Kenneth S. Cragun
About Kenneth S. Cragun
Kenneth S. Cragun is Chief Financial Officer (Principal Accounting Officer) of Hyperscale Data, Inc. (ticker: GPUS), serving as CFO since August 2020 following his tenure as Chief Accounting Officer from October 2018 to August 2020; he is 64 and holds a B.S. in Accounting from Colorado State University–Pueblo . He has signed the company’s Sarbanes-Oxley certifications (302/906) in recent filings, reflecting responsibility for disclosure controls and internal control over financial reporting . Company performance context during his tenure is provided in the tables below (revenues, EBITDA, and TSR); the proxy “Pay vs Performance” disclosures show weak TSR outcomes through 2023, with industry-peer benchmarking provided by the company .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Hyperscale Data, Inc. (formerly Ault) | Chief Financial Officer | Aug 2020–present | Promoted from Chief Accounting Officer; principal accounting officer; 302/906 certifications on filings . |
| Hyperscale Data, Inc. (formerly Ault) | Chief Accounting Officer | Oct 2018–Aug 2020 | Led accounting prior to CFO promotion . |
| Hardesty, LLC | CFO Partner (executive services) | Oct 2016–Oct 2018 | CFO assignments at CorVel and RISA Tech . |
| Local Corporation (NASDAQ: LOCM) | Chief Financial Officer | Apr 2009–Sep 2016 | Company later filed Chapter 11 in 2015 (disclosed in company filings) . |
| Modtech Holdings, Inc. | Chief Financial Officer | Jun 2006–Mar 2009 | Financial leadership . |
| Various (MIVA, ImproveNet, NetCharge, C-Cube Microsystems, 3-Com) | Finance leadership roles | n/d | Increasing responsibilities in finance . |
| Deloitte | Early career | n/d | Began professional career . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Verb Technology Company, Inc. (NASDAQ: VERB) | Director; Chair, Audit Committee | Since Sep 2018 | Board and audit leadership role . |
| MICS | Director | Since Jul 2022 | Board member . |
| Ault Disruptive (NYSE-listed SPAC, ADTC) | Chief Financial Officer | Since Feb 2021 | Concurrent CFO role . |
| Alzamend Neuro, Inc. | SVP Finance (part-time) | Since Jun 2021 | Prior CFO Dec 2018–Jun 2021 . |
Fixed Compensation
| Year | Base Salary ($) | Target Bonus % | Actual Bonus Paid ($) | All Other Compensation ($) | Total ($) |
|---|---|---|---|---|---|
| 2020 | 200,000 | n/d | 25,000 | 21,398 | 246,398 |
Notes:
- At appointment (Aug 20, 2020) the company disclosed no employment agreement and annual pay of $200,000 .
- As a Smaller Reporting Company, recent proxies include only the PEO and two other NEOs; CFO-specific 2024/2025 cash compensation detail was not included in the disclosed NEO tables .
Performance Compensation
Option awards disclosed for Mr. Cragun:
| Instrument | Grant date | Shares | Exercise price | Term | Vesting schedule | Performance linkage | Status/conditions |
|---|---|---|---|---|---|---|---|
| Stock options | Sep 6, 2022 | 15,000,000 | $0.29 | 10 years | 50% vests 1/48 monthly beginning Jan 1, 2023; 50% vests upon achievement of milestones set by Comp Committee | 50% milestone-based (details not disclosed) | Exercise/issuance subject to stockholder and NYSE American approval |
| Stock options | Jul 31, 2025 | 1,000,000 | $0.72 | 10 years | 50% vests upon stockholder approval; 50% vests monthly beginning Jan 1, 2026; exercisable upon NYSE American and stockholder approvals and the 2025 Plan | Time-based; no explicit performance metrics disclosed | Requires approvals; grant part of broader equity issuance proposal |
Board rationale for 2025 equity issuance emphasized retention amid underwater prior option grants and stock volatility; the package orients LTIs toward options to minimize dilution and restore retention value .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Total beneficial ownership | 0 shares; 0% of class as of record date in latest preliminary proxy . Also, Schedule 13D/A notes Mr. Cragun not deemed to beneficially own any Class A shares and reported no transactions in prior 60 days . |
| Vested vs. unvested shares | Not disclosed for CFO in recent fiscal-year-end outstanding awards table (table listed only EC/CEO/President) . |
| Options (exercisable/unexercisable) | Specific CFO outstanding/exercisable balances not disclosed; see grant terms above . |
| Pledging/hedging | Company states no formal stock ownership guidelines and permits 10b5-1 plans; 2023 10-K states no hedging policies adopted . |
| Ownership guidelines and compliance | “We do not have formal stock ownership guidelines for our employees or directors” . |
Employment Terms
| Term | Detail |
|---|---|
| Employment start date | CFO since August 2020; previously CAO Oct 2018–Aug 2020 . |
| Employment agreement | At appointment, no employment agreement and paid $200,000 annually . No subsequent CFO-specific employment agreement/severance disclosure identified in later filings. |
| Severance | Not disclosed for CFO; CEO/President severance terms are disclosed for context in proxy/10-K, but no CFO-specific terms provided . |
| Change-of-control | Not disclosed for CFO; CEO change-in-control terms disclosed, not applicable to CFO . |
| Clawback | NEO-specific clawback noted for President/GC (Nisser); no CFO-specific clawback disclosure identified . |
| Non-compete / non-solicit / garden leave | Not disclosed for CFO. |
Company Performance (context for pay-for-performance)
Revenues and EBITDA – last 8 quarters
| Metric | Q4 2023 | Q1 2024 | Q2 2024 | Q3 2024 | Q4 2024 | Q1 2025 | Q2 2025 | Q3 2025 |
|---|---|---|---|---|---|---|---|---|
| Revenues ($) | -19,000* | 27,673,000* | 25,579,000 | 25,486,000 | 14,656,000* | 22,632,000* | 21,888,000* | 21,544,000* |
| EBITDA ($) | -16,712,000* | 6,227,000* | -12,865,000* | -5,292,000* | -83,000* | -1,183,000* | -5,351,000* | -9,285,000* |
Revenues and EBITDA – last 3 fiscal years
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues ($) | 80,993,000 | 99,882,000* | 96,964,000* |
| EBITDA ($) | -30,181,000* | -52,024,000* | -11,621,000* |
Values retrieved from S&P Global for asterisked entries.
