Kenneth Cragun
Alzamend NeuroAbout Kenneth Cragun
Kenneth S. Cragun (age 64) serves as Senior Vice President of Finance at Alzamend Neuro (ALZN). He joined the company on a part-time basis in December 2018 and holds a B.S. in Accounting from Colorado State University–Pueblo . Company performance context during his tenure shows negative net income and no reported revenue in the “Pay Versus Performance” table (total revenue shown as “-”), while the TSR proxy table indicates severe share price underperformance (value of an initial $100 investment fell to $0.49 in FY2024, from $10.63 in FY2022) .
Key performance metrics (company-level context):
- Net income (loss): FY2022 $(12,362,059); FY2023 $(14,878,167); FY2024 $(9,947,746)
- Total shareholder return (value of $100): FY2022 $10.63; FY2023 $5.70; FY2024 $0.49
- Total revenue: not reported (displayed as “-”) in FY2022–FY2024
Past Roles
| Organization | Role | Years | Strategic Impact/Notes |
|---|---|---|---|
| Ault Disruptive Technologies Corporation | Chief Financial Officer | Feb 2021 – Oct 2024 | Public-company CFO experience; finance leadership |
| Hyperscale Data, Inc. | CFO; previously Chief Accounting Officer | CFO since Aug 2020; CAO Oct 2018 – Aug 2020 | Current CFO role at related-party affiliate |
| Hardesty, LLC | CFO Partner | Oct 2016 – Oct 2018 | Interim CFO assignments (e.g., CorVel, RISA Tech) |
| Local Corporation (Nasdaq) | Chief Financial Officer | Apr 2009 – Sep 2016 | Public-company CFO; company later filed Ch. 11 in 2015 while he was CFO |
| Modtech Holdings, Inc. (Nasdaq) | Chief Financial Officer | Jun 2006 – Mar 2009 | Public-company CFO |
| Prior roles (MIVA, ImproveNet, NetCharge, C‑Cube, 3Com, Deloitte) | Finance leadership; Auditor | Various | Progressive finance roles; began career at Deloitte |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Verb Technology Company, Inc. | Director; Chair of Audit Committee | Since Sep 2018 | Current public company board service |
| Algorhythm Holdings, Inc. (RIME) | Director | Jul 2022 – Sep 2024 | Recent public company directorship |
Fixed Compensation
| Component | Terms | Source |
|---|---|---|
| Base Salary | $100,000 per year, to increase to $120,000 upon national exchange listing approval (offer letter, Nov 2018) | |
| Target Bonus % | Eligible for annual cash bonus as a % of base salary based on Board-set performance goals; specific target % not disclosed | |
| Actual Bonus | Not disclosed for Mr. Cragun (not a named executive officer in FY2024 SCT) |
Performance Compensation
| Instrument | Grant Details | Vesting/Performance | Status/Notes |
|---|---|---|---|
| Stock Options | 1,500,000 options at $1.00 strike; 10-year term from Dec 15, 2018 | Vests ratably over 48 months from Dec 15, 2018; 500,000 vested immediately upon national exchange listing approval | Historic grant; current exercisability reflected in beneficial ownership table only as options exercisable within 60 days (see ownership) |
| Performance/Market-Contingent Options | 1,000,000 options at $1.50 strike (Nov 2019) | Multiple market triggers: stepped target closing prices ($15–$40) for 90 consecutive trading days later than 180 days post-IPO, or change-in-control price triggers; if milestones not achieved within 3 years, unvested portion reduced by 25% | Historic structure indicates strong stock-price linkage; current vesting achievement not disclosed |
Equity Ownership & Alignment
| Metric | Value | Source |
|---|---|---|
| Total beneficial ownership (shares) | 10,000 shares (all represented as options currently exercisable or exercisable within 60 days) | |
| Ownership as % of outstanding | Less than 1% | |
| Vested vs. unvested breakdown | Not disclosed (beneficial table indicates exercisable-within-60-days only) | |
| Shares pledged as collateral | Not disclosed | — |
| Stock ownership guidelines | Company has no formal stock ownership guidelines for employees/directors | |
| Hedging policy | Company has not adopted any hedging policies | |
| Insider trading controls | Insider trading policy with preclearance, blackout windows, and 10b5‑1 plan allowance described in detail |
Employment Terms
| Term | Disclosure | Source |
|---|---|---|
| Employment start date | Joined ALZN on a part-time basis in December 2018 | |
| Contract in force | The 2025 proxy states “Employment Agreements — None” (company-wide) | |
| Severance | Not disclosed for Mr. Cragun; no current employment agreement disclosed | |
| Change-of-control | Not disclosed for Mr. Cragun; no current employment agreement disclosed | |
| Clawback | No company-wide clawback policy disclosed in 2025 proxy; prior (2023) CEO agreement referenced clawback rights (PEO), not specific to Mr. Cragun | |
| Non-compete / Non-solicit / Garden leave | Not disclosed | — |
Additional Context: Related Parties and Risk Indicators
- Related-party ecosystem: Hyperscale Data and Ault Lending hold significant influence at ALZN; Hyperscale Data and Ault Lending positions are controlled by affiliates, and ALZN notes overlapping officers including Mr. Cragun as CFO of Hyperscale Data .
- Legal proceedings: As CFO of Local Corp., Mr. Cragun was an executive when the company filed Chapter 11 in June 2015 (disclosed under officer legal proceedings) .
- Governance policies: Insider trading compliance program and 10b5‑1 plan procedures are detailed in ALZN’s 10‑K exhibits .
- Company financial condition: Auditor going-concern emphasis and need for substantial additional funding for clinical programs; $3.9M cash at 4/30/2025 and additional $4.0M raised; still insufficient for 12 months under the plan .
Investment Implications
- Pay-for-performance alignment: Mr. Cragun’s historic equity awards are heavily stock-price contingent (multi-trigger market options with high price thresholds and time-based options), creating alignment with shareholder value creation; however, the company’s TSR record (value of $100: $10.63 in FY2022 to $0.49 in FY2024) indicates significant underperformance over recent years, implying those awards may not have paid out meaningfully to date .
- Ownership/retention risk: Direct beneficial ownership is limited (10,000 options currently exercisable within 60 days; <1% ownership), with no company stock ownership guidelines and no hedging policy—factors that may reduce long-term alignment or predictability of selling behavior; insider trading controls and 10b5‑1 plans mitigate information risk but not selling pressure per se .
- Contract protection: No current employment agreement and no disclosed severance or change-of-control protections for Mr. Cragun—potentially lower cost to transition but also less retention security for the executive .
- Related-party nexus: Concurrent CFO role at Hyperscale Data (a significant related party at ALZN) signals networked influence and potential conflicts that warrant monitoring for related-party transactions and governance discipline .
- Balance-sheet and dilution watch: Going-concern emphasis and funding needs suggest continued reliance on external capital (including preferred/warrants), which can heighten dilution and influence executive option incentive dynamics; monitor capital structure actions and their impact on historical grant economics .