Rain Enhancement Technologies Holdco, Inc.

Director and Officer Compensation of RWT Prior to the Business Combination

This section discusses the material components of the fiscal year 2024 executive compensation programs for the executive officers of RWT who were “named executive officers” for 2024. For information regarding the compensation programs of Holdco following the completion of the Business Combination, which may differ materially from the programs summarized or referred to in this discussion, see “-Director and Officer Compensation of Holdco.”

Introduction

The primary objective of RWT’s executive compensation program is to attract and retain talented executives to effectively manage and lead the company.

RWT’s named executive officers for 2024 were:

Summary Compensation Table

No named executive officer received compensation for services rendered to RWT during 2024. RWT’s non-employee directors did not receive any compensation from RWT during 2024. On August 22, 2024, the RWT Board approved the adoption of an equity incentive plan (the “2024 Equity Incentive Plan”). Prior to the Business Combination closing, the 2024 Equity Incentive Plan allowed up to 2,000 shares of RWT’s Class A common stock, with an exercise price of not less than 100% of the fair market value on the date the awards are granted.

RWT Executive Employment Agreement

On June 26, 2024, RWT entered into an employment agreement (the “Employment Agreement”) with Christopher Riley for the position of Chief Executive Officer. The Employment Agreement was terminated effective as of January 30, 2025, as discussed in more detail below. While in effect, the Employment Agreement provided for “at-will” employment and became effective on December 10, 2024 (the “Effective Date”). Prior to the Effective Date, Mr. Riley was to be compensated at an hourly rate for services performed relating to the Company’s commercial operation (the “Hourly Services”). After the Effective Date, Mr. Riley was to be paid an annual base salary of $500,000, paid in accordance with RWT’s customary payroll practices. Mr. Riley’s base salary was subject to review after RWT has generated at least $100 million in revenue in any fiscal year, and he was eligible for an annual cash bonus of up to 200% of his base salary contingent on Company and personal performance goals established by the board of directors or the compensation committee of the board of directors. In addition, the Employment Agreement provided that, within 90 days following the Effective Date, RWT would issue to Mr. Riley a bonus retention note in the principal amount of $5,000,000, bearing interest at the applicable federal rate published by the Internal Revenue Service for instruments having a term between 3 and 9 years. The outstanding principal balance of the note and accrued unpaid interest would be due and payable on the four-year anniversary of the Effective Date, contingent on Mr. Riley’s continued employment. The payment of the note is subject to acceleration upon termination of Mr. Riley’s employment without Cause (as defined in the Employment Agreement) following the one year anniversary of the Business Combination Closing Date, or upon a change of control of RWT. Following the Effective Date, and upon approval by the compensation committee of the board of directors, the Employment Agreement provided that Mr. Riley would be granted an option to purchase a number of shares of RWT Class A Common Stock equal to 8% of RWT’s fully diluted outstanding shares at such time, at an exercise price equal to the greater of (i) the per share value of the RWT Class A Common Stock at a $200,000,000 valuation and (ii) the fair market value of the RWT Class A Common Stock on the date of grant. Mr. Riley’s options will vest as follows: (x) 50% on the one-year anniversary of Mr. Riley beginning to provide the Hourly Services and (y) 50% on the two-year anniversary of the Closing Date. Mr. Riley was not granted any Options pursuant to the Employment Agreement before his resignation.

Upon termination of Mr. Riley’s employment, pursuant to the Employment Agreement, he would be entitled to be paid his unpaid base salary through the termination date, unreimbursed business expenses, and any vested non-forfeitable amounts owing or accrued as of the termination date, in each case in accordance with RWT’s policies and practices. In addition, (i) in the event that Mr. Riley’s employment is terminated by RWT without Cause, then RWT will pay Mr. Riley an amount in cash equal to 12 months of his then-current base salary in equal installments over the 12-month period following his termination (the “Severance Payment”), and (ii) in the event Mr. Riley’s employment is terminated by RWT without Cause upon or within 12 months following a Change in Control (as defined in RWT’s incentive plan), provided such Change in Control constitutes a change in control under Section 409A of the Internal Revenue Code, then, in addition to the Severance Payment, any unvested equity awards will immediately vest and become exercisable. Such Severance Payment and award vesting acceleration are further conditioned upon Mr. Riley executing a general release of claims within 60 days following termination.

Pursuant to the Employment Agreement, Mr. Riley was also eligible to participate in the Company’s benefit plans and programs, including vacation and health insurance.

