ATG Capital wins one Empery Digital board seat in proxy fight

Boardroom Alpha · Executive Brief

ATG Capital has won a seat on the board of Empery Digital (EMPD). Shareholders elected its nominee, Aaron Morris, on October 14, replacing Örn Ólason, an independent director since December 2024. The board’s other eight nominees, including chair and co-CEO Ryan Lane, were elected. The results are preliminary until certified.

One seat is a win for a 16% holder whose nominees the board tried to keep off the ballot. Our evaluation of the contest pointed to a breakthrough. Holders also broke from the proxy advisors: they re-elected Ian Read, whom ISS and Glass Lewis opposed, and passed over ATG founder Gabriel Gliksberg, whom both backed.

Empery’s stock closed at $3.03 on October 15, 70% below the $10 investors paid in July 2025. It also trades below the $4.72 a share of net asset value in its own September figures. Morris’s first test is a $62.1 million payment due when the data-center deal closes; the same September figures showed $66.1 million in cash.

ATG had to win in court to get on the ballot

ATG nominated nine directors on February 26. On March 26 the board rejected all of them under its advance-notice bylaws, the rules for how holders must nominate directors. It cited inaccurate biographies, an undisclosed short position in bitcoin funds and signs of coordination with another holder, Tice Brown. On August 28 Delaware’s Court of Chancery ruled that the rejection “was inequitable and constituted a breach of the directors’ fiduciary duties.” Empery says the court found evidence that “lent credence” to the board’s concerns, but held that the bylaws did not clearly require ATG to disclose them. The Delaware Supreme Court affirmed the ruling on October 8, six days before the meeting.

The board says it offered Morris a seat early in the dispute and again on September 8; ATG says no offer was made. Either way, Morris got his seat only after the board lost the ballot fight in both courts.

On September 2 the Chancery court sanctioned ATG and awarded the directors their fees for the motion and the added discovery. Gliksberg had left his messages on auto-delete for more than two weeks after he was told to preserve records for the lawsuit, which the court called “at least reckless.” Two days later ATG cut its slate to four nominees. ATG later said it narrowed the slate because Empery “has begun expanding beyond its digital asset treasury strategy.” The board tied the cut to the sanction, saying ATG was “no longer seeking control.”

Empery put its own cost of the contest at about $22.5 million in its proxy statement. That is about a quarter of its stock-market value, roughly $85 million on October 15. It later said insurance covers fees above $5 million.

Empery, formerly the electric off-road vehicle maker Volcon, raised $501 million at $10 a share in July 2025 to buy and hold bitcoin. It then bought back 26.2 million shares at an average of $5.71, which it says raised the bitcoin behind each share. It has also sold much of its bitcoin this year to pay down debt and fund buybacks, legal costs and an investment in an AI data center. It held 1,144 bitcoin on September 15, down from 4,018 in August 2025. A company presentation that day put net asset value, mainly bitcoin and cash less debt, at $4.72 a share. The stock, at $2.88, traded about 39% below that.

Shareholders did not follow either advisor’s slate

All three proxy advisors backed some change, but none of their slates matched the result. ISS backed Gliksberg and Morris and recommended withholding votes from Ian Read and Ólason. Glass Lewis backed Gliksberg, Morris and James Elbaor and recommended withholding from Lane, Read and Ólason. Egan-Jones backed all four ATG nominees. On the contested seats, holders sided with ISS and Glass Lewis on Morris and Ólason, and went against both on Gliksberg and Read.

Gliksberg lost even though all three advisors backed him. The board had made the court’s sanction the center of its case against him, calling him “not fit to serve on our board.” Read, a former Pfizer CEO who chairs the nominating and governance committee, was re-elected although ISS and Glass Lewis both opposed him. ATG said he testified under oath that he did not know he held that role; the board pointed to his “Fortune 100 governance experience.”

Insiders held more stock than ATG. Directors and officers held 21.2% of the shares on the record date, including 17.5% for Lane and the Empery Asset Management funds he founded; ATG held 16%.

Our view: give Morris a real role, and the directors should own the stock

This is a partial win for ATG, and a warning for the board. Shareholders kept most of the incumbents. But they removed one and elected a dissident, after two courts ruled against the board’s attempt to keep ATG off the ballot. The stock is down 58.3% in a year, against a gain of 11% for the Russell 2000, and the board now has a dissenting director.

Lane says he looks forward to working with Morris. The board should back that up with a committee seat for him, preferably audit or nominating and governance.

Directors should also own the stock they oversee. Lane’s funds bought 1.9 million shares in August and September. The five re-elected outside directors (Read, Matthew Homer, Jonathan Foster, Adrian Solgaard and Rohan Chauhan) owned 60,000 shares between them on September 1. Homer and Chauhan owned none. Neither Morris nor Robertson owns any. A board asking holders to back a second change of strategy should be buying alongside them.

The board also owes holders answers. Empery has reported material weaknesses in its internal controls every year since its 2020 audit, under the old Volcon board and the new one. It said the data-center lease was “on track for execution in September 2026,” but by October 15 it had not announced a signed lease or a closing. And holders still need the certified vote, including the result on the 2025 stock plan, which decides whether executives can exercise options on about 4 million shares at $10 each.

What to watch

• Coming days
  The certified results in an 8-K: vote totals for each nominee and the result on the 2025 stock plan. The plan would set aside 6.8 million shares for awards and, by Empery’s count, raise potential dilution to about 15.4%.
• Coming weeks
  Committee assignments for Morris and Robertson.
• Any time
  A signed lease and a closing for the Midwest data-center site, where Empery has agreed to put in $65 million for 25%. It has paid $2.9 million of that so far.
• Mid-November
  Third-quarter 10-Q: bitcoin held, debt, net asset value and the cost of the contest.
• Pending
  The Chancery court’s award of fees on the sanction, ATG’s claim over the March share offering, and ATG’s plan to seek reimbursement of about $9.15 million in expenses without a shareholder vote.

Sources: Empery Digital’s SEC filings and both sides’ proxy materials, as of October 15, 2026. Proxy advisors’ recommendations are as ATG and the company reported them. The advisor chart shows seven of the eight nominees in contention; the eighth, Rohan Chauhan, was backed by ISS and re-elected, and Glass Lewis’s view of him was not disclosed. Returns are total returns. Boardroom Alpha is an independent research and analytics company and does not invest. This brief is for information only and is not investment advice or a proxy solicitation.