(5) | | | 17,178,355 | | | — | | | — | |
Ashu Swami | | | December 27, 2021 | | | 40,000(4) | | | 939,600 | | | — | | | — |
| | November 10, 2023 | | | 102,100(5) | | | 2,398,329 | | | — | | | — | |
| | December 7, 2023 | | | 109,963(5) | | | 2,583,031 | | | — | | | — | |
| | January 31, 2024 | | | 286,422(5) | | | 6,728,053 | | | — | | | — | |
Adam Swick | | | July 29, 2022 | | | 23,000(8) | | | 540,270 | | | — | | | — |
| | March 1, 2023 | | | 166,817(4) | | | 3,918,531 | | | — | | | — | |
| | November 10, 2023 | | | 107,356(5) | | | 2,521,792 | | | — | | | — | |
| | December 7, 2023 | | | 18,026(5) | | | 423,431 | | | — | | | — | |
| | January 31, 2024 | | | 214,443(5) | | | 5,037,267 | | | — | | | — |
(1) | The market value of unvested RSU awards was calculated by multiplying the number of shares subject to such awards by the closing price of our Common Stock on December 29, 2023, which was $23.49. |
(2) | We have not issued any RSUs that remain unearned as all of our RSUs are subject to time-based vesting conditions upon issuance. |
(3) | These RSUs vested as to one-third of the underlying shares on April 26, 2022, and vest as to the remaining shares in eight equal quarterly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
(4) | These RSUs vested as to 25% of the underlying shares on the first anniversary of the grant date, and vest as to the remaining shares in 12 equal quarterly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates |
(5) | These RSUs vest as to 25% of the underlying shares on the grant date, and vest as to the remaining shares in 12 equal quarterly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
(6) | These RSUs vested as to 25% of the underlying shares on the first anniversary of the grant date, and vest as to the remaining shares in three equal quarterly installments of 25% thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
(7) | These RSUs vested as to 25% of the underlying shares on July 1, 2024, and vest as to the remaining shares in 12 equal quarterly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
(8) | These RSUs vested as to 25% of the underlying shares on September 30, 2022, and vest as to the remaining shares in 12 equal quarterly installments thereafter, subject to the executive’s continued service to us through the applicable vesting dates. |
| | Restricted Stock Units | ||||
Named Executive Officer | | | Aggregate Number of Shares Acquired on Vesting (#)(1) | | | Aggregate Value Realized on Vesting ($)(2) |
Fred Thiel | | | 319,284 | | | 3,300,726 |
Salman Khan | | | — | | | — |
James Crawford | | | 99,469 | | | 1,016,671 |
Ashu Swami | | | 90,687 | | | 1,193,411 |
Adam Swick | | | 53,294 | | | 593,982 |
Hugh Gallagher | | | 50,000 | | | 436,000 |
(1) | These shares do not include any portion of the 2023 LTIP Awards since they were not issued until January 2024. |
(2) | In accordance with SEC rules, the value realized is based on the closing price of our Common Stock on the applicable vesting dates. |
| | | | Type of Payment or Benefit | ||||||||
Named Executive Officer | | | Base Salary ($)(1) | | | Bonus ($)(2) | | | Value of Accelerated RSUs ($)(3) | | | Continuation of Benefits ($)(4) |
Fred Thiel | | | 800,000 | | | 800,000 | | | 24,461,382 | | | 10,992 |
Salman Khan | | | 1,187,500 | | | 475,000 | | | 6,982,332 | | | 8,190 |
James Crawford | | | 241,099 | | | 241,099 | | | 7,009,604 | | | 7,902 |
Ashu Swami | | | 150,000 | | | 300,000 | | | — | | | — |
Adam Swick | | | 285,312 | | | 285,312 | | | 7,404,025 | | | 8,289 |
(1) | Pursuant to the employment agreements, amounts generally reflect the greater of the executives’ base salary through the balance of the employment term, or 12 months. For each of Messrs. Thiel, Crawford and Swick, the amount reflects 12 months of base salary. For Mr. Khan, the amount reflects approximately 30 months of base salary. For Mr. Swami, the amount reflects six months of base salary. |
(2) | Pursuant to the employment agreements, amounts reflect the executives’ target bonus opportunity for the year calculated at 100% of base salary. However, the actual cash bonus payments earned each year may be different from this amount. |
(3) | Upon termination of employment under the circumstances discussed above, all outstanding stock options, RSUs and other equity awards immediately vest. Amounts reflect the market value of the RSU awards that would have vested as of December 31, 2023, which was calculated by multiplying the number of shares subject to such awards by the closing price of our Common Stock on December 29, 2023, which was $23.49. Amounts do not reflect the value of the 2023 LTIP Awards, which were granted on January 31, 2024. |
(4) | Amounts reflect the value of the executive’s continued participation in our welfare benefit plans for not less than 12 months for Mr. Thiel, and not less than nine months for Messrs. Khan, Crawford and Swick. |
• | The committee has retained an independent compensation consultant that reports directly to the committee. |
• | We review peer group compensation data to ensure our compensation program is competitive in light of market conditions and our compensation objectives. |