On January 29, 2025, Mr. Riley, Holdco and RWT entered into a letter agreement whereby Mr. Riley resigned as Co-Chief Executive Officer of Holdco and RWT effective as of January 30, 2025 (the “Termination Letter”). Pursuant to the Termination Letter, in lieu of all other compensation and payments of any kind due and payable under the Employment Agreement, Mr. Riley will be paid for consulting services rendered in an amount of $124,500, payable in 18 monthly installments beginning in February 2025. Additionally, conditioned on approval by the Compensation Committee of the Board, the Termination Letter provides that Mr. Riley will be granted 10,000 shares of Class A Common Stock of the Company vesting one year from the date of grant.

Director and Officer Compensation of Holdco

Employment Agreements

On December 31, 2024, the Closing Date of the Business Combination, Holdco and Randy Seidl entered into the Offer Letter, pursuant to which Mr. Seidl was offered, and accepted, the position of Chief Executive Officer of Holdco. Pursuant to the Offer Letter, Mr. Seidl’s annual base salary is $500,000, paid in accordance with Holdco’s normal payroll practice. Further, the Offer Letter provides that Mr. Seidl will be eligible to earn an annual bonus with a target of 200% of base salary, based upon mutually agreed performance objectives and the terms and conditions of Holdco’s annual bonus program in effect from time to time. The Offer Letter provides that within 30 days of the effective date of the offer letter, Holdco shall issue to Mr. Seidl the Officer Note with a four-year term with a face value of $5,000,000, which shall accrue interest at a rate equal to the applicable federal rate most recently published by the IRS as of the date of the Officer Note and which shall become due and payable on the earlier to occur of (x) the four-year anniversary of the date of the Officer Note, subject to Mr. Seidl’s continued service with Holdco through such date, (y) if Holdco terminates Mr. Seidl’s employment without cause following the Business Combination, the date of such termination, and (z) the date on which a change in control is consummated.

Mr. Seidl will be eligible to participate in Holdco’s comprehensive employee benefit offerings, including a 401(k) plan and various health and welfare benefits. The Offer Letter also provides that Mr. Seidl will be eligible to participate in any additional executive-level plans that Holdco may adopt for similarly situated employees.

Mr. Seidl’s employment with Holdco is “at-will,” meaning either Holdco or Mr. Seidl may terminate Mr. Seidl’s employment at any time for any reason. Upon termination, Mr. Seidl will be entitled to any earned but unpaid base salary and reimbursement of any expense properly incurred through the date of termination, and, if Mr. Seidl is terminated by Holdco without cause, payment of the Officer Note.

Holdco and Mr. Seidl agreed to replace the Officer Note, which was not yet issued, with the Retention Bonus to better reflect the nature of the commitment. As of the date of this filing, the Retention Bonus has not been issued.

Overview of Anticipated Executive Compensation Program

Decisions with respect to the compensation of Holdco’s executive officers, including our named executive officers, will be made by the compensation committee of the Board. The following discussion is based on the present expectations as to the compensation of our named executive officers and directors for 2025. The actual compensation of our named executive officers will depend on the judgment of the members of the compensation committee and may differ from that set forth in the following discussion. Such compensation will also generally be governed by our executive officers’ employment agreements, as in effect from time to time, including as described above.

We expect Holdco’s executive compensation program will be designed to:

We anticipate that compensation for our executive officers will have the following components: base salary, cash bonus opportunities, equity compensation, employee benefits, and severance protections. Base salaries, employee benefits, and severance protections will be designed to attract and retain senior management talent. We will also use annual cash bonuses and equity awards to promote performance-based pay that aligns the interests of our named executive officers with the long-term interests of our stockholders and enhances executive retention.

Other Compensation and Benefits

Holdco expects to offer various employee benefit plans to employees, including its named executive officers, including certain insurance benefits, as well as the 401(k) profit sharing plan. We may also provide our named executive officers with perquisites and personal benefits that are not generally available to all employees.

Director Compensation

Effective as of April 4, 2025, the Board adopted a form of Director Agreement to govern the terms of service and compensation of the Company’s non-employee directors (the “Director Agreement”). Under the Director Agreement, members of the Board will receive compensation for service on the Board and on committees of the Board consisting of the following: (i) subject to approval by the Board and compensation committee of the Board, a cash payment of $12,500 promptly following attendance at each quarterly Board meeting, for a total annual cash compensation of $50,000; and (ii) at the beginning of each year of service, and subject to approval by the Board and the compensation committee of the Board, a grant of restricted stock, with the number of shares determined by dividing $100,000 by the closing price of the Company’s Class A Common Stock as reported on the Nasdaq Stock Market LLC on the date of the grant. The restricted stock granted pursuant to the Director Agreement will vest in full on the first anniversary of the grant date, subject to acceleration in accordance with the terms of the restricted stock award or the Company’s 2024 Incentive Award Plan.

