Forward Industries (NASDAQ: FWDI) has issued an open letter to shareholders of SkyAI, urging them to vote against the company's proposed 2026 Equity Incentive Plan and to withhold votes on all five director nominees at the upcoming annual meeting scheduled for Sept. 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.
In its letter, Forward highlighted several concerns about SkyAI's corporate governance and financial practices. Notably, the company pointed to related-party transactions disclosed in SkyAI's proxy statement, including $3.3 million in consulting fees paid to Sol Edge Limited and warrants valued at approximately $101.3 million issued to Sol Markets. According to Forward, these entities are owned and controlled by the brother of SkyAI's Chief Investment Officer and director, Yuwen (Alice) Zhang.
Forward is asking shareholders to vote against the proposed equity incentive plan, which would authorize 5,145,000 additional shares for equity awards, representing approximately 7.2% additional dilution. The company noted that the equity plan can be defeated by a majority of votes cast against it. In contrast, SkyAI's uncontested plurality voting structure means that individual director nominees cannot be defeated solely through withhold votes, which is why Forward is urging shareholders to withhold votes on all nominees as a protest.
Despite the rejection of its acquisition proposal, Forward stated that it remains confident in the strategic rationale for a combination with SkyAI and is prepared to engage regarding a potential strategic transaction. The company's push to sway shareholders is likely to escalate tensions between the two firms and could influence the outcome of the annual meeting.
The implications of this shareholder activism are significant for SkyAI's governance and future direction. If shareholders side with Forward, the equity plan could be defeated, limiting management's ability to issue new shares and potentially impacting executive compensation. Additionally, a strong withhold vote on directors would send a clear message about shareholder dissatisfaction with the board's oversight of related-party transactions and its rejection of a premium acquisition offer.
For Forward Industries, which has repositioned itself as a Solana-focused digital asset treasury company, the campaign against SkyAI is part of its broader strategy to create shareholder value through strategic investments and acquisitions. The company's treasury strategy is supported by industry leaders such as Galaxy Digital and Jump Crypto, and it aims to expand the Solana ecosystem.
Investors and market observers will be watching the annual meeting closely, as the outcome could set a precedent for how similar governance disputes are resolved in the technology sector. The vote also tests the influence of activist shareholders in shaping corporate decisions, particularly when related-party transactions are involved.
For more information on Forward Industries and its Solana treasury strategy, visit www.forwardindustries.com. The full press release is available at https://nnw.fm/1Yn1Q.
