Patrick Kelly
About Patrick Kelly
Patrick Kelly is Co-President and Chief Operating Officer of Cipher Mining Inc., serving as COO since August 2021 and Co-President since March 2023; he is 46, a CFA charterholder, and holds a B.S. in Finance from DePaul University . Company performance context during his recent tenure: cumulative TSR increased ~364% from Jan 1, 2023 to Dec 31, 2024 (per pay-versus-performance disclosure) . The 2025 proxy also identifies him among named executive officers with tenure and biography consistent with the above .
Past Roles
| Organization | Role | Years | Strategic Impact |
|---|---|---|---|
| Stone Ridge Asset Management | Chief Operating Officer | 2012–2019 | Helped build and operate a fintech/asset management platform |
| Stone Ridge Trusts (multiple) | Director | 2012–2018 | Governance roles across Stone Ridge trust entities |
| Magnetar Capital | COO, Quantitative Strategies | 2009–2012 | Scaled quant strategies operations |
| D. E. Shaw & Co. | Head of Portfolio Valuation | N/A | Led valuation function for complex portfolios |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Stone Ridge Trusts (multiple) | Director | 2012–2018 | Prior external directorships (not current) |
Fixed Compensation
| Year | Base Salary ($) | Target Bonus (% of Salary) | Actual Bonus ($) | Notes |
|---|---|---|---|---|
| 2024 | 525,000 | 75% target; up to 150% at committee discretion | 787,500 | Committee awarded 150% of salary for 2024 based on milestones, hash rate growth, site acquisitions, and capital strategy |
| 2023 | 362,500 (reflects mid-year salary increase to 525k annualized in H2) | Not specified for 2023; annual/discretionary bonuses paid | 1,242,083 (includes 2023 annual bonus and discretionary cash bonuses paid in 2023) | Base increased effective July 1, 2023 to 525k |
Performance Compensation
Annual Cash Bonus (2024 Outcomes)
| Metric/Criteria | Weighting | Target | Actual/Payout | Vesting/Timing |
|---|---|---|---|---|
| Company and individual performance (milestones, hash rate growth, site acquisitions, capital strategy) | Discretionary (not formulaic) | 75% of salary target | 150% of salary paid (i.e., $787,500) | Paid Jan 15, 2025 |
Equity Awards and Vesting
| Grant | Type | Grant Date | Amount (Patrick Kelly) | Vesting | Performance Metrics | CIC/Termination Treatment |
|---|---|---|---|---|---|---|
| March 2024 RSUs | RSU (service-based) | 2024-03-09 | 1,410,658 RSUs | Equal tranches on Dec 18, 2024; Jan 1, 2026; Jan 1, 2027, subject to service | N/A | Full acceleration if terminated without cause/for good reason/death/disability; if not assumed in CIC, vests immediately prior; if assumed and later terminated not for cause or resign for good reason, vests at termination |
| Feb 2025 RSUs | RSU (service-based) | 2025-02-26 | 407,609 RSUs | Equal quarterly installments over 3 years (first on Mar 31, 2025) subject to service | N/A | Same construct as above (full acceleration upon qualifying termination; CIC “assume-or-vest” protections) |
| Feb 2025 PSUs | PSU (performance + time) | 2025-02-26 | 407,609 PSUs at target | 1/3 of earned PSUs vest at certification; remaining 2/3 vest quarterly over next 2 years, subject to service | FY2025 relative TSR vs S&P Americas SmallCap Software & Services Index; absolute TSR modifier | If CIC during performance period: target deemed earned; if after, earned based on actual; in either case, earned PSUs fully vest upon qualifying termination (not for cause / good reason) |
Equity Value in Summary Compensation
| Year | Stock Awards ($ grant-date fair value) |
|---|---|
| 2024 | 4,457,679 |
| 2023 | 1,300,000 |
Equity Ownership & Alignment
Beneficial Ownership
| As-of Date | Shares Beneficially Owned (Patrick Kelly) | % of Outstanding |
|---|---|---|
| 2025-09-12 | 1,089,260 | “*” less than 1% per table |
| 2025-04-08 | 1,030,792 | “*” less than 1% per table |
- Company anti-hedging/anti-pledging policy prohibits hedging transactions and pledging Company securities as collateral (subject to specified exceptions) .