The Company has entered into Director Agreements with each of Lyman Dickerson, Alexandra Steele, Christopher Riley, Marcus Peperzak, and Robert Reardon. The terms of the Director Agreements are consistent with the Company’s standard form of Director Agreement described above, except with respect to the grants of restricted stock to Mr. Dickerson and Mr. Riley, which are as follows: (i) subject to approval by the Board and the Compensation Committee, in lieu of an annual grant of restricted stock, Mr. Dickerson will receive an initial grant of restricted stock equal to the number of shares determined by dividing $2,000,000 by the closing price of the Class A Common Stock on the date of grant, and such grant of restricted stock will vest in full on the third anniversary of the grant date, subject to acceleration in accordance with the terms of the restricted stock award or the Company’s 2024 Incentive Award Plan, and (ii) subject to approval by the Board and the Compensation Committee, Mr. Riley will receive an annual grant of restricted stock equal to the number of shares determined by dividing $50,000 by the closing price of the Class A Common Stock on the date of grant.

The grants of restricted stock to each of Mr. Dickerson, Ms. Steele, Mr. Riley, Mr. Peperzak, and Mr. Reardon pursuant to the Director Agreements were deferred by the Board.

Holdco Incentive Plan

On December 19, 2024, prior to the completion of the Business Combination, Holdco’s sole director and sole shareholder approved the Rain Enhancement Technologies Holdco, Inc. 2024 Equity Incentive (the “2024 Incentive Plan”) under which Holdco may grant equity and equity-based incentive awards to officers, employees, non-employee directors and consultants. Pursuant to its terms, the 2024 Incentive Plan became effective on December 31, 2024, upon the Closing.

Administration. The Compensation Committee of the Board (the “Committee”) will administer the 2024 Incentive Plan. The Committee will generally have the authority to designate participants, determine the type or types of awards to be granted to a participant, determine the terms and conditions of any agreements evidencing any awards granted under the 2024 Incentive Plan, accelerate the vesting or exercisability of, payment for or lapse of restrictions on, awards and to adopt, alter and repeal rules, guidelines and practices relating to the 2024 Incentive Plan. The Committee will have full discretion to administer and interpret the 2024 Incentive Plan and to make any other determinations and/or take any other action that it deems necessary or desirable for the administration of the 2024 Incentive Plan, and any such determinations or actions taken by the Committee shall be final, conclusive and binding upon all persons and entities. The Committee may delegate to one or more officers of Holdco or any affiliate the authority to act on behalf of the Committee with respect to any matter, right, obligation or election that is the responsibility of or that is allocated to the Committee in the 2024 Incentive Plan and that may be so delegated as a matter of law, except for grants of awards to persons subject to Section 16 of the Exchange Act.

Eligibility. Certain employees, directors, officers, advisors or consultants of Holdco or its affiliates are eligible to participate in the 2024 Incentive Plan.

Number of Shares Authorized. Holdco has initially reserved 747,168 shares of Class A Common Stock for the issuance of awards under the 2024 Incentive Plan. The number of shares reserved for issuance under the 2024 Incentive Plan will increase automatically on January 1 of each of 2025 through 2034 by the number of shares equal to 5.0% of the total number of outstanding shares (rounded down to the nearest whole share) of Class A Common Stock as of December 31 of the immediately preceding year. Notwithstanding anything to the contrary in the 2024 Incentive Plan, no more than the number of shares of Class A Common Stock initially reserved under the 2024 Incentive Plan may be issued pursuant to the exercise of incentive stock options (“ISOs”) under the 2024 Incentive Plan.

Shares of Class A Common Stock underlying awards under the 2024 Incentive Plan that are forfeited, canceled, expire unexercised or are settled in cash will be available again for new awards under the 2024 Incentive Plan. If there is any change in Holdco’s corporate capitalization, the Committee in its sole discretion may make substitutions or adjustments to the number of shares of Class A Common Stock reserved for issuance under the 2024 Incentive Plan, the number of shares of Class A Common Stock covered by awards then outstanding under the 2024 Incentive Plan, the limitations on awards under the 2024 Incentive Plan, the exercise price of outstanding options and such other equitable substitutions or adjustments as it may determine appropriate.

The 2024 Incentive Plan has a term of 10 years from the Closing, and no further awards may be granted under the 2024 Incentive Plan after that date.

Awards Available for Grant. The Committee may grant awards of nonqualified stock options, incentive stock options (“ISOs”), stock appreciation rights (“SARs”), restricted stock awards (“RSAs”), restricted stock units (“RSUs”), other stock-based awards, other cash-based awards, dividend equivalents, and/or performance compensation awards or any combination of the foregoing.

