David Michaels
Soluna HoldingsAbout David Michaels
David C. Michaels, age 70, has served on Soluna Holdings’ Board since August 2013; he was Lead Independent Director (2016–Apr 2023), Chairman of the Board (Jan 2017–Jan 2022), Interim CFO (Apr 24, 2023–Apr 8, 2024), and reappointed Interim CFO effective Aug 21, 2025 via a consulting agreement . He holds a B.S. in Accounting and Finance (minor in Economics) from the University at Albany, completed graduate-level coursework at LIU Post, and the Leadership Institute Program at RPI’s Lally School of Management . Company performance during his recent board tenure shows sharp revenue growth but continued losses: revenue rose from $4.1M (FY22) to $10.2M (FY23) to $18.9M (FY24); EBITDA was negative each year; Net Income remained negative; TSR fell from 228 (2022) to 62 (2023) to 53 (2024) on a $100 base* .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| Soluna Holdings, Inc. | Director; Lead Independent Director; Chairman; Interim CFO (two periods); Interim CFO/Treasurer (from Aug 21, 2025) | Director since 2013; LID 2016–Apr 2023; Chair 2017–2022; Interim CFO Apr 24, 2023–Apr 8, 2024; Interim CFO/Treasurer from Aug 21, 2025 | Longstanding governance leadership; stepped in to stabilize finance function during CFO transitions . |
| American Institute for Economic Research | Chief Financial Officer | 2008–2018 | Senior finance leadership at a research/education organization . |
| Starfire Systems, Inc. | Chief Financial Officer | 2006–2008 | Corporate finance leadership . |
| Albany International Corp. | VP Treasury & Tax; Chief Risk Officer | 1987–2006 | Corporate treasury, tax, and risk oversight . |
| Veeco Instruments | Controller and Tax Manager roles | 1979–1987 | Accounting, tax leadership roles . |
External Roles
| Organization | Role | Years | Notes |
|---|---|---|---|
| Iverson Genetic Diagnostics, Inc. | Chairman of the Board; Chair of Audit Committee | Ongoing | Governance and audit oversight . |
| Country Club of Troy | Board of Governors; Treasurer | Ongoing | Financial oversight . |
Fixed Compensation
| Component | Period | Terms | Source |
|---|---|---|---|
| Interim CFO consulting fee | Apr 24, 2023 onward (at least 4 months) | $25,000 per month; one-time 25,309 RSAs granted Apr 15, 2024 for interim CFO service; RSAs vested immediately on grant date . | |
| Interim CFO consulting fee (re-appointment) | Aug 21, 2025–Dec 20, 2025 (4 months) | $30,000 per month; D&O coverage for 5 years post term; reimbursable expenses; terminable by company on 30 days’ notice . | |
| Director cash retainer | FY 2024 | $14,583 cash; total 2024 director comp $553,481 (stock awards $538,898; no options granted in 2024) |
Notes:
- As an employee (Interim CFO) in 2023, he did not receive separate director pay per company policy .
Performance Compensation
| Equity award (type) | Grant date | Shares/Units | Vesting | Notes/Value |
|---|---|---|---|---|
| RSAs (common) – Director | Apr 15, 2024 | 41,176 | Service-based; see separation-vesting block below | |
| RSAs (Series A preferred) – Director | Apr 15, 2024 | 52,977 | Service-based; see plan terms | |
| RSAs (common) – Director | Jun 1, 2024 | 5,981 | Service-based | |
| RSAs (common) – Director | Sep 1, 2024 | 46,021 | Service-based | |
| RSAs (common) – Director | Dec 1, 2024 | 43,044 | Service-based | |
| RSAs (common) – Interim CFO award | Apr 15, 2024 | 25,309 | 100% vested immediately (for interim CFO performance/service) | |
| RSAs (common) – separation vesting block | As of Jun 30, 2025 | 222,734 | 100% vests on separation from the Company | |
| RSAs (common) – separation vesting block | As of Sep 29, 2025 | 339,313 | 100% vests on separation from the Company |
Stock options outstanding (Dec 31, 2023):
- 520 @ $27.00 (exp. 3/14/2024)
- 600 @ $30.00 (exp. 3/05/2025)
- 600 @ $22.50 (exp. 12/12/2028)
- 1,064 @ $171.00 (exp. 5/13/2026)
- 3,125 @ $23.75 (exp. 11/22/2027)
Plan-level vesting under change-of-control:
- Master Restricted Stock Agreements (RSAs): all shares vest upon a change of control (subject to 280G/4999) .
