SCHEDULE: Bakkt CEO Naheta Boosts Stake, Details DTR Integration

Bakkt Holdings CEO Akshay Sudhir Naheta has increased his beneficial ownership to 6.3% through open market purchases, stock options, and a reorganization, while detailing a strategic cooperation agreement with his other company, DTR.

Summary

• Akshay Sudhir Naheta, CEO of Bakkt Holdings, Inc., beneficially owns 1,592,015 shares of Class A Common Stock, representing 6.3% of the class.
• This ownership includes 249,733 direct shares and options to acquire an additional 1,342,282 shares.
• A corporate reorganization on November 3, 2025, made Bakkt Holdings, Inc. the parent company, without altering security holders' proportionate economic interests.
• Naheta received 69,733 shares of Class A Common Stock as part of an amendment to the Tax Receivable Agreement, where he contributed his TRA rights in exchange for shares.
• He was granted options to purchase 1,342,282 shares at an exercise price of $10.00 per share, approved by shareholders on October 31, 2025. These options include mandatory quarterly exercises and additional optional exercises.
• Naheta also acquired 180,000 shares of Old Bakkt Class A Common Stock through open market purchases on August 21 and 22, 2025, at weighted average prices ranging from $8.00 to $8.55 per share, using personal funds.
• A Cooperation Agreement with Distributed Technologies Research Ltd. (DTR), where Naheta is CEO, grants Bakkt exclusive rights to DTR's payment processing technology.
• The Cooperation Agreement includes a Call Option for Bakkt to acquire DTR, a Right of First Refusal, and a Put Option for Naheta to sell DTR to Bakkt, with consideration in Bakkt Class A Common Stock (19.9% to 31.5% of aggregate common stock).
• Naheta's employment agreement includes an annual base salary of $100,000 and an inducement grant of $15.0 million in Performance Stock Units (PSUs) and $150,000 in Service-Based Restricted Stock Units (RSUs).
• PSUs vest based on Bakkt's stock price appreciation, with one-third vesting if the stock price doubles from $9.33, and additional tranches for further 25% appreciation.

Sentiment

Score: 7

Explanation: The filing indicates strong alignment between the CEO and shareholder interests through increased personal ownership and performance-based incentives. The strategic DTR integration offers potential for growth in payment processing. However, the significant potential dilution from the DTR acquisition and the ambitious PSU targets introduce elements of risk and uncertainty.

Positives

• CEO Akshay Naheta has significantly increased his personal stake in Bakkt, aligning his interests with shareholders.
• The strategic Cooperation Agreement with DTR provides Bakkt with exclusive payment processing technology, potentially enhancing its platform and global payment services.
• The structure of the DTR acquisition (Call/Put Options) provides flexibility for Bakkt to integrate DTR based on performance metrics (e.g., $2 billion payment volume).
• The CEO's performance-based equity awards (PSUs) are tied to substantial stock price appreciation (100% increase from $9.33), incentivizing strong performance.

Negatives

• The DTR acquisition terms could result in significant dilution for existing shareholders, with Naheta potentially receiving 19.9% to 31.5% of Bakkt's aggregate common stock.
• The valuation of DTR Equity for the Call/Put Options will be determined by a third-party valuation firm, introducing an element of uncertainty regarding the final cost to Bakkt.
• The CEO's base salary of $100,000 is relatively low for a public company CEO, but this is offset by substantial equity grants, which could be seen as a positive or negative depending on perspective (high incentive, but also high potential payout).
• The filing does not provide specific financial performance metrics for Bakkt, making it difficult to assess the immediate impact of these transactions on the company's financial health.

Risks

• Potential shareholder dilution from the DTR acquisition if the Call or Put Option is exercised, as Naheta could receive a substantial percentage of Bakkt's common stock.
• The success of the DTR integration and its technology in driving payment volume is crucial for the value realization of the Cooperation Agreement.
• The stock price performance targets for PSU vesting are ambitious (100% appreciation from $9.33), and failure to meet these could impact management incentives and retention.
• The company's ability to obtain necessary regulatory approvals and stockholder approvals for the DTR acquisition is a condition for the transaction.
• The termination fee of 3.0% of DTR Value payable to Naheta if the Put Option is terminated for a superior change-of-control proposal represents a potential cost to Bakkt.

Future Outlook

Akshay Naheta, as a securityholder and executive, may consider or encourage extraordinary corporate transactions such as mergers, reorganizations, asset sales, or changes to capitalization and corporate structure. The company also has an exclusive Call Option to acquire DTR within 12 months of initiating payments using DTR's technology, and a Put Option for Naheta if DTR-powered payment volume exceeds $2 billion within 18 months.