Stock Options and Stock Appreciation Rights. Stock options provide for the purchase of shares of Class A Common Stock in the future at an exercise price set on the grant date. ISOs, in contrast to nonqualified stock options, may provide tax deferral beyond exercise and favorable capital gains tax treatment to their holders if certain holding period and other requirements of the Internal Revenue Code of 1986, as amended, are satisfied. SARs entitle their holder, upon exercise, to receive from us an amount in cash or shares equal to the appreciation of the shares subject to the award between the grant date and the exercise date. The exercise price of a stock option or SAR may not be less than 100% of the fair market value of the underlying share on the grant date (or 110% in the case of ISOs granted to certain significant stockholders), except with respect to certain substitute awards granted in connection with a corporate transaction. The term of a stock option or SAR may not be longer than 10 years from grant (or five years in the case of ISOs granted to certain significant stockholders).

RSAs. RSAs are an award of nontransferable shares of Class A Common Stock that are subject to certain vesting conditions and other restrictions.

RSUs. RSUs are contractual promises to deliver shares of Class A Common Stock in the future, which may also remain forfeitable unless and until specified conditions are met and may be accompanied by the right to receive the equivalent value of dividends paid on shares of common stock prior to the delivery of the underlying shares (i.e., dividend equivalent rights). The Committee may provide that the delivery of the shares underlying RSUs will be deferred if such delivery would result in a violation of applicable law. The terms and conditions applicable to RSUs will be determined by the Committee, subject to the conditions and limitations contained in the 2024 Incentive Plan.

Other Stock or Cash-Based Awards. Other stock or cash based awards are awards of cash, fully vested shares of Class A Common Stock and other awards valued wholly or partially by referring to, or otherwise based on, shares of Class A Common Stock. Other stock or cash based awards may be granted to participants and may also be available as a payment form in the settlement of other awards or as standalone payments.

Dividend Equivalents. Dividend equivalents represent the right to receive the equivalent value of dividends paid on shares of Class A Common Stock and may be granted alone or in tandem with awards other than stock options or SARs. Dividend equivalents are credited as of the dividend record dates during the period between the date an award is granted and the date such award vests, is exercised, is distributed or expires, as determined by the Committee; however, dividend equivalents will not be payable unless and until the underlying award becomes payable and will be subject to forfeiture to the same extent as the underlying award.

Performance Awards. Performance awards granted pursuant to the 2024 Incentive Plan may be in the form of a cash bonus, or an award of performance shares or performance units denominated in shares of Class A Common Stock, that may be settled in cash, property or by issuance of those shares subject to the satisfaction or achievement of specified performance conditions.

Transferability. Each award may be exercised during the participant’s lifetime only by the participant or, if permissible under applicable law, by the participant’s guardian or legal representative and may not be otherwise assigned, alienated, pledged, attached, sold or otherwise transferred or encumbered by a participant other than by will or by the laws of descent and distribution and any such purported assignment, alienation, pledge, attachment, sale, transfer or encumbrance will be void and unenforceable against Holdco or its affiliates. The Committee, however, may permit awards (other than ISOs) to be transferred to family members, a trust for the benefit of such family members, a partnership or limited liability company whose partners or stockholders are the participant and his or her family members or anyone else approved by it.

Amendment and Termination; Repricing. In general, the Board may amend, alter, suspend, discontinue or terminate the 2024 Incentive Plan at any time. However, stockholder approval to amend the 2024 Incentive Plan may be necessary if applicable law or the 2024 Incentive Plan so requires. No amendment, alteration, suspension, discontinuance or termination will materially and adversely impair the rights of any participant or recipient of any award without the consent of the participant or recipient. Stockholder approval will not be required for any amendment that reduces the exercise price of any stock option or SAR, or cancels any stock option or SAR that has an exercise price that is greater than the then-current fair market value of Class A Common Stock in exchange for cash, other awards or stock options or SARs with an exercise price per share that is less than the exercise price per share of the original stock options or SARs.

Adjustments; Corporate Transactions. In the event of certain capitalization events or corporate transactions (as set forth in the 2024 Incentive Plan), including the consummation of a merger or consolidation of Holdco with another corporation, the Committee may adjust the number of shares of Class A Common Stock or other securities of Holdco (or number and kind of other securities or other property) subject to an award, the exercise or strike price of an award, or any applicable performance measure, and may provide for the substitution or assumption of outstanding awards in a manner that substantially preserves the terms of such awards, the acceleration of the exercisability or lapse of restrictions applicable to outstanding awards and the cancellation of outstanding awards in exchange for the consideration received by stockholders of Holdco in connection with such transaction.