Form 4: Terawulf CEO Acquires 1.17M Shares in Earnout

Terawulf Inc. CEO Paul B. Prager acquired 1,173,272 shares of common stock as earnout consideration, increasing his total beneficial ownership to over 45.5 million shares.

Summary

• Paul B. Prager, CEO, Director, and 10% Owner of Terawulf Inc., acquired 1,173,272 shares of common stock on October 17, 2025.
• The acquisition represents earnout consideration pursuant to a Membership Interest Purchase Agreement (MIPA) dated May 21, 2025.
• The earnout was triggered by the closing of Terawulf's $1 billion convertible notes private offering on August 21, 2025.
• The share issuance was deferred until October 17, 2025, pending stockholder approval to amend the company's certificate of incorporation to increase authorized common stock.
• Following this transaction, Mr. Prager beneficially owns a total of 45,567,240 shares of Terawulf common stock, held directly and indirectly.
• Indirect ownership includes 4,968,852 shares via Beowulf E&D Holdings Inc., 39,654,688 shares via Riesling Power LLC, and 5,000 shares via Heorot Power Holdings LLC.
• Direct ownership accounts for 938,700 shares.

Sentiment

Score: 7

Explanation: The acquisition of shares by the CEO, even as an earnout, is generally positive as it increases insider ownership. The underlying event (successful $1 billion capital raise) is also a strong positive. The deferral of share issuance due to needing stockholder approval for authorized shares is a minor procedural delay, not a fundamental negative.

Positives

• CEO Paul B. Prager's acquisition of 1,173,272 shares, even as earnout consideration, demonstrates continued alignment of management interests with shareholder value.
• The earnout was triggered by a significant $1 billion convertible notes private offering, indicating successful capital raising for the company.

Future Outlook

The filing indicates a past event (earnout trigger) and a completed transaction (share issuance). No explicit forward-looking statements or guidance are provided beyond the completion of the earnout.

Industry Context

This insider transaction reflects a compensation event tied to a prior acquisition agreement and a successful capital raise. In the broader industry, insider acquisitions, even through earnouts, can be viewed as a sign of management's confidence in the company's future prospects, particularly following a significant financing event.

Corporate Governance

Related Party Transactions

• The acquisition of 1,173,272 shares by Beowulf E&D Holdings Inc. as earnout consideration is a related party transaction, as Paul B. Prager is the sole trustee of the Prager Revocable Trust, which is the sole shareholder of E&D Holdings.

Stakeholder Impact

• **Shareholders:** Increased insider ownership by the CEO may be viewed positively, aligning management interests with shareholder value. The need for stockholder approval for authorized shares indicates adherence to governance procedures.
• **Creditors (Convertible Note Holders):** The successful $1 billion convertible notes offering provides capital, potentially strengthening the company's financial position.

Key Dates

Recommendation

This Form 4 primarily reports an insider acquisition of shares as part of an earnout agreement, which is a pre-determined compensation event rather than a discretionary open-market purchase. While the increase in CEO ownership is generally a positive signal of alignment, and the underlying $1 billion capital raise is significant, a Form 4 alone does not provide sufficient comprehensive financial data to warrant a 'buy' or 'sell' recommendation. Investors should 'hold' and consider this information in conjunction with broader financial reports and company performance.

Keywords

Terawulf, WULF, Paul B. Prager, Insider Transaction, SEC Form 4, Stock Acquisition, Earnout, Common Stock, CEO, Director, Beneficial Ownership, Convertible Notes, Capital Raise