- Clawback policy compliant with Nasdaq and Rule 10D-1 applies to current and former executive officers .
Vested vs Unvested (as of FY-end 2024)
| Award | Unvested Units | Market Value at 12/31/2024 ($4.64/share) |
|---|---|---|
| March 2024 RSUs | 940,440 | 4,363,642 |
| June 14, 2023 RSUs | 333,334 (vests 6/14/2025 & 6/14/2026) | 1,546,670 |
| Sep 13, 2022 Special Retention RSUs | 366,667 (vests 9/13/2025) | 1,701,335 |
Employment Terms
- Agreement: Executive Employment Agreement effective May 11, 2021; term through May 11, 2025 with automatic annual renewal unless either party gives non-renewal notice .
- Severance on termination without cause / resignation for good reason / non-renewal: 12 months’ base salary (lump sum if termination within 12 months after a change in control), pro-rated annual bonus based on actual performance, and Company-paid share of COBRA premiums for 12 months; subject to release and covenants .
- Restrictive covenants: 1-year post-termination non-compete and non-solicit; confidentiality and IP assignment .
- Clawback: Compensation Recoupment Policy in place per Nasdaq/Rule 10D-1 .
- Hedging/Pledging: Insider Trading Policy prohibits hedging and pledging transactions (specified exceptions) .
Compensation Structure Observations
- Mix shift to performance equity in 2025: 50% RSUs / 50% PSUs for NEOs, with PSUs tied to relative TSR plus absolute TSR modifier; vesting includes post-certification time-based components to promote retention .
- Annual cash bonus 2024 awarded at maximum (150% of salary) for non-CEO NEOs based on qualitative strategic and operational achievements (hash rate growth, site acquisitions, capital strategy) .
- Consultants and benchmarking: Compensation Committee engaged Pay Governance (2024) and Semler Brossy (2024–2025) and used peer market data to set 2025 program; Committee determined independence of consultants .
Governance, Say‑on‑Pay, and Shareholder Signals
- 2025 Say‑on‑Pay vote passed: 157,212,425 FOR; 60,642,805 AGAINST; 1,206,310 ABSTAIN; 45,894,567 broker non-votes .
- Board committees and membership disclosed; Compensation Committee chaired by Robert Flatley in 2024 .
- Beneficial ownership: Patrick Kelly remains under 1% ownership; management and directors as a group 2.89% as of April 8, 2025 .
Performance & Track Record Signals
- Pay-versus-performance shows alignment primarily via equity-driven value: compensation actually paid moved with stock price; cumulative TSR rose ~364% over 2023–2024 period while net losses continued (driven by sector dynamics and growth investments per filings) .
- Bonus rationale cited operational execution: growth in hash rate, successful large site acquisitions, and capital strategy management .
Investment Implications
- Alignment: 2025 program adds PSUs tied to relative/absolute TSR, increasing pay-for-performance sensitivity vs prior service-heavy RSUs; continued heavy equity weighting should align with shareholder outcomes .
- Retention and overhang: Time-based RSUs with multi-year schedules plus PSU post-certification vesting support retention; however, full RSU acceleration upon qualifying termination (even absent CIC) can weaken lock-in and may elevate separation negotiation leverage .
- Selling pressure: Material scheduled vesting dates (quarterly RSUs from 2025 and specific 2026/2027 dates) could create periodic liquidity windows; company prohibits hedging/pledging, mitigating alignment concerns; lack of disclosed pledging for Kelly reduces collateral-driven sale risks .
- Severance/CIC economics: One-year salary severance (lump-sum if within 12 months post-CIC) with equity acceleration protections results in moderate change-in-control costs and standard double-trigger equity vesting if awards are assumed .
- Shareholder support: 2025 say-on-pay approval with substantial FOR votes indicates tolerance for the equity-rich program amidst growth and TSR improvement .
Sources: 2025 Definitive Proxy (Apr 21, 2025) for compensation, ownership, policies; 2023 8-K (Mar 20, 2023) for background/appointments; 2025 8-K (Jun 9, 2025) for vote results; 2025 Special Meeting Proxy (Oct 6, 2025) for updated ownership.