Forward Industries, Inc. (NASDAQ: FWDI) has issued an open letter to shareholders of SkyAI, urging them to vote against the company's 2026 Equity Incentive Plan and to withhold votes on all five director nominees at the upcoming annual meeting scheduled for September 18, 2026. The move comes after SkyAI rejected Forward's all-stock acquisition proposal valued at $1.55 per share, which represented a 20% premium to SkyAI's prior closing price, according to a press release from Forward.
Forward's letter highlights several concerns, including SkyAI's financial performance and shareholder value, as well as related-party arrangements. Specifically, Forward points to SkyAI's proxy disclosure of $3.3 million in consulting fees paid to Sol Edge Limited and warrants valued at approximately $101.3 million issued to Sol Markets. Forward asserts that these entities are owned and controlled by the brother of SkyAI's Chief Investment Officer and director, Yuwen (Alice) Zhang. These transactions raise questions about governance and potential conflicts of interest, Forward suggests.
The proposed equity incentive plan would authorize an additional 5,145,000 shares for equity awards, representing approximately 7.2% dilution for existing shareholders. Forward argues that this dilution is excessive and not in the best interests of shareholders, especially given the company's rejection of a premium acquisition offer. Forward also notes that the equity plan can be defeated by a majority of votes cast against it, making shareholder opposition a viable path to block the measure.
Regarding the director nominees, Forward points out that SkyAI's uncontested plurality voting structure means that individual director nominees cannot be defeated solely through withhold votes. However, Forward still urges shareholders to withhold votes as a signal of dissatisfaction with the current board's oversight and decision-making, particularly in light of the rejected acquisition and related-party transactions.
Forward Industries remains confident in the strategic rationale for a combination with SkyAI and has expressed willingness to engage in discussions regarding a potential strategic transaction. The company is urging shareholders to carefully consider the implications of the equity plan and board composition for their investment.
For Forward Industries, this action is part of its broader strategy as a Solana-focused digital asset treasury company. The company's mission is to expand and strengthen the Solana ecosystem by acquiring and staking SOL and investing in related projects, with the goal of increasing shareholder value. Forward launched this digital asset treasury strategy in September 2025 with support from investors including Galaxy Digital and Jump Crypto. More information about Forward's treasury strategy is available at www.forwardindustries.com.
The full press release from Forward Industries can be viewed at https://nnw.fm/1Yn1Q.