- General RSAs: Compensation Committee may accelerate vesting upon change of control .
Equity Ownership & Alignment
| Metric | Apr 15, 2024 | Jun 30, 2025 | Sep 29, 2025 |
|---|---|---|---|
| Beneficial ownership (shares) | 73,453 | 263,603 | 380,182 |
| Ownership % of outstanding | 1.9% | 1.4% of 19,055,122 shares | <1% of 64,051,790 shares |
| Options exercisable within 60 days | 1,200 | 600 | 600 |
| RSAs (separation-vest) included in beneficial holdings | 41,176 (included as separation-vest block in footnote) | 222,734 (100% vests on separation) | 339,313 (100% vests on separation) |
| Hedging policy | Company prohibits hedging by directors/officers/employees . | — | — |
| Ownership guidelines | Company states it does not impose equity ownership guidelines on executives . | — | — |
Pledging: No explicit pledging disclosure identified in the proxies; hedging is prohibited under the insider trading policy .
Employment Terms
- Consulting agreement (Aug 21–Dec 20, 2025): Non-employee Interim CFO; $30,000/month for 4 months; reimbursable expenses; D&O indemnification and insurance through five years post termination; terminable by company on 30 days’ notice; consultant free to perform services for other parties .
- Earlier consulting agreement for Interim CFO (from Apr 24, 2023): $25,000/month; additional one-time RSAs (25,309) vested immediately on Apr 15, 2024 for performance/service .
- Equity award agreements adopted Apr 15, 2024: Master RSAs fully accelerate on change-of-control; General RSAs may accelerate at committee discretion .
- Clawback: Company adopted a clawback policy in Nov 2023 covering incentive compensation tied to financial measures over the prior three fiscal years in the event of an accounting restatement (no clawbacks incurred for FY2023) .
Board Governance
- Independence and dual-role implications: The Board determined in 2025 that Michaels is an “independent director” under Nasdaq rules; however, he ceased to be independent while serving as Interim CFO (Apr 2023–Apr 8, 2024), and regained non-employee status upon stepping down; he was re-appointed Interim CFO effective Aug 21, 2025, again becoming a management director during that service .
- Committee service: Former Chair of Audit Committee (through 2023); resigned from Audit Committee upon Interim CFO appointment in Apr 2023 .
- Board/committee structure (2025): Audit (Marusak–Chair, Hirshfield, Phelan, Bottomley), Compensation (Phelan–Chair, Hazelip, Bottomley), Nominating/Governance (Hirshfield–Chair, Hazelip, Marusak), Executive (Phelan–Chair, Bottomley, Lipman, Toporek) .
- Meetings/attendance: Board met 26 times in 2024; each director attended at least 75% of Board and committee meetings .
- Lead Independent Director: William P. Phelan .
Director Compensation
| Year | Cash ($) | Equity ($) | Total ($) | Notes |
|---|---|---|---|---|
| 2024 | 14,583 | 538,898 | 553,481 | 2024 grants: 41,176 common RSAs (Apr 15), 52,977 preferred RSAs (Apr 15), 5,981 (Jun 1), 46,021 (Sep 1), 43,044 (Dec 1) . |
| 2023 | — | — | — | No director pay while serving as Interim CFO (employees not compensated as directors) . |
Performance & Track Record
Company operating metrics during recent years:
| Metric | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Revenues ($) | 4,138,000* | 10,196,000* | 18,854,000* |
| EBITDA ($) | (8,454,000)* | (6,289,000)* | (31,753,000)* |
| Net Income - (IS) ($) | (98,715,000)* | (29,201,000)* | (63,334,000)* |
Values marked with * retrieved from S&P Global via GetFinancials.
