SkyAI Shareholder Bastion Trading Raises Concerns Over Tender Offer
Bastion Trading, which says it holds 9.99% of SkyAI, criticized the proposed cash tender offer announced October 11 and called for further disclosure and board changes. It alleges SkyAI sold roughly 70% of its Solana holdings in less than a month, without disclosing sale timing, prices or proceeds.
Concerns include the lack of transparency surrounding the Company’s recent disposal of approximately 70% of its Solana (SOL) holdings2, the legitimacy of the incumbent Board of Directors (the "Board") after the Company’s 2026 annual meeting of stockholders (the "2026 Annual Meeting"), and the fairness of the proposed tender offer terms. Massive Disposal of SOL Treasury Raises Serious Concerns and Disclosure and Securities Law Questions Bastion Trading is particularly alarmed by the Company’s lack of transparency surrounding its recent massive SOL disposals.
Buried in the Tender Offer Announcement, the Company disclosed that it had disposed of approximately one million SOL tokens, representing roughly 50% of its SOL treasury holdings, without previously providing stockholders with a comprehensive public accounting of these material transactions. However, the Company’s subsequent Form 8-K3 revealed that in fact only approximately 600,000 SOL tokens remained — indicating a disposal of roughly 70% of its SOL holdings in less than one month.
Despite the extraordinary magnitude of these material transactions, such disclosures were tucked into the end of the Tender Offer Announcement and the subsequent Form 8-K in what appears to be an effort to sweep them under the rug. 4 Less than one month later, stockholders learned that approximately 70% of those treasury holdings had been sold, without being told when the sales occurred, at what prices, what proceeds were realized, or how the transactions were approved.
Given that SOL treasury holdings are central to SkyAI’s asset value and investment proposition, Bastion Trading believes these disposals raise serious concerns regarding the viability of the Company’s business strategy, and questions regarding the Company’s compliance with the applicable securities laws, regulations and Nasdaq disclosure requirement rules. Bastion Trading further believes that the disposal of approximately 70% of SkyAI’s core SOL treasury, represents a fundamental departure from the Company’s previously disclosed DAT strategy.
We call on the Company to come forward now and explain to stockholders why it made this decision, when it was made, and what it means for SkyAI’s strategy going forward. The Board Has Failed Stockholders and Continues to Ignore Their Mandate Our concerns are further compounded by the Board’s clear lack of stockholder support. At the 2026 Annual Meeting, all five incumbent director nominees received substantially more WITHHOLD votes than votes in favor, in some cases by nearly a 3-to-1 ratio — in what we believe is one of the largest withhold votes ever received by incumbent directors in an uncontested election.
This is a clear message to the Board that stockholders have lost faith in its ability to adequately oversee the Company and protect their interests. On September 30, Bastion Trading publicly called on the Board to respect this overwhelming mandate and meaningfully reconstitute itself. Bastion Trading subsequently engaged in preliminary discussions with Company management. Unfortunately, those discussions were unproductive, and the Company made no commitment to make changes to the current composition of the Board or meaningfully address our governance concerns.
Instead, the incumbent Board has announced a tender offer that could fundamentally reshape the Company’s principal business strategy, ownership and capital structure, and which was funded by the disposal of approximately 70% of its SOL treasury. Bastion Trading questions the legitimacy of the incumbent directors continuing to make such fundamental decisions affecting shareholder value and the future of the Company despite stockholders’ overwhelming vote of no confidence in the Board.
In our view, a board that has lost the confidence of its stockholders should not dictate the terms of a transaction of this magnitude without first ensuring stockholder perspectives are represented in the boardroom to restore independent oversight and stockholder accountability. We call on the Board to immediately and meaningfully engage with its stockholders to address our concerns and substantially refresh the Board with new independent directors with a stockholder’s perspective that can provide effective oversight in the boardroom and help restore investors’ faith in the Company.
Bastion Trading calls on SkyAI to take the following immediate actions before commencing the proposed tender offer: 1. Provide Full Disclosure On and Conduct an Independent Review of SOL Disposals. We call on the Company to immediately disclose the dates and quantities of all recent SOL disposals; average realized sale prices; aggregate gross and net proceeds and transaction costs; a fulsome description of the Board and/or committee review and approval process; and the current breakdown of liquid and locked SOL holdings.
The Company must also explain why the disposal of approximately 70% of its SOL treasury was not separately disclosed before the Tender Offer Announcement. An independent review should immediately examine the transactions, their authorization and the Company’s compliance with applicable disclosure obligations, with its findings made public. 2. Refresh the Board and Establish Independent Oversight.
Immediately refresh the Board to include stockholder-identified independent directors before launching the tender offer and establish an independent special committee to review and oversee the tender offer process. A genuinely independent special committee, including stockholder-identified directors and supported by independent legal advisors, should oversee the entire tender offer process, including pricing, funding, transaction conditions, potential conflicts of interest, and stockholder communications. 3. Materially Improve the Tender Offer Terms.
30 per share* and what we believe is a reasonable premium to ensure stockholders receive fair value for their investments; Exclude strategic advisor warrants from participating in the tender offer. Bastion Trading believes these warrants should not be treated on the same economic footing as securities held by investors who committed substantial capital to the Company and bore the associated investment risks.
6 Bastion Trading believes it would be fundamentally unfair to allow this insider-related party to additionally monetize its warrants through a tender offer funded by the material disposal of the Company’s core treasury assets; Require incumbent directors, executive officers, strategic advisor and their respective affiliates to refrain from tendering any common shares or eligible warrants they hold.
Bastion Trading believes these parties should not personally benefit from a transaction they may have influenced or approved, particularly given potential conflicts of interest and their positions as insiders and related parties; Remove the $100 SOL price condition, which we believe creates unnecessary uncertainty for participating stockholders and gives the Company excessive flexibility to abandon the tender offer based on short-term movements in the SOL market price; Remove the 50% minimum tender participation condition for each class of securities, which we believe also creates unnecessary execution uncertainty; Increase the maximum tender percentage to 100% for the pre-funded warrants, which would allow such holders to fully exit their positions rather than being required to retain a residual interest in the Company; and Ensure full compliance with all applicable tender-offer requirements.