Forward Industries, Inc. (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 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.
In its letter, Forward Industries highlighted several concerns regarding SkyAI's corporate governance and financial practices. Notably, SkyAI's proxy statement disclosed $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 argues that these related-party transactions raise serious questions about the board's independence and its commitment to shareholder value.
The proposed equity incentive plan would authorize an additional 5,145,000 shares for equity awards, representing approximately 7.2% dilution. Forward is urging shareholders to vote against this plan, noting that it can be defeated by a majority of votes cast against it. However, due to SkyAI's plurality voting structure for director elections, individual nominees cannot be defeated solely through withhold votes. As a result, Forward is also asking shareholders to withhold votes from each of the five director nominees to send a clear message of dissatisfaction.
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's letter emphasizes that its proposal was fair and in the best interest of both companies' shareholders, and it is disappointed by SkyAI's refusal to engage constructively.
This development underscores the ongoing tensions between Forward Industries and SkyAI, and the outcome of the shareholder vote could have significant implications for SkyAI's corporate governance and future strategic direction. Shareholders are encouraged to review the full details of the proxy materials and consider the concerns raised by Forward before casting their votes.
For more information on this matter, please visit the full press release at https://nnw.fm/1Yn1Q.