TSR and peer benchmarking (Pay vs Performance disclosures)
| Year | Company TSR ($) | Peer Group TSR ($) | Net Income ($) | Total Revenue ($) |
|---|---|---|---|---|
| 2021 | 27.36 | 147.19 | (23,269,000) | 52,400,000 |
| 2022 | 3.64 | 62.62 | (182,209,000) | 117,637,000 |
| 2023 | 0.01 | 88.88 | (232,401,000) | 156,444,000 |
Peer group used in disclosures: Bitfarms Limited, Cipher Mining, CleanSpark, Hive Digital Technologies, Riot Platforms, Titan Machinery, Alta Equipment Group, B. Riley Financial .
Say‑on‑Pay & Shareholder Feedback
- Stockholders approved, on an advisory basis, the compensation paid to named executive officers at the November 23, 2022 annual meeting; advisory vote held every three years .
Risk Indicators & Red Flags
- Prior bankruptcy exposure: While CFO of Local Corporation (2009–2016), the company filed a voluntary Chapter 11 petition in June 2015 (disclosed in company filings) .
- Underwater options and retention: Company cites stock volatility and underwater prior grants as impairing retention; proposes new option grants (including to CFO) to restore retention value, with half vesting upon stockholder approval and remainder time-based thereafter .
- Ownership alignment: CFO reported 0 beneficial ownership and no recent transactions; company has no formal ownership guidelines and no hedging policy (as of FY2023), though it permits 10b5‑1 plans .
- Dilution/governance context: 2025 proxies detail significant preferred stock financing (Series H) convertible at low “floor” with voting mechanics and board-seat implications; also separate proposals to approve director/executive equity issuances (context for potential dilution) .
Compensation Structure Analysis
- Mix and risk: 2022 CFO equity tilted heavily toward options (15,000,000 shares at $0.29) with 50% performance‑contingent vesting; 2025 grant is entirely time‑based (1,000,000 options at $0.72, half immediate upon approval, half monthly starting 2026) .
- Retention features: Immediate vesting of 50% upon stockholder approval in 2025 can provide retention/recognition, but near‑term monetization depends on trading above the $0.72 strike; prior grants were characterized as underwater by the company .
- Cash pay signals: Last CFO “fixed pay” disclosed at appointment was modest relative to peers ($200k, 2020); no recent CFO cash pay disclosure available due to Smaller Reporting Company presentation, limiting visibility into pay‑for‑performance calibration .
Equity Ownership & Alignment (detailed)
| Item | Detail |
|---|---|
| Beneficial ownership (most recent proxy) | 0 shares; 0% . |
| Recent insider activity | No transactions by Mr. Cragun during the 60 days preceding the Sept 30, 2025 Schedule 13D/A; not deemed to own any Class A shares . |
| Ownership policy | No formal stock ownership guidelines; insider trading policy permits Rule 10b5‑1 trading plans . |
| Hedging/Pledging | 2023 10‑K states no hedging policies adopted; no pledge disclosures identified for CFO . |
Employment Terms (detailed)
| Term | Detail |
|---|---|
| Appointment & pay at hire | Appointed CFO Aug 20, 2020; no employment agreement; paid $200,000 annually . |
| Severance / Change‑in‑control | No CFO‑specific severance or CIC economics disclosed; CEO/President terms are disclosed separately (not applicable to CFO) . |
| Clawback | CFO‑specific clawback terms not disclosed; President/GC bonuses and equity subject to company clawback . |
Performance Compensation (detailed table)
| Metric/Feature | Weighting | Target | Actual/Payout | Vesting |
|---|---|---|---|---|
| 2022 Option Grant (15,000,000 sh at $0.29) | 50% time / 50% performance | Performance milestones set by Compensation Committee (not disclosed) | Not disclosed | Time: 1/48 monthly from Jan 1, 2023; Performance: upon milestone achievement |
| 2025 Option Grant (1,000,000 sh at $0.72) | 100% time-based | n/a | n/a | 50% upon stockholder approval; 50% monthly from Jan 1, 2026; exercisable upon NYSE & stockholder approvals and 2025 Plan |
Investment Implications
- Alignment and retention: The 2025 option structure (50% immediate vest on approval; 50% over time) is retention‑oriented and less performance‑rigorous than the 2022 grant; with the company noting underwater legacy grants, near‑term selling pressure appears limited unless shares trade above the $0.72 strike .
- Skin‑in‑the‑game: Zero reported beneficial ownership and no formal ownership guidelines weaken pay‑performance alignment optics for the CFO; permitting 10b5‑1 plans helps orderly trading but the absence of hedging restrictions (as of FY2023) is a governance gap versus best practice .
- Contractual risk: Lack of disclosed CFO severance/CIC protections suggests lower cash severance risk for shareholders but may elevate executive retention risk if market alternatives arise; limited disclosure constrains benchmarking .
- Execution record: Extensive public-company CFO experience is a positive; however, prior CFO tenure at a company that later entered Chapter 11 (Local Corp.) is a historical risk factor to monitor alongside current operating and financing complexity at GPUS .