Total Shareholder Return (Pay vs Performance table; $100 initial investment):
| Year | 2022 | 2023 | 2024 |
|---|---|---|---|
| TSR ($ value of $100) | 228 | 62 | 53 |
Contextual governance events with dilution implications:
- Reverse stock split authorization (1:5 to 1:50 ratio) approved Aug 2025 to support Nasdaq compliance .
- Special meeting Oct–Nov 2025 to increase authorized common shares from 75,000,000 to 375,000,000 (dilution risk noted by company) .
Compensation Structure Analysis
- Mix and shifts: In 2024, director pay was heavily equity-based ($538,898 equity vs. $14,583 cash), indicating strong equity emphasis for directors; as interim CFO, Michaels was paid fixed monthly consulting fees rather than salary/bonus .
- Time-/separation-based equity vs. performance equity: A substantial block of Michaels’ RSAs vest 100% upon separation—effectively a single-trigger vest; this may reduce performance linkage and could create unintended incentives around tenure separation .
- Change-of-control treatment: Master RSAs automatically vest on CoC (single-trigger); General RSAs may vest at the committee’s discretion; this can concentrate value realization around transactions rather than multi-year operating performance .
- Governance safeguards: Anti-hedging policy and clawback framework in place; no explicit equity ownership guidelines (executives), which can weaken long-term alignment .
Risk Indicators & Red Flags
- Dual role/independence: Repeated transitions between independent director and interim CFO reduce independence during those periods and concentrate oversight and execution roles in one individual .
- Separation-trigger vesting: Large blocks of RSAs vest in full upon separation; this feature can be shareholder-unfriendly if it rewards departure rather than sustained performance .
- Dilution risk: Reverse split authorization and significant increase in authorized shares highlight capital structure fragility and potential dilution overhang .
- CFO turnover/retention: CFO changes in 2024 and 2025 (with Michaels twice filling Interim CFO) signal finance leadership continuity risk .
Compensation Committee Analysis
- Composition (independent): William P. Phelan (Chair), William Hazelip, John Bottomley .
- Use of consultants: Compensation Committee did not engage external consultants in 2023 .
- Scope: Oversees CEO/NEO compensation, equity plans, and succession planning .
Board Governance (Director-Specific)
- Committee memberships: Michaels previously chaired the Audit Committee; stepped off Audit upon becoming Interim CFO in Apr 2023 .
- Attendance: Board met 26 times in 2024; directors met the ≥75% attendance threshold .
- Independence status: Independent under Nasdaq when not serving as an officer; non-independent during Interim CFO service .
Investment Implications
- Alignment vs. liquidity pressure: Separation-trigger RSAs and change-of-control acceleration can concentrate value on departure or transactions, potentially weakening long-horizon performance alignment; absence of ownership guidelines compounds this .
- Governance watchpoints: Dual-role cycling (director ↔ interim CFO) and CFO turnover increase oversight and execution risk; monitor progress on permanent CFO recruitment and reestablishment of full independence .
- Capital structure overhang: Reverse split authorization and sharp increase in authorized shares point to ongoing financing needs and potential dilution; insider holdings rise in absolute terms but fall as % of shares outstanding, tempering “skin-in-the-game” signaling .
- Operating trajectory: Revenues grew materially in FY22–FY24 but with persistent negative EBITDA and net income; TSR deteriorated 2022→2024, suggesting pay and equity structures should emphasize multi-year operating and TSR outcomes to reinforce alignment* .
Footnotes:
- Values marked with an asterisk are retrieved from S&P Global via GetFinancials.