Item 5.02 Directors; Appointment of Certain Officers; Compensatory
Arrangements of Certain Officers.
Form of Performance-Based Restricted Stock Unit Award Agreement
On August 12, 2021, the
Compensation Committee (“Compensation Committee”) of the Board of Directors of Riot Blockchain, Inc. (“Riot,”
“us,” “we,” “our” or the “Corporation”) approved a new performance-based
restricted stock unit performance plan (the “Performance RSU Plan”) for all executive officers and eligible employees
of the Corporation and its consolidated subsidiaries. In connection with the Performance RSU Plan, the Compensation Committee approved
a form of performance-based restricted stock unit award agreement (the “Performance RSU Award Agreement”)
under the 2019 Riot Blockchain, Inc. Equity Incentive Plan, as amended (the “2019 Equity Plan”) in relation to granting
performance-based restricted stock units awards (“Performance RSU Awards”) to all executive officers and eligible employees
of the Corporation and its consolidated subsidiaries, which are eligible to vest during the performance period ending December 31, 2023
(the “Performance Period”) based upon the Corporation achieving certain performance goals, as further described below.
The Performance RSU Award
Agreement provides for the grant of Performance RSU Awards, which generally vest upon the successful completion of specified milestones
for each 100 megawatts (“MW”) of added infrastructure capacity, as defined in the program, up to a total capacity of
1,500 MW (as described in the Performance RSU Award Agreement) (the “Infrastructure Development Target”). The
Performance RSU Award Agreement also provides for the grant of Performance RSU Awards which generally vest if the Company achieves
specified thresholds of Adjusted EBITDA (as described in the Performance RSU Award Agreement) (“Adjusted EBITDA”).
The vesting and issuance of shares of common stock to the award participant only occurs if the Corporation achieves specified thresholds
of the Infrastructure Development Target and Adjusted EBITDA during the Performance Period.
The exact number of shares
issuable pursuant to the Performance RSU Award Agreement depends on level of the Corporation’s performance against the Infrastructure
Development Target and Adjusted EBITDA target, as determined by the Compensation Committee during the Performance Period, and in general
can range from 0% to 100% of the target number of Performance RSU Awards, depending on the level of achievement of the Infrastructure
Development Target and Adjusted EBITDA targets. If the Infrastructure Development Target or Adjusted EBITDA targets have not been met
by the end of the Performance Period, any unvested Performance RSU Awards are forfeited.
The foregoing description
is subject to, and qualified in its entirety by (i) the Corporation’s 2019 Equity Plan, which was filed on September 20, 2019 with
the Corporation’s Definitive Proxy Statement on Form DEF14A as Exhibit 4.5, as approved by the Corporation’s shareholders
on October 23, 2019, as amended on November 12, 2020 with respect to the first amendment to the 2019 Equity Plan; and (ii) the Performance
RSU Award Agreement, which is filed with this Current Report as Exhibit 10.1 and is incorporated herein by reference.
Grants of Performance RSU Awards
Based on the Compensation
Committee’s review and, in consultation with Meridian, its independent compensation consultant, the Compensation Committee determined
to grant to the named executive officers and all eligible employees of the Corporation and its consolidated subsidiaries, Performance
RSU Awards with a grant date of August 12, 2021. The following table sets forth the named executive officers and their total Performance
RSU Awards target, which are eligible to vest during the Performance Period commencing in 2021 and ending December 31, 2023:
|
Name
|
|
Total Performance RSU Awards Target During the Performance Period
|
Benjamin Yi
Executive Chairman
|
|
|
525,000
|
|
Jason Les
Chief Executive Officer
|
|
|
525,000
|
|
Jeffrey McGonegal
Chief Financial Officer
|
|
|
450,000
|
|
Megan Brooks
Chief Operating Officer
|
|
|
400,000
|
|
The Performance RSU Awards
will be measured against the performance goals set forth in the Performance RSU Award Agreement, as determined by the Compensation Committee
during the Performance Period, and the number of shares of common stock of the Corporation that may eventually vest during the Performance
Period, will be between 0% and 100% of an executive’s target shares, depending on his or her continued service with the Corporation
and the extent to which the performance goals have been achieved during the Performance Period. If the Infrastructure Development Target
or Adjusted EBITDA targets have not been met by the end of the three-year Performance Period, any unvested Performance RSU Awards will
be forfeited.
The foregoing description
of the Performance RSU Awards for the above-named executive officers is a summary and is qualified in its entirety by reference to the
Performance RSU Award Agreement, filed herewith as Exhibit 10.1, and the terms of which are incorporated herein by reference.
Cautionary Note Regarding Forward-Looking
Statements
The information provided in this Current Report,
including the information set forth in the press release attached hereto as Exhibit 99.1, may include “forward-looking statements”
(within meaning of Section 27A of the Securities Act and Section 21E of the Exchange Act) relating to future events or the future financial
performance of the Corporation. Because such statements are subject to risks and uncertainties, actual results may differ materially from
those expressed or implied by such forward-looking statements. Words such as “anticipates,” “plans,” “expects,”
“intends,” “will,” “potential,” “hope” and similar expressions are intended to identify
forward-looking statements. These forward-looking statements are based upon current expectations of the Corporation and involve assumptions
that may never materialize or may prove to be incorrect. However, the inclusion of forward-looking statements should not be regarded as
a representation by the Corporation or any other person that future events, plans, or expectations contemplated by the Corporation will
be achieved. Actual results and the timing of events could differ materially from those anticipated in such forward-looking statements
as a result of various risks and uncertainties. Detailed information regarding factors that may cause actual results to differ materially
from the results expressed or implied by statements in reports relating to the Corporation may be found in the Corporation’s periodic
filings with the Securities and Exchange Commission (“SEC”), including the factors described under the heading “Risk
Factors” in the Corporation’s Annual Report on Form 10-K for the year ended December 31, 2020, filed with the SEC on March
31, 2021, as amended, and its interim reports on Forms 10-Q and 8-K, as well as future reports the Corporation files with the SEC, copies
of which may be obtained from the SEC’s website at www.sec.gov. It is not possible to predict all risks, nor can the
Corporation comprehensively assess the impact of all factors on our business or the extent to which any factor, or combination of factors,
may cause actual results to differ materially from those contained in any forward-looking statements the Corporation may make. In light
of these risks, uncertainties and assumptions, the future events and trends discussed in this Current Report may not occur and actual
results could differ materially and adversely from those anticipated or implied in the forward-looking statements. Given these risks and
uncertainties, the reader should not place undue reliance on these forward-looking statements. All forward-looking statements included
in this Current Report are made only as of the date of this Current Report, and the Corporation does not undertake any obligation to publicly
update or correct any forward-looking statements to reflect events or circumstances that subsequently occur, or of which the Corporation
hereafter becomes aware, except as required by law.