• | In determining the value of annual cash incentive compensation paid and equity incentive compensation awarded to our executives, the committee considers our actual performance relative to strategic objectives deemed critical to our success and to the creation of long-term stockholder value. |
• | The committee regularly assesses and modifies the strategic objectives on which compensation decisions are based to ensure our compensation program encourages sustained growth across our business, and is able to adapt to the unique and dynamic industry in which we operate. |
• | Our equity incentive compensation program encourages executive retention through long-term vesting provisions. |
• | Our Policy for the Recovery of Erroneously Awarded Compensation provides for the recovery of incentive-based compensation in connection with a financial restatement. |
• | Our Statement of Policies and Procedures Governing Material Nonpublic Information and the Prevention of Insider Trading prohibits our employees, executive officers and directors from engaging in derivative securities transactions, engaging in short sales of our securities, pledging our securities as collateral, or holding our securities in a margin account. |
• | Our employment agreements include severance and change in control benefits that are designed to attract and retain executives without providing excessive benefits such as excise tax gross up payments. |
• | chairperson of the audit committee, $40,000; |
• | audit committee member other than the chair, $20,000; |
• | chairperson of the compensation committee, $40,000; |
• | compensation committee member other than the chairperson, $20,000; |
• | chairperson of the nominating and governance committee, $40,000; and |
• | nominating and governance committee member other than the chair, $20,000. |
Name | | | Year | | | Fees Earned or Paid in Cash ($) | | | RSU Awards ($)(1) | | | All Other Compensation ($) | | | Total ($) |
Jay Leupp | | | 2023 | | | 155,000 | | | 1,100,000 | | | — | | | 1,255,000 |
Georges Antoun | | | 2023 | | | 155,000 | | | 1,100,000 | | | — | | | 1,255,000 |
Kevin DeNuccio | | | 2023 | | | 95,000 | | | 1,100,000 | | | — | | | 1,195,000 |
Said Ouissal | | | 2023 | | | 110,000 | | | 1,100,000 | | | — | | | 1,210,000 |
Sarita James(2) | | | 2023 | | | 130,000 | | | 1,100,000 | | | — | | | 1,230,000 |
Doug Mellinger | | | 2023 | | | 85,000 | | | 1,100,000 | | | — | | | 1,185,000 |
(1) | Amounts reflect the grant date fair value of the RSUs granted for service to us during the year computed in accordance with ASC Topic 718. A portion of the RSU awards were granted in January 2024, but were granted to the directors for service to us during 2023. |
(2) | Ms. James is not standing for re-election at the Annual Meeting. |
| | Number of Securities to be Issued Upon Exercise of Outstanding Options, Warrants and Rights(2) (#) (a) | | | Weighted Average Exercise Price of Outstanding Options, Warrants and Rights ($) (b) | | | Number of Securities Remaining Available for Future Issuance Under Equity Compensation Plans (Excluding Securities Reflected in Column (a) (#) (c) | |
Plan Category(1) | | | | | | | |||
Equity compensation plans approved by stockholders | | | 5,765,529(2) | | | —(3) | | | 11,896,749(4) |
Equity compensation plans not approved by stockholders | | | — | | | — | | | — |
Total | | | 5,765,529 | | | 11,896,749 | | |
(1) | The equity compensation plans previously approved by our stockholders include the 2012 Equity Incentive Plan, 2014 Equity Incentive Plan, 2017 Equity Incentive Plan and 2018 Equity Incentive Plan (collectively, the “Equity Plans”). We do not have any equity compensation plans that have not been approved by our stockholders. |
(2) | Amount reflects shares underlying RSU awards previously issued pursuant to the 2018 Plan that remained outstanding as of December 31, 2023. There are no equity awards that remain outstanding pursuant to any of the other Equity Plans as of December 31, 2023. |
(3) | No stock options, stock appreciation rights or warrants have been issued pursuant to the terms of the Equity Plans. We have only issued RSUs pursuant to the terms of the Equity Plans, which do not have an exercise price. |
(4) | Amount reflects the number of shares that remain available for issuance under the 2018 Plan, which is the only Equity Plan approved by our stockholders pursuant to which we are authorized to continue to issue new equity awards. |
| | BY ORDER OF THE BOARD OF DIRECTORS | |
| | ||
| | /s/ Fred Thiel | |
| | Fred Thiel | |
| | Chief Executive Officer and Chairperson of the Board |
1. | Section 4 of the Plan is hereby amended in its entirety to read as follows: |
2. | Except as expressly set forth above, the terms and conditions of the Plan shall remain unchanged by this Amendment and the Plan shall remain in full force and effect in accordance with its terms. |
| | MARATHON DIGITAL HOLDINGS, INC. | ||||
| | | | |||
| | |||||
| | Name: | | | Fred Thiel | |
| | Title: | | | Chief Executive Officer and Chairperson of the Board |