Management Comments

• It was in the best interests of Old Bakkt and its stockholders for certain members of management, including the Reporting Person, to similarly have the opportunity to invest in Old Bakkt and strengthen alignment with Old Bakkt's stockholders through increased stock ownership.

Industry Context

This filing highlights a trend of executive ownership increases and strategic technology integrations in the digital asset and payment processing industry. Bakkt, operating in the evolving fintech and crypto space, is leveraging internal leadership's other ventures (DTR) to enhance its platform, a common strategy for companies seeking to consolidate technology and talent. The significant equity incentives for the CEO underscore the high-growth, high-risk nature of the sector and the importance of aligning management with long-term shareholder value creation.

Comparison to Industry Standards

• The CEO's beneficial ownership of 6.3% is a substantial stake, indicating strong personal conviction, which is generally viewed positively compared to executives with minimal personal holdings in their companies.
• The use of performance-based restricted stock units (PSUs) tied to significant stock price appreciation (100% from $9.33) is a common, aggressive incentive structure seen in high-growth technology companies, similar to those used by early-stage fintechs or blockchain companies aiming for rapid scale.
• The strategic agreement to potentially acquire DTR, a private company focusing on stablecoin technology, through a Call/Put option mechanism, is comparable to how larger tech firms integrate innovative startups, often using equity as consideration to align interests and conserve cash. For example, similar structures have been observed in acquisitions within the broader fintech ecosystem, where a larger entity integrates a specialized technology provider.
• The potential dilution range of 19.9% to 31.5% for the DTR acquisition is significant and would be scrutinized by investors, similar to how major acquisitions by companies like PayPal or Square (now Block) are evaluated for their dilutive impact versus strategic value.

Management Changes

Corporate Governance

Related Party Transactions

• Cooperation Agreement between Bakkt Holdings, Inc. and Distributed Technologies Research Ltd. (DTR), where Akshay Sudhir Naheta is CEO and sole stockholder of DTR, and also CEO of Bakkt. This agreement includes Call and Put Options for Bakkt to acquire DTR.
• Amendment to the Tax Receivable Agreement and Contribution Agreement involving Old Bakkt, Intercontinental Exchange Holdings, Inc. (ICE), and Akshay Naheta, where Naheta contributed his TRA rights to the Issuer in exchange for Class A Common Stock.
• Employment Agreement, Performance Stock Unit Agreement, and Restricted Stock Unit Agreement between Bakkt Holdings, Inc. and Akshay Sudhir Naheta, detailing his compensation and equity grants.

Stakeholder Impact

• Shareholders: Potential for significant dilution if the DTR acquisition occurs, but also potential for increased value through strategic technology integration and strong CEO alignment via equity ownership and performance incentives.
• Employees: The reorganization and strategic agreements could lead to integration efforts and potential changes in operational structure, particularly for employees involved in payment processing or DTR's technology.
• Customers: The integration of DTR's exclusive payment processing technology could enhance Bakkt's platform offerings and global payment services, potentially benefiting customers.
• Creditors: The requirement for Bakkt to terminate any lines of credit and repay outstanding indebtedness as a condition for the DTR Call/Put Option transaction could impact the company's financial leverage and liquidity.

Next Steps

• Akshay Naheta may acquire additional securities or sell existing holdings based on market conditions and company performance.
• Bakkt may exercise its Call Option to acquire DTR within 12 months of initiating payments using DTR's technology.
• Akshay Naheta may exercise his Put Option to sell DTR to Bakkt if DTR-powered payment volume exceeds $2 billion within an 18-month period.
• Mandatory exercise of Reporting Person Options will occur quarterly for eight quarters.
• RSUs granted to Naheta will vest on the one-year anniversary of March 21, 2025.
• PSUs will vest over a three-year performance period based on stock price appreciation.

Key Dates

Recommendation

The filing reveals strong alignment of the CEO's interests with shareholders through increased personal ownership and substantial performance-based equity incentives. The strategic cooperation agreement with DTR offers a clear path for Bakkt to integrate valuable payment processing technology, which could drive future growth. However, the potential for significant shareholder dilution (19.9% to 31.5%) from the DTR acquisition, the ambitious stock price targets for PSU vesting, and the lack of immediate financial performance data warrant a 'hold' recommendation. Investors should monitor the progress of DTR integration, the company's financial results, and the terms of any eventual DTR acquisition before making further investment decisions.

Keywords

Bakkt Holdings, Akshay Naheta, Schedule 13D, Beneficial Ownership, Stock Options, DTR, Cooperation Agreement, Payment Processing, Corporate Reorganization, Equity Compensation, CEO, Shareholder Alignment, Dilution Risk, Performance Stock Units, Restricted Stock Units